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www.MailingSystemsTechnology.com

Silver Anniversary! It’s Our

Creating a BEST-IN-CLASS mailing operation Page 16

Going digital for postage optimization Page 8

Creating your full-service intelligent mail strategy Page 11

THE FUTURE of Mail

Industry Executive Perspectives Page 31

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Volume 25 Issue 3

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Features 16

Defining Best-in-Class Mail Operations There is an elite club in mail services. It is the top mail managers who we see at every industry event, who are connected with their peers both locally and nationally. Here’s what it takes to become one of them. By Adam Lewenberg

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It’s a Girl… It’s a Boy… It’s a Magazine! The creators of Mailing Systems Technology overcame nay-sayers, initial cash flow issues, and tedious design processes to give birth to the premier magazine in the mailing industry. And after 25 years, it’s still going strong! By Marll Thiede

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A 25-Year Rate-rospective How have postal rates changed compared to other household items over the past 25 years? You may be surprised! By Margaret Cigno and Shoshana Grove | Graphics by James Cigno

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Looking Ahead: Building Value in the Mail Reaching for 100% product visibility by 2014 Insight from Jim Cochrane, Vice President for Product Information, USPS

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The Future of Mail In this special section, some of the most prominent names in the mailing industry give their thoughts on the past, present and future of mail.

Departments 6

Real-Life Management Happiness: The Fuel to Success and Performance By Wes Friesen

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Software Byte Going Digital for Postage Optimization By Christopher Lien

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The Trenches

Columns

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Special Guest Column An Opinion on Do Not Mail By Todd Butler

Postal Affairs

Pushing Toward Full-Service By Kevin Conti and David Robinson

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Everything IMBC

Ship It Is the USPS on Track? By Jim LeRose

Is It Time to Think Green Again? By Mike Porter Creating Your Full-Service Strategy By Kim Mauch

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Editor’s Note Happy 25th!

Reality Check You’ve Won! By Wanda Senne

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Pushing the Envelope Transformation over 25 Years By Kate Muth

Make sure you sign up for our monthly e-Newsletter so we can keep you posted with news alerts and updates! www.MailingSystemsTechnology.com


editor’s note

with Amanda Armendariz

Mailing systems technology PUBLISHER Marll Thiede

EDITOR

Happy 25th! As editor of this publication for the past two years (and managing editor for a couple years before that), it was interesting and strangely gratifying to me to peruse through some of our first issues in preparation for this, our special 25th anniversary issue. It was interesting because I loved seeing what was considered helpful and relevant to our readers 25 years ago, and gratifying because despite the difference in layouts, the black-and-white heavy articles of yesteryear compared to the colorful articles of today, and the (somewhat) difference in content, we are still here. Think about that for a minute. Yes, the mailing industry has changed. Yes, our magazine itself has changed. But both our magazine and the industry are still here, 25 years later, and we are still going strong! How many companies or publications can say that? Not too many, I’m guessing. So I’m grateful that I’m able to sit here today and write yet another editor’s note! If I had to ponder what contributed to our success, the first thing that comes to mind is you, our readers. Thank you for being a loyal subscriber, whether you’ve been with us for all 25 years, or just subscribed last month; we couldn’t do it without you! I can’t imagine that our flexibility hurt us, either. One thing that struck me as I looked over the issues of the 1980s compared to the issues of today is that so many topics covered back then are no longer relevant today, and topics we cover today would have been ignored completely (or not even thought of!) back then. It’s important to stay true to your core competencies, of course (in our case, mail!) but since mail’s meaning in our world can change year-to-year, it’s crucial to stay abreast of these changes and alter your subject matter accordingly. Twenty-five years ago, would the battle between hard-copy mail and electronic communications even popped into our then-editor’s mind? Hardly! But yet that is a pressing topic today for us, our readers, and the mailing industry as a whole. So that is my promise to you: No matter how much the mailing industry changes over the coming years, no matter what new problems (and solutions!) arise for our fellow mailing professionals, Mailing Systems Technology will continue to report on all facets of the mailing industry — in whatever form that may take. As always, thanks for reading Mailing Systems Technology, and here’s to another 25 years!

Amanda Armendariz amanda.c@rbpub.com

CONTRIBUTING WRITERS Todd Butler, Margaret Cigno, Kevin Conti Wes Friesen, Shoshana Grove, Jim LeRose Adam Lewenberg, Christopher Lien, Kim Mauch Kate Muth, Mike Porter, David Robinson Wanda Senne, Marll Thiede

CIRCULATION

Rachel Spahr rachel@rbpub.com

ADVERTISING 608-442-5064 Ken Waddell ken.w@rbpub.com

GRAPHIC DESIGN Kelli Cooke

2901 International Lane • Madison WI 53704-3128 608-241-8777 • Fax 608-241-8666 rbpub@rbpub.com www.MailingSystemsTechnology.com

Volume 25, Issue 3 Subscriptions are free to qualified recipients: $20 per year to all others in the United States. Subscription rate for Canada or Mexico is $40 per year, and for elsewhere outside of the United States is $45. Back issue rate is $5. Send subscriptions to: Mailing Systems Technology, PO Box 259098, Madison WI 53725-9098; or call 608-241-8777; fax 608-241-8666; e-mail rbpub@rbpub.com or subscribe online at www.MailingSystemsTechnology.com. For high-quality reprints, please contact our exclusive reprint provider. Scoop Reprint Source 800.767.3263 ext. 144 www.scoopreprintsource.com. All material in this magazine is copyrighted ©2012 by RB Publishing Inc. All rights reserved. Nothing may be reproduced in whole or in part without written permission from the publisher. Any correspondence sent to Mailing Systems Technology, RB Publishing Inc. or its staff becomes property of RB Publishing Inc. The articles in this magazine represent the views of the authors and not those of RB Publishing Inc. or Mailing Systems Technology. RB Publishing Inc. and/or Mailing Systems Technology expressly disclaim any liability for the products or services sold or otherwise endorsed by advertisers or authors included in this magazine. Mailing Systems Technology (ISSN 1088-2677) [Volume 25, Issue 3] is published six times per year, (January/February, March Buyers Resource, March/April, May/June, September/October, November/December) by RB Publishing Inc., 2901 International Lane, Suite 100, Madison WI 53704-3128, 608-241-8777. Periodical postage paid at Madison WI and additional offices. Postmaster: Send address changes to: Mailing Systems Technology PO Box 259098 Madison WI 53725-9098


Real Life Management Happiness: The Fuel to Success and Performance Want to provide the fuel to drive your team to higher levels of success and performance? The fuel is happiness. Ground breaking research in the fields of positive psychology and neuroscience has shown that happiness is the precursor to success — not merely the result. and happiness and optimism actually fuel performance and achievement. How do scientists define “happiness?” Scientists boil down happiness to the experience of positive emotions — pleasure combined with deeper feelings of meaning and purpose. Happiness implies a positive mood now and a positive outlook for the future. Franklin Roosevelt had the basic idea when he said, “Happiness lies in the joy of achievement and the thrill of creative effort”.

How Can We Increase Happiness and Create a More Positive Mindset? Over 200 studies on over 275,000 people worldwide found that happiness leads to success in nearly every domain — including the mail industry! Research has found that our brains are hardwired to perform best when they are in a positive state, not negative or even neutral. How do we build more happiness into our lives and the lives of our team members? Here are some ideas that we can use ourselves and share with our team members (from Dr. Shawn anchor’s excellent book The Happiness Advantage): Meditate/Pray: Research has shown that a few minutes per day of regular meditation can permanently rewire the brain to raise levels of happiness. Find Something to Look Forward To: We know that often the most enjoyable part of any special activity is the anticipation. One study found that people who just thought about watching their favorite movie actually raised their endorphin levels by 27%. If you can’t take the time out right now for a vacation or a special night out with friends, put something on the calendar, even if it’s weeks out. Then whenever you need a boost of happiness, remind yourself about it (I know this works — I just thought ahead to my summer vacation with my family and I feel instantly happier!). Commit Conscious Acts of Kindness: Research has shown that acts of intentional altruism (kindness) decrease stress and strongly contribute to enhanced mental health. you can try this for yourself by picking one day where you intentionally complete five acts of kindness. you may be surprised at your increased level of happiness — and the recipients of your kindness will feel happier too!

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Infuse Positivity into Your Surroundings: Our physical environment can have a significant impact on our mindset and sense of well-being. We can intentionally infuse our work areas with images that spark positive emotions — pictures of family and friends and pets, and reminders of our favorite sports teams or special experiences in our lives. making time to go outside on a nice day is also uplifting — and one study found that spending 20 minutes outside in good weather not only boosted positive mood, but also broadened thinking and improved memory. We can also change our surroundings to minimize negative emotions. a good place to start is to watch less TV. Studies have shown that the less TV we watch (especially violent and negative programs), the happier we are. Exercise and Physical Activity: exercise releases pleasureinducing chemicals called endorphins and has other benefits. Physical activity can boost mood, improve motivation and feelings of mastery, reduce stress and anxiety, and help us get into a flow of engagement and productivity. One landmark study on depressed people showed that exercise was just as effective as anti-depressants in the short run, and in the long run, exercise was significantly more effective. Spend Money (but not on Stuff): Research has shown that money spent on activities (e.g. group dinners, concerts, sporting events) brought far more pleasure than material purchases like shoes, TVs, or expensive watches. Spending money on other people also boosts happiness. Exercise Signature Strength: Studies have shown that the more we use our signature strengths, the happier we become. We all have multiple things that we are good at. each time we use a skill we are good at, we experience a burst of positivity. If you need a happiness booster, try using a talent you have not used for awhile. Researchers have found that exercising strength of character is even more fulfilling than using a skill. a team of psychologists have identified 24 character strengths that most contribute to human flourishing. They developed a 240-question survey that identifies a person’s top five “signature strengths” (you can take this survey for free; go to www.viasurvey.org or scan the QR code on the next page). In a study volunteers were asked to pick one of their signature strengths and use it in a new way each day for a week. These volunteers became significantly happier and less depressed than control groups. and these heightened levels of happiness remained six months later when re-examined.


With Wes Friesen

Motivating Your Team The best managers use the Happiness Advantage as a means to motivate their teams and maximize individual and team potential. Research has shown that even small moments of positivity in the workplace can enhance efficiency, creativity, motivation, and productivity. One was to do this simply is to provide frequent recognition and encouragement. One study found that teams with encouraging managers performed 31% better than teams with managers who were less positive and less open with praise! Recognition can take many forms — verbal thanks, complimentary emails, written notes, and can include meaningful tokens of appreciation like gift cards, certificates of appreciation, or food. Let me close with this perspective from Eleanor Roosevelt: “Since you get more joy out of giving joy to others, you should put a good deal of thought into the happiness that you are able to give.” One of the great privileges we have as managers is to help bring increased happiness into the lives of our team members. It will benefit them individually — and spark the team to new levels of performance. Good luck to you as you use the fuel of happiness to drive yourself and your team to higher levels of success! a

TAKE THE SURVEY www.viasurvey.org

Wes Friesen, MBA, CMDSM, EMCM, MQC, ICP, CCM,CMA, CM, CFM, APP, PHR is the Manager of Revenue Collection & Community Offices for Portland General Electric, a utility in Portland, Oregon that serves over 820,000 customers. Wes teaches university classes and is a featured speaker at national Conferences like National Postal Forum, MailCom, FUSION and others. He manages the bill presentment and payment processing teams with the able assistance of supervisors Eric Houger, Tom Laszlo, Gil Rodriguez and Rick VanBeek. Wes can be contacted at Wes.Friesen@pgn.com. Check out his personal website for free information (www.wesfriesen.com).


Software Byte Going Digital for Postage Optimization Commingling mailpieces is one of the most effective ways to optimize your postage investment. Postage continues to be the largest attributable cost per mailpiece, and judging by the current dire financial situation of the United States Postal Service, it doesn’t look like that situation is going to change anytime soon. Thus, many mailers are still turning to various commingling methods to reduce their overall postage, optimize their mail production, and move closer to the last mile. Commingling is not a new concept. Periodical mailers have been combining publications for decades in order to achieve higher carrier route discounts. Different publications grouped into the same bundle in order to achieve six pieces to a route could yield substantial discounts to the mailer. In fact, one form of commingling for periodicals that is still very popular today is commingling at the address level in the form of firm bundles. A firm bundle is when two or more pieces of the same periodical is commingled together to form a single addressed piece. This is very common

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for a dentist office or, in my case, Boys’ Life Magazine, since my three sons and I are very involved in the Boy Scouts of America. Periodical piece postage is paid for just the one addressed piece instead of each physical copy mailed to that address. Standard mailers have also been commingling, though they typically do so at a container level. Grouping together bundles or pieces into a single tray, sack, or pallet yields postage discounts as well as destination entry opportunities. In the mid-1990s, many catalog mailers were palletizing sacks of mail in order to form courtesy pallets for destination entry discounts. Since then, software and hardware technology has advanced considerably and now sacked mailings have been significantly reduced, allowing more mail to be directly inducted into strategic entry points. Mailers have also been commingling across classes. Around 2006, software that would combine Standard Mail catalogs and Periodical magazines into a single commingled stream started


With Christopher Lien

to emerge. This mixed-class commingling solution opened doors for transportation companies to leverage co-mail machines as a way to intermingle dissimilar mailings into a large “pool� of combined mailpieces, yielding great carrier route discounts and further induction into the USPS processing network. Despite whether mailings are commingled at the address, the bundle, the container, or the truck level, software is still very much at the heart of the decision process. Determining the optimal commingling pool is essential for any commingling process and significant advancements have been made recently in postage optimization. By analyzing piece and job attributes such as trim size, piece weight, mail class, and in-home dates, software can begin to assist mailers in determining candidate jobs for their commingling pool. Grouping together common ZIP Code ranges and sortation schemes can also help determine what should be sorted in data (traditional PAVE-certified presorting software) and what should be sorted physically

(using MLOCR devices). Thus, what is beginning to emerge is a commingling strategy that begins to tie data and physical sortation into a single cohesive sortation scheme. Accurate reporting and payment of course are essential as well. Fortunately, Mail.dat and PostalOne are now converging toward an approach whereby complex commingled mailings can be accurately represented in data for prompt and accurate payment. As the USPS continues to optimize its delivery network, significantly changing labeling lists and sortation schemes, mailers need to also consider optimization of their postage process. Commingled mailings, whether done digitally, physically, or both, is still an effective way to reduce overall postage and mail preparation costs. a Chris Lien is Vice President, Software Marketing, Bell and Howell.

www.MailingSystemsTechnology.com a MAY - JUNE 2012

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The Trenches

With Mike Porter

Is it Time to Think Green Again? It’s been quite awhile since I mentioned environmental sustainability in this column. I stopped covering green topics not because they were unimportant, but because the recession forced almost all businesses to reset their priorities. For many of them, environmental initiatives had to be shelved in favor of other business process improvements. Financial issues still exist today. But most of us would agree that the economic climate is better than it was a year ago. more stability in the economy may be making it easier to dust off some of those plans to be greener and start putting the environmental strategies back in place. I may be a bit early in suggesting a renewed focus on environmental awareness. But if you’re in the business of producing paper documents today, getting out in front has its advantages. Internal and external mail customers have an interest in moving volume away from physical mail and into electronic channels. Some of the justification for that migration will be the perceived environmental benefits. If you’ve already taken steps to reduce the environmental footprint of physical documents, you’ll have an opportunity to show decision-makers that mail can be effective, cost-efficient, and green — all at the same time!

New DevelopmeNts Things have changed since I last suggested some strategies to green up your document operation. It is now easier and less expensive than ever to implement some of those strategies. Here are a few items worth noting: TRanSPROmO — all the major document composition products make it easy to support transpromo, thereby lowering reliance on pre-printed inserts. What started out as an IT-centric function to add promotional messages to transactional documents is today more likely to be found as a module to be safely controlled by marketing. This makes implementation and maintenance easier, and makes it more attractive for marketing departments to support transpromo initiatives. uSPS SeCOnD OunCe FRee — The cost to mail a two-ounce letter is about 11 cents less than it was a year ago. Strategies like householding, comingling, and decreased frequency can improve productivity and lower the number of outbound envelopes produced. The lower postage rates may make these strategies more attractive. InKjeT PRInTInG — Full color inkjet devices are available to support print volumes all across the board. The quality is acceptable for transactional documents, correspondence, and direct mail.

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Replacing a warehouse full of pre-printed forms with rolls of plain paper removes the environmental impact of forms packaging and disposal of obsolete materials. Printing full color promotional offers on the documents reduces the use of pre-printed statement stuffers. Imaging the form backgrounds and logos on plain paper also enables comingling documents before printing, which allows you to achieve denser presort levels and improve the productivity of your printing and inserting operations. auTOmaTeD DOCumenT FaCTORy (aDF) — many vendors now offer aDF capabilities in the software-as-a-service (SaaS) model, enabling more organizations to take advantage of quality controls that reduce re-runs, raise productivity, and improve quality without a huge capital investment. DOCumenT Re-enGIneeRInG — The ability to change the appearance of documents without requiring the assistance of IT can make it easier to standardize address block locations, allowing companies to reduce the number of outbound envelopes they must keep in stock. a common outbound envelope is essential for comingling documents prior to printing. Document re-engineering can also be used to reduce page counts, eliminate blank pages, or improve inserting control or piece-tracking marks. many software choices now exist to handle document re-engineering, including some at the lower end of the price scale.

thiNkiNg AheAD This might be a good time for document print and mail center managers to find ways to contribute to their organization’s environmental goals. Paper documents continue to be the most consistent customer touch point. Coupling reductions in environmental impact with an awareness campaign can improve a company’s relationship with their customers. most of the process and design improvements that reduce the environmental footprint of business documents are fairly simple to implement. Often, cost savings can quickly offset investments in assessment activities and new hardware, software, or materials. This might be the time to start planning again for environmental improvements in your document workflow. a mike Porter is President of Print/mail Consultants, a consulting firm that helps companies respond to changing trends and operational challenges, including analyzing the green potential of document processing centers. He welcomes your comments. Visit www.printmailconsultants.com to sign up for Practical Stuff, his free monthly newsletter covering document operations. you can email mike directly at mporter@printmailconsultants.com.


Postal Affairs

With Kim Mauch

Creating Your Full-Service Strategy By now, you’ve probably heard that Full-Service Intelligent mail will be required for automation discounts in january 2014. While uSPS has backed off on deadlines like this in the past, all signs from Washington DC say that Full-Service is going full speed ahead. If you haven’t yet stepped into the world of Intelligent mail, the list of regulations and requirements can feel overwhelming. But by breaking down the process into manageable steps, you can tackle the Full-Service beast with confidence.

STEP 1: Set up your uSPS account Timeline: Today First, you’ll need a uSPS Gateway account and mailer ID (mID). you can sign up for a free account and mID at http://gateway. usps.com. your mID is used in the Intelligent mail piece, container, and tray barcodes to identify you as the sender of the mail. If you mail for others, you can request mailer IDs for each of them in a batch, or use your own. you can also request services such as address Change Service (aCS) or Confirm/Imb Tracing (mail piece tracking) for each mID.

Step 2: Start using Basic Intelligent mail piece barcodes Timeline: As soon as possible Generating and printing Basic Intelligent mail barcodes is fairly straightforward. most existing printing software and hardware support the new barcode, so little work is required on your part. The Imb is very similar in size to POSTneT, so in most cases you can swap the barcodes with little trouble. Sending a few samples to your mailpiece Design analyst (mDa) can ensure that your new barcodes are printed correctly.

Step 3: Start using Intelligent mail tray and container barcodes Timeline: This summer If you prepare your mailings using PaVe software, most of these packages have the tools you need to generate the longer barcodes needed for your trays, sacks, pallets, and other mail containers. In some cases, you can use the tray label stock you use today. It’s important to note that these barcodes have a sequence number in them, just like the piece Im barcodes, and this sequence number must be unique for Full-Service mail. many software packages will take care of these sequence numbers for you.

Step 4: Select your electronic documentation type Timeline: Early fall One of the biggest hurdles with Full-Service is the electronic documentation requirement. Rather than submit your mailings

with printed Postage Statements, Qualification Reports, and other printed documentation, uSPS prefers that you send this information electronically. In addition to replacing your printed paperwork, electronic documentation or eDoc outlines all the Intelligent mail barcodes for your pieces, trays, and containers, and indicates which pieces are in which tray. There are three ways to satisfy the eDoc requirement – mail.dat, mail.xml, or the Postal Wizard. Generally, the Postal Wizard is used for simple, small mailings (under 10,000 pieces). mail.dat is useful if you want to use downstream services such as mail consolidation, logistics, or other processes. mail.xml is great for mailings that are too complicated for the Postal Wizard, but don’t require post-presort processing. you can also use mail.xml to edit mailings already submitted by mail.dat. Generally, you’ll want to choose one or two of these methods so you don’t have to learn all of them. Depending on the presort software you use, you may be limited in your choices, so get your service providers involved in this decision.

Step 5: Test your eDoc submissions Timeline: Late fall or just after the holidays after working with your service providers to get eDoc in your workflow, you will need to test your eDoc process with uSPS using the Test environment for mailers (Tem). The process as it stands today is manual and lengthy, but uSPS is working on streamlining this process. By waiting to test until late 2012 or after the holiday rush, you’re giving them time to refine the new process. Currently Tem testing takes a few weeks to a few months, but this time should be greatly reduced soon.

Step 6: Identify any remaining requirements Timeline: Late fall or after the holidays Depending on the mailings you send, you may need a Customer Supplier agreement (CSa), usually for First-Class mail, or to schedule your mail drops using FaST (http://fast.usps.com). Work with your local Business mail entry office to identify any other items you may need to cover to implement Full-Service.

Step 7: Start sending Full-Service mailings Timeline: Spring 2013 By following this schedule, you’ll be sending all your mailings via FullService well before the expected bottleneck at the end of 2013. a Kim mauch is a subject matter expert in mailing preparation and submission at Satori Software. Contact her at kmauch@satorisoftware.com.

www.MailingSystemsTechnology.com a may - june 2012

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Everything IMBC

With Kevin Conti & David Robinson

Pushing Toward Full-Service as reported previously, not only does POSTneT no longer earn automation discounts effective january, 2013, but Basic Imb is also retired as of january, 2014. Given the need for the uSPS to have the capabilities that fullservice Imb offers, it has stepped up its efforts to drive mailers to full-service. This is not surprising, as we’ve been hearing about the advantages that the full-service Imb offers the uSPS and many mailers. Beginning with the small and mid-sized mailers, the annual cost of manually processing over six million postage statements exceeds $100 million and, according to the uSPS, must be reduced. However, the challenge in getting these small and mid-sized mailers to utilize the capabilities of the full-service Imb has been the lack of incentive, the on-boarding process, and the overall education required to successfully complete the process. even in cases of full-service Imb software for low-volume mailers that was bundled and made available at no additional product cost, mailers had a reluctance to go through the laborious process of using full-service. Based on the difficulty in onboarding and the overall process, the uSPS has been working with the vendors as part of the mailers’ Technical advisory Workgroup (mTaC) to develop an easier means of using full-service for these mailers. One of the major improvements under consideration is having vendors of PaVe (Presort accuracy Verification and evaluation) software certify their full-service Imb software directly with the uSPS. Once the vendors certify their software with the uSPS, the customers using this software would not have to recertify that the software using the Test environment for mailers System (TemS). This will save a significant amount of time in submitting full-service mailings. Continued effort is also being made to reduce the complexity and education required to create and induct full-service mailings for mailers of all volume ranges. For example, the uSPS is enhancing Postal Wizard to provide full-service Imb statements for mailings of less than 10,000 pieces. Stay tuned as we can expect changes to encourage small and mid-sized mailers to implement fullservice sooner rather than later as the full-service requirement isn’t that far away (january, 2014). For mid-sized and up to enterprise level mailers, the uSPS is continuing its work on Seamless acceptance and eInduction. eInduction is another full-service initiative and one that we haven’t touched on much previously. eInduction is the electronic

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Seamless Acceptance — What’s in It for Me? The benefits to the USPS for Seamless Acceptance are significant in terms of reducing the costs associated with inducting mailings. Those companies that participated with the USPS as part of a pilot effort have also determined that there were several costly steps removed from the process when implementing Seamless Acceptance. So, everyone wins! induction process that leverages existing electronic documentation, Intelligent mail barcodes, and handheld scanner technologies to verify payment for the mail at a container level and ensure the containers are inducted into the correct destination facility. Increased use of electronic data through the eInduction program will reduce the dependence on paper-driven processes, directly reducing the amount of manual validations conducted on shipments at destination plants and reducing paperwork and work hours for PS Form 8125/8017 preparation at Dmus. eInduction is currently pilot testing the functionality to allow a paperless induction process, including testing of Surface Visibility (SV) device functionality, user training, ongoing system tests, and positioning for national deployment. The uSPS will continue to make it easier and more attractive for mailers to consider all the benefits of using full-service Imb. In addition to the operational benefits that full-service mailers enjoy, there are hints that the current full-service Imb discounts will be increased. We don’t know if, when, or how much for sure, but it would likely be announced later this year in preparation for the 2013 rate changes. now that the full-service Imb is required for automation rates by january, 2014 (and for any future mail promotions beyond the 2012 mobile barcode incentive), why wait? migrate now and take advantage of the added value and free visibility that fullservice Imb delivers. a Kevin Conti is Director of mailing Solutions at Pitney Bowes Software. David Robinson was recently named Client engagement Leader and formerly served as the Director of address Quality for Pitney Bowes.


Ship It

With Jim LeRose

Is the USPS on Track? An e-commerce consumer became anxious due to the fact her delivery had not arrived when she expected it, so she called the customer service department to track it down. OK, so this happens every day, right? The significance of this particular event was that the call transpired after she had already received delivery. The package was sitting on her front porch for all to see, but she was unaware because she didn’t look. Instead, this shopper relied on the web tracking information that displayed “still in transit” and the CSRs from where she made the purchase that had the same information. The carrier was the USPS, who provided a flawless delivery but hadn’t updated its website with delivery information in time to calm our anxious consumer. This is one example that highlights why many consumers opt to use more expensive services provided by UPS and FedEx, both of who provide real-time package tracking. The difference in the cost of a one-pound package is staggering with UPS/FedEx, costing about $9.00 for Ground Residential (one to six days) service while the USPS charges about $3.00 for a First Class Package (two to three days). For long-range shippers, the USPS usually delivers a lot quicker, even at the lower price point. The tracking problem is equally frustrating for e-commerce companies that must staff up to answer these calls. For consumers and e-commerce companies alike, there’s good news: This problem is about to become a thing of the past.

Along with reliable service, great tracking and lower cost, consumers have an option to get competitively priced insurance from a USPS Preferred partner, U-PIC, who will provide up to $25,000 (approvals needed) of protection per package. To make it even more convenient, U-PIC’s insurance is integrated into DYMO Endicia’s (listed as: “Endicia Parcel Insurance”), making it easy for customers to purchase. So there you have it: YES! The USPS is “On Track.” If you haven’t already, give the USPS a try and let me know how it works out. a Jim LeRose is Principal of Agile NYC Metro and President of Advantaship.com. Jim has been a transportation industry consultant for over 25 years and helped his clients save millions on transportation costs. Contact jim.lerose@agile-network.com or 888.214.1763. You can also visit his blog at www.agilenewyork.com.

Currently USPS personnel scan a package at the moment it is delivered. However, before it gets posted online, the scanner must be physically docked at a postal facility, which can cause hours of delay and, in this case, it’s what caused our e-commerce consumer to “zone out.” The USPS recognizes this shortcoming and has decided to stamp out older technology. This will enable consumers to get the most reliable home delivery service, pay less (a lot less), and get real-time tracking, including delivery notifications.

CURRENT & FUTURE OFFERINGS The USPS already offers in-transit tracking using technology called IMpb on Parcel Select, First Class Package, Priority and Express mail. In 2013, this service will be expanded to include real-time Delivery Confirmation, at no extra charge. Of course, that’s as long as you utilize PC technology to create your USPS shipping labels (no hand-written address labels, please), a service provided by many companies, such as DYMO Endicia, and included with many multi-carrier shipping apps.

www.MailingSystemsTechnology.com a MAY - JUNE 2012

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Special Guest Column

An Opinion on Do Not Mail Supporting the Do Not Mail List? Heresy!

Heresy: any belief or theory that is strongly at variance with established beliefs, customs, etc. (from dictionary.com) It is time to close your eyes, pinch your nose, and open your mouth (and your mind) because what I am going to propose will taste like a dose of cod-liver oil. you may also want to sit down to keep from fainting. now with your eyes closed‌ start thinking of all the advantages of putting the uSPS in charge of a national Do not mail list.

address were to move during those two years, the address would immediately be taken off of the Dnm list by the delivery unit manager. Only residents could sign up for the unaddressed advertising mail Dnm list; no agent communications (such as from Catalog Choice) would be accepted.

The most current assault by Catalog Choice on the direct mail industry is over eDDm mail. They and other anti-mail zealots hate this postal product’s attempt at making it easier to generate more mail. Their current angle of attack is to condemn those companies and schools that refuse to remove individuals from eDDm (saturation) mailing lists. Catalog Choice has provided a petition (http:// www.citizensformailchoice.com/) that is to be sent (by email) to the Postmaster General. In the petition it requests that penalties be established for offending organizations. Catalog Choice knows that the arcane and bureaucratic Do not mail (Dnm) procedures established as part of eDDm, combined with substantial penalties, will significantly reduce mail volume.

The Postal Service would maintain two delivery stop counts for each route. One route count would total all possible deliveries, as they do today. The other count would be the total deliveries on a route less the number of addresses on the Dnm list for that route. Politicians (never to be limited in their ability to provide us with useless information) could continue to mail to everyone on a route. everyone else would only have access to the addresses not on the Dnm list. Carriers would know which addresses were on the list and would be responsible for not delivering any unaddressed advertising to those who had signed up as a Dnm delivery stop.

Since the uSPS inspired this renewed assault on our industry by developing eDDm, I think the uSPS should be responsible for cleaning up the mess they created. When it comes to producing unaddressed advertising mail our industry gets all of its information from the Postal Service. It owns, manages, updates, and distributes the information used to produce and deliver eDDm mail. The Postal Service knows when new homes are added to routes, when route realignments change route numbers for existing addresses and when people move into and out of neighborhoods, regardless of whether they file a change of address card (COa) or not. Our industry’s goal should be to have access to as many mailboxes as possible without forcing our advertising on people that do not want it. The way Dnm should work for unaddressed ad mail is that people wishing not to receive advertising would leave a signed form (available from their carrier or online) in their mailbox for their carrier to take back to the local delivery unit. The local delivery unit manager would put that address on a master Do not mail (Dnm) list for that delivery unit. They would also reduce the allowed number of addresses for mailing unaddressed advertising to that route by one. The address would stay on the Dnm list for two years, when the Dnm request would have to be renewed. If the people at that 14

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mail owners would produce printing and pay postage based on the total allowed delivery addresses. Saturation rules would be based not on total delivery stops but on the total number of allowed deliveries. So if there were 500 total deliveries on a route and 25 addresses were on the Dnm list, then the number of possible deliveries for that route provided to mail owners would be 475. If the mail owner mailed to 90% (current rule) of the 475 allowed delivery stops, they would then be able to claim all saturation rates as they do now. Therefore mail owners would only purchase enough printed material and pay postage for the number of allowed deliveries (475 in this example). The uSPS would not be throwing away our mail and postage for those addresses not wishing to receive unaddressed advertising mail, as some carriers do now. With this proposed new system, mail owners can never be held responsible for failing to honor Do Not Mail requests for unaddressed advertising mail. as for addressed mail, the uSPS should play a role here also. The way a list for Dnm addressed mail would work is that mail recipients would use current change of address (COa) procedures to put their name and address on a national Dnm list. Consumers would enter their name and address on COa cards (or online) and flag the fact that they do not want to receive


With Todd Butler

advertising mail. As mail owners matched their files to the NCOA database, records with a DNM flag would identify addresses for exclusion from their mailing. This process would be simple, easy to administer and inexpensive for the entire direct mail industry. As people moved, their old address would be removed by the USPS from the DNM list automatically. Both the DNM list for unaddressed advertising mail and the separate list for addressed ad mail would be an all or nothing listing for consumers. So if a consumer signed up because they didn’t want an EDDM coupon from the local dry cleaner, they would also not receive unaddressed coupons from their grocery store. If a consumer went online and registered their name and address through the change of address procedures for no addressed advertising mail, they would not get any addressed ad mail. An exception to the NCOA DNM flag would be made for existing customer relationships. All or nothing keeps the process simple for our industry to manage and retains the maximum number of allowable addresses to mail too. I believe most people would not sign up for DNM under an all or nothing circumstance. Most will accept some unwanted unaddressed advertising to make sure that they get their grocery coupons. Our industry has been pushing the concept that we must refine our mailing lists and target recipients more accurately. As mail owners push harder and harder to reduce costs by reducing the number of mailpieces printed and distributed, it would seem logical that the first cut in targeting would be to eliminate those that do not want their advertising. It is time for our industry to honor DNM requests. What is clear is that Catalog Choice and others like them, the FTC, and Congress will eventually coalesce around one Do Not Mail legislative solution. The fact is that neither we nor the USPS will be happy with their solution, which will do far more than just create a DNM list. We can live with Do Not Mail as outlined above. We will not survive regulations that start out to limit whom we can or cannot mail to, but morph (as legislation does) into limiting our ability to collect and use information about existing and/ or potential customers. With the USPS providing a simple and effective Do Not Mail process, it would be less likely that the FTC or Congress would step in to fix something that has been resolved by another government agency. The choice is clear: let Catalog Choice, the FTC, and Congress determine our fate, or chart our own course. a Todd Butler, Butler Mailing Services, eKEY Technologies can be reached at 513.870.5060, toddb@butlermail.com or www.ekeymailer.com.

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Defining Best-in-Class Mail Operations

Adam Lewenberg


There is an elite club in mail services. It is the top mail managers who we see at every industry event, who are connected with their peers both locally and nationally. They run the best operations and get the best rates. My goal is to share strategies of how these managers set up and run best- in-class mail operations for maximum efficiency and savings.

Automate Incoming Package Delivery If you are receiving over 25 items per day from UPS/FedEx or accountable items from the USPS, I would strongly recommend having an electronic tracking system to automate this manual task of logging in packages. The basic components are a software program loaded onto a PC, a connected scanner, and, typically, one or more portable scanning devices. When the packages come in, they get scanned and matched to the person or department to where they are addressed. When the items are delivered, the recipient signs the portable handheld device to prove final delivery. This is the ultimate CYA (look it up if you are unsure what that acronym means) in a mail center and eliminates responsibility for lost packages. It also creates a faster, paperless process. Even if you already have an incoming tracking system, these are some of the newest trends you may want to consider to streamline package tracking:  Cloud-Based vs. Loaded onto a PC – This is a great option if you have multiple locations because you can receive at different sites and link to the same internal databases. It also helps the end users, who can check their package status online.  Email Package Notification – Many times packages are delivered, but another option might be to have recipients pick up at specific designated points. Most systems can be configured to automatically email package notifications.  Link Digital Pictures of Damaged Items – You do not want to be responsible for items that come in damaged. Many tracking systems can allow you to upload digital pictures of damaged or suspicious packages. These pictures can be emailed to the final recipient to let them know their package came in damaged or to see if they were expecting an item that looks questionable.  Scan USPS Accountable Items – This sounds obvious, but many entities are using their system for UPS and FedEx only. More USPS items are coming in with Delivery/Signature Confirmation labels as well as the typical Express and Certified items.

Take Control of Undeliverable as Addressed Mail Returned mail because of poor addresses costs businesses billions of dollars in lost opportunity. The best-in-class companies are managing this in three ways:

1. Update mailing lists to make sure you have the right address and any Move Update information. If you are barcoding your mailings in-house, you have a software program that does this for you automatically. Make sure you have a National Change of Address (NCOA) service that is connected to your provider. If you are using a third party mail service, get any address changes back so you can update your databases for the future. 2. Migrate to the full service IMB barcode (mandated by the USPS by 2014) because of the features it offers. Not only do users get an extra discount on their mailings, but they get nocost electronic address correction notifications. 3. Have a documented process on how returned mailpieces get handled and that the information is getting updated back into the main systems. (You would be surprised how many companies don’t do anything with their returned mailpieces.)

Make the Best Insource/Outsource Decisions This is not as easy as you would think because there are so many variables to consider. We are going to look at two types of outsourcing: mail fulfillment companies and presort service provider.

Mail Fulfillment Companies: These service providers, sometimes called Mail Houses, will perform mailing services such as printing, folding, inserting, addressing, presorting, and transporting to the USPS. It has gotten more confusing because many printers are offering mailing services as well. It is important to know the detail of what you are paying for to make sure you are getting the best rate, to compare against other providers, or to determine if the work should be brought in-house. The key thing to look for are the fees that are outside the per-piece charges. Most providers will charge set-up and delivery fees that are fixed regardless of the mailing size. This is fine when you are sending out 50,000 pieces, but a $200 set-up fee for 1,000 postcards means you are paying $.20 per piece plus the processing charges. To determine what should be done in-house, look at the makeup of your mailings. If most of the projects are less than 5,000 pieces and you have the proper staff, space, transportation (to get mailings to the USPS), and some simple equipment (printers, folder/ inserter, and postal software), this could be your least expensive bet. Make sure you do enough mailings to make the investment and time worthwhile. Regardless of which way you go, it is a best

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practice to review your mailing data at least once per year to make sure you are doing your projects in the least expensive way possible to meet your desired objectives.

Presort Service Providers – These services pick up mail at your office, run it through their sorters (that break it down as close as possible to their final destination), and schedule it directly into the postal system. They are great to use because they can get you discounts with minimal effort and potentially move mail faster through the Postal Service. This is an easy one from an in-house/outsource perspective because it is a simple financial transaction. If the presort provider can move your mail at lower costs than you can do it yourself and the delivery impact does not negate the savings, use them. Here are the best applications for this type of service:  You have mixed department mail that would not qualify for any discount on its own. These services can typically give you at least five to 15% discounts on your mail. Typical minimum volumes are 500 pieces per day or single pickups of 1,000 pieces.  You are automating your mail today but the presort service can get you better rates due to their density of mail by comingling with their other customers.  You are automating Standard Rate mailings and the presort service can get your mail drop shipped to the delivery address USPS Sectional Center facility splitting the destination entry discounts offered by the USPS.

Have Very Detailed Reporting The best mail operations will have very detailed reporting on their operations. This is the only way to have consistent visibility to how their operations are performing. Here are some key areas that need detailed documentation:

Postage/Shipping Spend – This can be very difficult to get because of the amount of places it needs to be collected. The better this is managed, the more power it creates inside your entity. I recommend having the 12-month detail of the spend categories below accessible and reviewed frequently:  USPS Permit Spends – There could be multiple permits, and all need to be accounted for. I have seen many companies lose track of accounts with funds that sit idle and, in some cases, are never recovered.  USPS Metered Spend – This can be pulled from the system or from the vendor websites.  USPS Cash and Credit Card spend – There could be people in your organization working out of their homes or travelling that need to mail items and pay with petty cash or credit cards. It is a good idea to monitor this expense to make sure it does not get misused.  UPS and FedEx Spend – This spend should be looked at alongside postage because there could be savings opportunities moving specific items between the carriers. Also, there are many carrier fees and delivery guarantees that should be looked at to make sure you get all refunds possible.

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Mail Service Provider Fees – The best companies look at their invoices regularly and know exactly what they are paying for. These service providers can charge fees in many different areas that can make the costs much higher than originally expected.

Staff Productivity – I left the most significant for last since the best operations will have detailed performance metrics for their people. This will show them very important information on how their operation is being managed. Here are some examples: } } } }

mail Produced, metered, Sorted by employee Internal Pickup and Delivery by employee Sick days and overtime required Customer service complaints by employee

Staying Connected It crucial for mail managers to stay connected inside the industry because of all of the dramatic changes going on with the uSPS that will affect all of us. The uSPS is about to close over half of their Sectional Center Facilities, thousands of retail locations, slow down mail by up to a day, and require a different barcode placed on the mail. I am on the board of my local Postal Customer Council (PCC) and mail Systems management association (mSma) and I am amazed how few companies show up to events that go over these changes. Here are some of the best ways to stay involved and informed about these changes and best practices in the mailing industry: } Join your local PCC and MSMA Chapter – They are the best source for how these changes will impact your mail locally. } Get Certified – There are some industry certifications that make sense in understanding all of these changes. The mSma offers a mail Design Consultant (mDC) and a more involved Certified mail and Distribution Systems manager (CmDSm) that may be worth looking into. } Join Mail Groups on LinkedIn – members can ask questions, give advice, as well post the most up-to-date media stories around mail. Some groups that I belong to and like are “mailing Systems Technology” (It is really good — I am not just listing it because you are reading this periodical), “mail Geeks,” “national Postal Forum,” and “Document Handling and mail Process Professionals”. We are about to go through the most rapid postal changes any of us have experienced. This will require the best oversight and management to optimize operations. The key piece to managing best-in-class operations is not to try to do everything but to know what is available and choose what makes the most sense in your own operation. adam Lewenberg, CmDSS, is President of Postal advocate Inc. with over 19 years of experience in the mail industry. Postal advocate’s mission is to help entities with large numbers of locations reduce mail related expenses and make the spends easy to manage. adam can be reached at 617.372.8653 or adam.lewenberg@postaladvocate.com.

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reality Check

With Wanda Senne

You’ve Won!

Congratulations! you were just selected as mailing System Technology’s Industry Person of the year! as you prepare for your interview (story to match your smashing cover photo) you will be asked, “What are the keys to your success?” What will you say? Over thirty years ago, the mailing and Fulfillment Service association (mFSa — then maSa) asked 23 successful managers that question. (Thanks to C. Scott Schuh with LSC marketing, Inc. for cleaning out his archives and sharing.) Do you think the answers would be vastly different today? Or do you subscribe to the jean-Baptiste alphonse Karr january 1949 quote, “The more things change, the more they stay the same.” When asked what that really means, a proverb observed: turbulent changes do not affect reality on a deeper level — other than to cement the status quo. What did those successful managers write in 1980? although a variety of ways to express success, over and over again they focused on one element: people. } “Thank people for a job well done.” Gene Kane } “Recognize achievement. I progressed from the truck driver (looking for something to do) to the president of the company (looking for something to do) — and having an exciting and enjoyable time doing so.” merlyn W. Webb } “Blindness to office politics or worrying about what the other guy wasn’t doing.” Robert moonan } “I do not have all the answers — learn from others. Hire the best available person for any position. Best doesn’t always mean smartest, or most skillful. The best person will accomplish goals by working with others on a team.” Wally Bernheimer } “Surround myself with potentially successful people, understanding their desires and frustrations, and letting them do their jobs.” Bob Garlington } “mistake #1: trying to do everything yourself instead of training someone else — doing instead of getting work done through people.” Shirley Wilkowski } “Honesty, character, judgment: power of a great team. Success is contagious and must be shared with others: recognition.” Robert Buckingham } “Three parts to a job (used to rate at 40-40-20, and now 10-10-80): } Knowing where to go to get what you need } Knowing what to do with the data you get 20

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} Knowing how to get along with people so the first two get done” ed Burnett } “Hire good people and take care of them.” e.W. Karkhut } “Hire good people and give them responsibility.” mike Simon } “Delegate to qualified people.” joe Cohen } “Key people around me to handle all the details — I do not want to be a hero and run the whole show myself.” arthur Tucker } “I work with and for the other employees of my company. my job as a manager is to make these people successful.” aaron Osherow } “Concern and responsibility for other people.” Bill David my favorite contribution from these 23 managers is this poem highlighted by Bill David. I think it still holds true today.

What Is Success? Success is speaking words of praise In cheering other people’s ways. In doing just the best you can With every task and every plan. It’s silence when your speech would hurt, Politeness when your neighbor’s curt. It’s deafness when the scandal flows, and sympathy with other’s woes. It’s loyalty when duty calls; It’s courage when disaster falls, It’s patience when the hours are long; It’s found in laughter and in song. It’s in the silent time of prayer, In happiness and in despair. In all of life and nothing less, We find the thing we call success. - Anonymous Will you include people as one of your key success factors? a generic Web search just today generated over 248 million results for the key words, “people key to our success” — after 30 years, the reality is that some things have stayed the same. a Wanda Senne is the national Director of Postal Development for World marketing. Contact her at wsenne@worldmarkinc.com or 770.431.2591.


Pushing the Envelope

With Kate Muth

Transformation over 25 Years

T

wenty-five years ago I was getting ready to graduate from college, anxious to enter the workforce and earn a paycheck. (I know, I don’t look a day over 30, but that’s partially because this magazine runs a dated photo of me.) I wanted to be a college professor but the idea of grad school and more student loans kept me from pursuing that goal. Instead, I did what countless other graduates in the late 1980s did: I mailed out hundreds of resumes to job openings I saw listed in the classified section of various newspapers.

biggest successes. The combination of worksharing and personalized marketing, which relies on sophisticated databases and data-mining programs to target direct mail, provided a potent and winning combination for mail. In some ways, this successful model has been replicated in the digital world, as companies use data mining to send targeted advertising electronically rather than by mail. The billion-dollar question is whether consumers will respond in the same way to digital ads as they have to the more traditional forms of advertising.

My previous sentence illustrates just how much things have changed in the 25 years since Mailing Systems Technology launched. First of all, classified ads are practically non-existent. Sure, you see a slim section in the newspaper on certain days of the week, but anyone buying or selling services doesn’t rely on newspaper classified ads any longer. Craigslist, eBay, and Amazon — and a host of other online services — have made classified ads practically obsolete. And I don’t know any graduates from the past decade who mail their resumes to anyone. They email them to human resources departments, upload them to a website, or fill out an online application. The world has changed dramatically in the past 25 years, with the information age ushering in a whole new way of communicating and doing business. Digital, instantaneous communications have transformed entire industries, including newspapers, the larger publishing industry, the music industry (from CDs to iPods and streaming music), the telephone utilities, and, of course, the Postal Service.

As we look ahead to the next 25 years, the future may not seem quite so bright for the Postal Service. Its current financial challenges and the changing nature of communications make it hard to see the next big thing that is going to drive revenues for the Postal Service and keep it viable. But, I’m pretty sure that in the mid 1970s, when Reader’s Digest petitioned the Postal Service and its regulator for a discount for sorting mail, few, if any, predicted the huge snowball effect this effort would have. Worksharing transformed the mailing industry. The next big thing to revolutionize this industry for another 25 years could be out there. Let’s give the Postal Service the tools it needs to discover it. a

In 1987, the Postal Service was in the heart of its boom years. Worksharing, which was initiated in the mid 1970s, got its legs in the 1980s as more and more mailers took advantage of the lower-priced bulk postage rates and did mail preparation work on their own to qualify for those rates. Total mail volume in 1987 was about 153 billion pieces of mail and had been experiencing steady year-over-year growth in the decade of between about three percent and 10%. But the real story was in the growth in workshared mail. First Class workshared mail enjoyed double-digit percentage increases in every year of the 1980s except two. Standard Mail also grew at a steady clip. Many long-time postal observers call the Postal Service’s introduction of worksharing to be its greatest success story. Worksharing, which allows mailers and service providers to use their own systems and logistics to prepare and enter mail, essentially opened the upstream portion of the postal system to competition. This helped to keep mail affordable and make it attractive as a communications medium, which in turn helped to spur the explosive growth in direct mail — another of the Postal Service’s 22

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Kate Muth is President of Muth Communications, a writing, editing and consulting firm. Contact her at katemuth@comcast.net.

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ApplicAtion Article

The Power of Data – part 1 Mike Maselli, Bell and Howell Vice President, Marketing and Product Management

With companies that manage their own communications who are trying to stay competitive and relevant and those that perform communication services for others, we often engage in discussions about ways to: • improve profitability • increase operational quality and integrity • adhere to, and stay ahead of, postal regulations • know and leverage best practices • keep current with technologies and trends • stay competitive And when the topic shifts to their recipients, the discussions include being able to: • elevate message impact and personalization • offer a clear understanding of what information is available where • provide multiple options for how they can communicate - print, web, mobile, .. New technologies, flexible acquisition and usage models and lowcost hosted services accelerate the ability to build a data-rich environment to manage your business in ways more profitable than ever before. There are different types of data and ways to acquire, manage and use the information to help improve your operational bottom line and your customer communication results.

Defining the Role of Data

acquiRing Data Understanding how data can be used to solve problems is often more obvious than how to acquire data. The answer could be starting a new project to mine existing data sources for information to use for integrity and marketing reasons, like billing and print files, or data that has been stored in an archive system for accessing historical account activities, or operational data from a production floor for quality and productivity reasons that may be only accessible today by system operators. In some environments new production technology will be required to manage a system or a process and collect information. Options include purchasing a new system with embedded intelligence, or adding intelligence to legacy products in order to gather the same production-related information. Today these systems are more flexible and powerful than ever, and the data collected and stored is rich with opportunities for reporting and analysis. Another option is to extract information from finished products – such as a printed page or a mailpiece. There is a lot of information that can be taken from an item including a unique identifier for tracking, instructions for how to prepare, finish and personalize the item, the stock that is either carrying the account information or inserted alongside, the quality of how it was printed and prepared, postage costs, and many other quality and integrity data points. The third option is simply to pay for data. Many companies today are offering high-value, low-priced services that provide access to very useful information.

Data is a company’s most powerful asset. Powerful in the sense that people with access to relevant and current data can make intelligent decisions that are based on information and analysis. And those trying to operate without a good grasp of business and customer-related information will inevitably end up taking many unknown risks whose impact is not easily measured.

Managing Data

The discussion items listed above can all be addressed if the right data is made available to the right individuals tasked with fixing them. Information related to accounts, end-user activities, demographics, operational metrics, delivery preferences, postal, and marketing data each provides value to one or more parts of a business, but are even more valuable when networked and integrated together.

© 2012 Bell and Howell, LLC. All rights reserved. Bell and Howell and the Bell and Howell logo are trademarks or registered trademarks of Bell and Howell, LLC. All other trademarks and service marks are the property of their respective owners. Specifications are subject to change without notice.

Today’s communication world is changing fast–moving from static to dynamic, from black and white to color, from print to electronic, and from being defined for the Generation X (ages 32-47) audience to being redefined for the Generation Y (ages 18-32) audience. Generation Y is shifting the control of communication from businesses to consumers. According to a USPS report, 40% of the US population will be Generation Y by 2020, with communication preferences primarily digital.

After planning what data will provide the most value, and putting together tools and projects that enable use of that data, the next topic to discuss is how to manage the data so that as many users as makes sense will have access, and we’ll cover this important topic in the next in this series.

Bell and Howell www.bellhowell.net marketing@bhemail.com


It’s a Boy… It’s a Girl…

It’s a Magazine! The creators of Mailing Systems Technology overcame nay-sayers, initial cash flow issues, and tedious design processes to give birth to the premier magazine in the mailing industry. And after 25 years, it’s still going strong! By Marll Thiede “I have this idea.” That is a common statement I have heard from Ron Brent over the years. But one idea he uttered 25 years ago seemed to have merit. at the time, Ron was selling mailing and shipping equipment for his father john’s company in madison, Wisconsin. as he went from business to business, his customers would ask him, “Where can I get aBC?” or “Do you know anyone who does XyZ?” It dawned on him that here was an industry — the mailing and shipping industry — that didn’t have a source of information about mailing and shipping operations. There were some newsletters that addressed Postal Service issues, but none that touched on equipment and management. and the light bulb went on. Ron approached Greg Rice, who at the time leased space to Brent’s mailing equipment, to seek business advice about starting a publishing company. Greg, realizing the company did serve a “hole in the marketplace,” wanted to become an equal partner in the business and would help Ron seek financing for the venture. With 24

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Ron’s industry expertise and Greg’s business savvy, they needed someone to run the day-to-day operations of the company since Ron needed to continue to work for his father during the startup. They asked if I would like to work for the company, and they would give me 10% ownership. I chuckled and turned the offer down, but countered with, “I’ll do it as an equal partner.” So I quit my secure job, pulled out my retirement money to live on, and took a leap. The three partners were now ready to start a “publishing empire.”

Building the Empire Our first major task was to get money to fund our first issue. When we approached the banker, his response was: “mailing? I can see you having enough information to produce one magazine, but what will you write about after that?” If only you could have seen into the future, mr. Banker! Twenty-five years later and we still have plenty to write about. But while he had concerns, he did give us $40,000; unfortunately, it was not enough, at the time, to


THE ORIGINAL BOARD OF ADVISORS Without this group of dedicated industry professionals, Mailing Systems Technology could not have realized its 25 years of success. These members helped guide the first few years of editorial content and gave us the strong foundation of writing about issues that are important to the day-to-day operations of a mail center. Ron Betz, Wisconsin Power & Light Jim Bodi, Bodi Engineering Bob Johnson, Print & Mail Bill Kalscheur, USPS Paul Lewandowski, American Family Insurance Dale Miller, Perry Printing Gail Nickel, USPS Dan O’Rourke, University of Wisconsin (later Editor) Bob Pierce, TDS Computing Services Deborah Thomas, Garrett Thomas Company

cover printing, postage, and our operating expenses. Advertisers were not jumping on board for the first issue, either.  “A mailing magazine has never been done.”  “Will it last?”  “Who will you send it to?”  “It really isn’t needed.” were among the reasons Ron heard from advertiser after advertiser. Maybe they didn’t believe, but we did. So, we gave away ads in the first issue. With little startup money, Ron headed to the University of Wisconsin’s School of Journalism to find students who would be willing to write articles in exchange for getting them published in a national magazine. It worked. We had a team of about six writers to tackle the articles. Ron also found a budding graphic artist at the school who would lay out our first issue. Looking back, the technology used to produce a magazine was cumbersome, time-consuming, and expensive. Old typesetters were on their way out, and that new-fangled Apple computer promised to make publishing easier. But it seemed to take forever to take handwritten articles or articles on incompatible IBM floppy discs and type them into the Apple computer, lay out the article column by column, print out the columns then paste them up on boards which we shipped to the printer, who made the proofs, who shipped us the proofs, which we shipped back to the printer, who made the plates, who printed the issue… Ah, thank you almighty geeks for technology. What took more than a month now can take less than a business week. I remember delivering the premier issue of MAST (Mailing and Shipping Technology, the original name) as if it were one of my very own daughters. Unlike my “perfect” baby daughters, however, the first magazine had some flaws! None of us had experience in publishing and it showed. The content, conversely, was excellent according to our first readers. The articles were first-rate because we had gathered a group of advisors who worked in the industry and guided us as to what they would want to read about in a mailing and shipping magazine. They defined our editorial content around equipment/technology, management, and Postal Service know-how — themes we continue today.

The premier issue was unveiled at the National Postal Forum, and the response from industry vendors was encouraging as well. In fact, Don and Dave with Mail Solutions gave Ron a contract on the spot. They believed in the magazine, they recognized the need for it in the industry, and they understood the importance of signed contracts for a startup business because they had faced similar issues in the startup of their (now very successful) company. Subscriptions began trickling in; not exactly the response we had hoped for. But the publishing and business world were in flux. We were charging for a subscription, and as companies were making budget cuts back in the day, subscriptions were the first to go. So the publishing world was changing its model to have business magazines be free to subscribers and be fully supported by advertisers. Wow, what a quandary for a startup! We couldn’t get the advertisers and couldn’t get paid subscriptions. But by the end of the first year, we had advertisers and plenty of subscribers! We saw a light at the end of the tunnel. And we kept growing over the next 25 years. There were difficult times for sure, but the industry — both mailing professionals and vendors — kept valuing our efforts, which made us continue to strive in good times and bad. For me personally, there was risk, but the reward far outweighed the risk. I feel we helped shape the mailing industry over the years, taking it out of the “basement” (as Dan O’Rourke wrote about in the first issues) and elevating it to the powerful and well-respected industry it is today. We often said that mailing is the lifeblood of any business. And even today in the e-everything world, mail continues to play a pivotal role in business communications with their customers. After 25 years, it has been a pleasure to turn over the reins of our company to our very dedicated, long-term staff who are carrying on with excellence. I thank our staff over the years, the countless article authors, the many, many advertisers, our business partners (who were so patient in the lean years), but especially to the mailing professionals who have been our loyal subscribers. To all of us involved in the greatest industry, may we all have another 25 years of success! www.MailingSystemsTechnology.com a MAY - JUNE 2012

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A 25 Year

Rate-rospective By Margaret Cigno and Shoshana Grove Graphics by James Cigno

When Mailing Systems Technology was launched 25 years ago in May 1987, U2’s With or Without You was at the top of the Billboard music charts, the New York Giants were the reigning Super Bowl champs, and the First-Class stamp cost 22 cents. Fast forward 25 years: U2 made the Billboard charts, the New York Giants are the reigning Super Bowl champs, and the inflation-adjusted price of a First-Class stamp is 22 cents. It would appear that little has changed.

In the postal world, however, many things have indeed changed. The passage of the Postal Accountability and Enhancement Act (PAEA) in 2006 altered the system of postal ratemaking from a cost of service model, where the Postal Service was able to recover changes in cost of operations through rates, to a rate cap system where the rates at the class level are, in general, capped by the change in the consumer price index (CPI). The Postal Service deficit since reorganization (July 1, 1971) has grown from negative $2.9 billion in 1987 to negative $22 billion in 2011. Total mail volume grew to a peak of 213 billion pieces in 2006 before declining significantly. There was a marked difference between the five-year volume trend ending in 1987 and the five-year volume trend ending in 2011.

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In 1987, First-Class Mail made up 51% of the mail stream while Standard Mail (formally Third-Class) comprised 39% of total mail. In 2011, these percentages were 51% for Standard Mail and 44% for FirstClass Mail. This is significant because on a unit basis, First-Class Mail contributes much more than Standard Mail to overhead costs. In 2011 the average contribution per piece of First-Class Mail was 21.8 cents versus 6.8 cents for Standard Mail. Prior to 2006, the Postal Service proposed rates for postal products based on the revenue required to cover estimated costs in a projected test year. Mailers, through a public hearing process, had the opportunity to propose changes to cost methodologies and individual rates. The Postal Rate Commission (now the Postal Regulatory Commission) reviewed the information presented and recommended a set of rates that frequently differed from those proposed by the Postal Service. The entire

process, from preparation of rate proposals to implementation of rates, often spanned more than 12 months. This system of ratemaking changed with the passage of the PAEA. In general, under the rate-cap system, rates for mail classes cannot increase faster than inflation. The Postal Service proposes rate increases, users of the mail are given an opportunity to comment, and the Postal Regulatory Commission (Commission) has 45 days to approve the rates. During that 45-day period, Commission review is essentially limited to ensuring compliance with the CPI-based cap and certain worksharing requirements. Changes to cost methodology are reviewed in rulemaking dockets. The law permits mail users to bring complaints regarding rates to the Commission for resolution. In this article, we review how postage costs have changed over the past 25 years in relation to CPI.

For this historical comparison, we use revenue per piece for both First-Class and Standard Mail and the CPI for all items. Data for 2011 is used because that is the most recent full year of data available. The revenue per piece of First-Class Mail has remained below CPI since 1987 while the revenue per piece of Standard Mail has been above CPI. The divergence of Standard Mail revenue per piece and CPI occurred largely between 1988 and 1995, when Standard Mail revenue per piece increased 61% compared to an increase in CPI of 34%. Annual changes in Standard Mail revenue per piece during this time period ranged from a low of negative two percent in 1993 to a high of 13% in 1991. Over this same time period, First-Class Mail revenue per piece increased 40%, with annual changes ranging from negative one percent in 1994 to 10% in 1991.

www.MailingSystemsTechnology.com a MAY - JUNE 2012

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Since passage of the Paea, revenue per piece for Standard mail has been converging with CPI. The average annual increase in Standard mail revenue per piece prior to passage of the Paea was 3.4% while the average annual increase in the CPI was 3.1% for the same time period (19872006). The average annual increase in FirstClass mail revenue per piece was 2.4%. after passage of the Paea, the average annual increase in revenue per piece for Standard mail has been 1.8% and 3.1% for First-Class mail. CPI increased an average of 2.2% annually during this later time period (2007-2011). The revenue per piece figures reflect changes in mail mix (i.e., the proportion of single piece vs. presort mail). The annual increase in First-Class revenue per piece may reflect these changes to a greater extent than Standard mail revenue per piece. This is due to the relatively large rate difference between First-Class singlepiece mail and First-Class presort mail, and the decline in First-Class single-piece

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volume relative to presort volume. For example, the proportions of single-piece and presort mail in 1987 were 72% and 28% respectively. By 2011 these proportions had shifted to 39% single-piece and 61% presort. First-Class presort mail has a much lower revenue per piece than FirstClass single-piece mail (36.2 cents versus 52.9 cents in 2011). To further explore the changes in postage prices over the last 25 years, we compare the change in the cost of postage to the change in price indices for two other commonplace products. For consumers we compare the price of a First-Class stamp to the price indices of gas and milk. For commercial mailers we compare revenue per piece for Standard mail to the price indices of paper and ink. In making our comparisons, we use revenue per piece for Standard mail rather than individual Standard mail rates in order to capture the wide array of rates used by Standard mail commercial mailers. In contrast, individual consumers generally use First-Class single piece rates.

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We chose gas and milk for our consumer product comparison because, like FirstClass stamps, both of these products are commonly purchased by households on a regular basis. although we recognize that different factors may drive price increases for these products, the comparison lends context to postal rate increases. While electronic diversion has changed the purchasing pattern for First-Class stamps over the past decade, the comparison over 25 years is relevant. The cumulative percent price increases since 1987 for milk and First-Class stamps is roughly the same, while the increase in gas is more than double. Since 1997, gas prices have been more volatile than either milk or stamps. In 2000, gas prices increased by 28%. This was immediately followed by annual increases of 17%, 18%, 22%, and 13%. In 2009, the price of gas decreased by 27%, the price of milk decreased by 16%, and the price of the First-Class stamp increased by 2.4%.


For commercial Standard mail, we separated the cost increase of an advertising mailpiece into three components — paper, ink, and postage. as with the consumer comparison, we recognize that these components may have different cost drivers. However, the costs of these components are directly relevant to commercial mailers.

Since 1987, the price index of paper has increased 71%, and the price index of ink has increased 67%. The Standard mail revenue per piece, however, has increased 106%. There were two relatively large increases in Standard mail revenue during this period, an increase of 12% in 1988 and a 13% increase in 1991.

The aggregate increases since 1991 have been much closer in magnitude: 51% for paper (including a 26% increase in 1995), 44% for ink, and 48% for postage. Following passage of the Paea, the cumulative increase in Standard revenue per piece (9.1%) has been lower than both paper (14.2%) and ink (27.3%).

In recent years, the gap between postage price indices and CPI has narrowed. Both Standard mail and First-Class mail revenue per piece indices are now within 10% of CPI. Relative to other consumer products, the First-Class stamp, at seven percent below CPI, remains a bargain. although the price index for Standard mail is currently higher than the price index for both paper and ink, this may change over time. With postage

rate increases now capped at inflation for all classes of mail, it seems likely that the gap between Standard mail revenue per piece and CPI, currently at four percent, will continue to shrink.

ability? How will future postage rates be determined? Legislative changes may well shape the answers to these questions.

So, what will the Postal Service look like 25 years from now? Will rates remain affordable? Will volume declines level off? Will the Postal Service return to profit-

The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of the Postal Regulatory Commission.

as for us, we predict that the new york Giants will be the reigning Super Bowl champions, u2 songs will dominate the “Golden Oldies� charts, and the inflationadjusted price of a First-Class stamp will be 22 cents.

www.MailingSystemsTechnology.com a may - june 2012

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Looking Ahead: Building Value in the Mail Reaching for 100% product visibility by 2014

jim Cochrane is the self-described “evangelist for collaboration” for the united States Postal Service. The vice president for Product Information is on a mission. He wants the Postal Service and the mailing industry to work together to make the mail 100% visible by 2014.

100% visibility that will benefit major mailers, small and medium businesses, and consumers. not only will service improve, he explained, customers also can use technology to create marketing campaigns based on the data they’ll receive using the Imb.

That means customers will know in real time where their mail or packages are in the postal network and precisely when they’re delivered. He said the Postal Service is now testing new scanners for use by letter carriers that will capture and transmit data in real time.

Full-Service Intelligent Mail offers a number of advantages to mailers. These advantages include: } unique barcodes enable the Postal Service to provide mailers with comprehensive information on the status of mailings as they progress through the postal system. This includes the date and time of receipt by the Postal Service, handling of containers and trays, and piece scans as individual pieces are sorted on postal equipment. } Visibility allows mailers to more effectively respond to customer inquiries on the status of valuable bills, statements, catalogs, and publications. } Full-Service mailings receive access to free address change information and tracking information from mail entry to final destination. } Waiver of annual mailing fees for permits where all postage statements contain 90% or more Full-Service pieces. } using Intelligent mail barcodes and eDocumentation will provide access to eInduction, a streamlined mail acceptance process that eliminates the need for paper documents such as PS Form 8125. } Seamless acceptance, an automated verification process, will provide Full-Service mailers efficiencies across the supply chain, preparation and payment flexibility, and standardized acceptance and verification processes.

To meet the goal of 100% visibility, Cochrane told an audience of mailers at the national Postal Forum (nPF) they must “embrace the future” and universally adopt the Intelligent mail barcode (Imb). He said the ending of POSTneT as of january 2013 is the next step in the transition to 100% visibility for packages and the mail. using Imb will allow uSPS and the mailing industry to “use information and technology to build value in the mail.” In january 2009, the Postal Service offered the mailing industry two Intelligent mail barcode (Imb) options for automation discounts. The options included the “Full-Service option”, requiring unique Imbs, and the “basic” Imb option, which does not require unique barcodes. Currently, a large number of mailers are using the Full-Service and basic Imb and enjoy the additional benefits and value of using these options. as part of the continuing evolution of data visibility, the Postal Service is planning to move to the Full-Service Intelligent mail option to qualify for any automation letter, postcard, and flat prices, effective january 2014. Only Full-Service mailpieces would be eligible for automation pricing. “With Full-Service, visibility into the flow of mail throughout the postal network will be improved,” said Cochrane. Cochrane said the Imb already is being used to dramatically improve service performance through scanning. He said packages routinely receive up to 10 scanning events as they pass through the uSPS network and the Postal Service wants to provide similar visibility to letters and flats. mailers can make good use of real-time tracking of all mail to add value to their products, Cochrane said. He’s mapped a strategy for 30

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The Postal Service is working with mailers, software providers, and mail service providers to help them make the transition to Full-Service by january 2014. The Postal Service has created the Intelligent mail Small Business (Imsb) tool, which creates Intelligent mail barcodes on outgoing mailings. The Postal Service also is testing “mail anywhere,” allowing mailers that make the transition to Full-Service to use the same permit to mail from any location in the country. “embrace new technology and work together with us to improve bottom lines,” Cochrane said. “Full-Service Intelligent mail makes good business sense.”


Future oF Mail Viewpoints

A Look Back, and a Look Ahead 2011 was a year of change and refocus for the industry, as well as Bell and Howell. What started out as a year of uncertainty with many questions about the future of mail, the Postal Service and every business involved, by mid-year we began see new clarity, a new sense of purpose, and a new attitude. And to make it really interesting, at the same time the marketplace was going through a technology-driven series of changes that would forever alter the business of communications. Increased usage of digital color in every communication piece, personalized and targeted messages becoming the norm, fast adoption of new technologies such as tablets and smartphones by consumers and workers who are always connected, cross channel marketing campaigns with full visibility, and many others. Knowing which trends to follow, which technologies to adopt, and when to do so is a challenge that we all face. There are many opportunities in front of us to make our offerings more relevant to our customers’ business models, thereby widening and deepening their opportunities for success. As such, we must offer a value proposition to our customers that provide “game changers” for their businesses. As an example, in 2012, Bell and Howell started rolling out some of the most interesting and innovative solutions the market has seen in years. We introduced new offerings that not only satisfy our customers’ needs for messages with higher impact and full traceability at a lower cost, but next-generation leaps that are poised to forever change how companies communicate with their customers. We took the best of everything we know about the mailing business and the latest advances that technology had to offer, and we created some of the most intelligent, automated systems ever used in our industry: the widest spectrum of applications at the lowest cost of ownership. As a result, a new benchmark has been defined in communications management. We work alongside companies to build environments that deliver high impact information, delivered to the communication

platforms of choice, when and where their customers want to receive their information. In doing so, we often end up tackling those challenges that other companies are not interested in or are not equipped to handle: challenges that standard products are not designed for, or where unique system or business needs are only met by dynamically changing information and data flow, or using automation and system intelligence to replace what once was done manually. Most important, we believe in true customer “partnering,” namely, sharing the risk with companies as well as the rewards – and using creativity, ingenuity, and a sense of urgency in our commitment to meeting and addressing their unique needs. To meet their challenges, customers are in search of a differentiator. A long-term solution that will separate them from another communication provider and help them grow their business. As a result, we help companies define, implement, and measure the benefits of these business differentiators, and with a “Customer-First” approach, we are measured by and stand by those deliverables. This is an approach that has been very successful for us and fosters a teaming with our customers to help them extend their existing environments and investments and achieve business and technical goals without completely rebuilding and restarting. Bell and Howell and our industry are seeing the mailing market space transform from being internally driven to being consumerdriven, and the providers who succeed in helping customers leverage the best that consumers’ information platforms have to offer are those who will embrace and lead the change. That is why we have restructured and realigned our culture and our organization to bring our smartest and brightest folks to the front lines to work even closer with our customers. Consequently, a “Customer-First” approach, with new technologies, expertise, and best practices, will all play a role in the upcoming year, and we want to help every business, large or small, realize what they can do to define their new benchmark for success.

leslie F. stern Chief executive officer Bell and Howell www.bellhowell.net


Envelopes Are About Privacy and Value

21st Century Mail: Anywhere, Anytime.

When Western States Envelope Company was founded in 1908, the main channels of communication were mail and newspapers. We built our business through the graphic arts trade converting envelopes from printed sheets. Over the years, we added stock items and custom capabilities. Now, after 104 years, through two World Wars, the Great Depression, and countless recessions, we have evolved into one of the premier envelope and label manufacturers in the country with five locations. We are still owned by the founding family, and our kinship with the printing and mailing industry still guides us today. We appreciate our history, but are more excited about our future. We see mail as a key element of communication today, but with more brothers, sisters, and cousins in the digital media mix. The envelope is still the preferred delivery vehicle for mail. A recent Nielson study conducted in Germany and the United States shows that mail received in a printed envelope creates more engagement and response than any other vehicle.

Looking Back:

Click2Mail was founded in 2003 with a single mission: to create technology that made sending high-quality mail simple and easy. We looked to the future of mail then and sought to leverage e-commerce technology to give small-volume mailers affordable access to value-adding mailing techniques such as inline address standardization, commingled presorting discounts and geo-routed, on-demand print distribution. We created a web-based, end-to-end mailing service completely online and called it Mailing Online. Today, Click2Mail continues to look to the future and leverages technology to manage the outsourced printing and mailing of millions of mailpieces for business mailers in the US and around the world — it’s now called hybrid mail.

Looking Forward:

The study showed that young recipients (16-34 years) prefer to receive advertising mail in a real envelope, if it is personally addressed to them. An incredible 84.5% of contents received in a printed envelope were read by recipients — the highest in the study. The graph above shows the tendency of people to recommend a product or service based on its carrier. The envelope provides privacy and the perception of value that does not resonate the same way with other mailing vehicles. As we look into the future, we see the envelope maintaining its perch in the hierarchy of mailing options. Our company, and the industry as a whole, is moving faster to make targeted in-home dates. The speed and demands of today’s inserting equipment require envelopes to be made better than ever before. The digital age is here, and the envelope will play an important part in delivering the message.

The use of hardcopy mail is evolving, and it’s clear that a continuing decline in volumes is inevitable. However, physical mail has some innate benefits and attributes that make it a preferred communications channel for many people who simply prefer mail, so it’s unlikely that mail will disappear any time soon. At Click2Mail, we definitely prefer mail and believe that current and emerging technologies provide opportunities to enhance traditional mail in ways that will preserve its utility and increase its relevance to modern communications. Clearly, to compete with electronic alternatives in the future, mail’s cost-benefit ratio must continue to improve, meaning senders of mail must continually and aggressively remove costs. Hybrid mail systems such as Click2Mail’s do this, reducing the costs of mail for both end users and the postal service. Also, email and other electronic media have changed people’s expectations about and the timing and immediacy necessary for modern communications. Mail should not take weeks to get posted. Mailers need methods for creating and posting mail instantly and they need to be able to be able to monitor the status of mailpieces in real time. Finally, mail creation tools need to be as accessible as email and other media. Mail needs to be available and accessible online, on PCs, on mobile devices, and integrated into modern office software systems. Mailers need a new generation of technology-based tools and services for creating, managing, and sending 21st century mail, and at Click2Mail, we believe that hybrid mail technology is part of the answer.

Steve Brocker Vice President of Sales and Marketing Western States Envelope & Label www.wsel.com

Lee Garvey Founder and CEO Click2Mail www.click2mail.com


FUtUrE OF MAiL ViEwPOiNtS

Who’s Driving? Customers Are at the Wheel In order to look forward in the industry, you really need to think about the definition of mail. Twenty-five years ago, mail was a communication delivered physically. Today, the delivery method is becoming agnostic. Whether received in the mailbox, on a laptop, or on a phone, it is still mail. Boxes, envelopes, and emails are all mail. So, what now? Actually, the future of our industry is not that difficult to figure out if you take time to connect a few dots. My forecast is based on three sources of information: the knowledge gained from past experience, information and reports we are getting from market studies, and, most importantly, the specific details that come from our customers.

A Rich History

Neopost enjoys a rich business background. During our history, this company has delivered a trove of innovative mailing solutions and has grown by making strategic and carefully planned acquisitions. History, however, only tells us where we’ve been. Our focus must be modernized and the sooner it changes, the better.

In the Driver’s Seat

Customer needs will drive the future of mail. And it’s not only our customers at the wheel. Our customers’ customers will steer our industry’s future. Many of our customers are planning or are implementing a digitization strategy. These are companies which, for years, used our solutions to accomplish a single task: process mail. If you ask end-users what they want to achieve, most of them will say that they need to reduce their mailing costs. They believe moving to a digital environment will be much more efficient and less expensive.

Costs and Responsibilities

This might be true in some instances. However, investigate a little bit further and one will learn about the additional costs that can be incurred when going digital. How much will it cost to accommodate an end-user whose customers don’t want to receive electronically generated mail? There will certainly be an administrative cost if your customers’ customers delay payment or forget to pay their invoices because they were sent

electronically. What is the price of managing all of the contact information you have on a customer? Data quality is already a huge challenge. Now add another set of essential information that must be clean to efficiently connect with your customers. And that’s just a few of the surface-level issues mailers must consider in the future mail world.

The Biggest Question of All

Solutions and potential revenue sources can be found in the answers to two simple questions: 1) How do people want to receive their correspondence, information, and commercial communications? and 2) How do people best respond to communications? The answers to these questions will reveal a useful truth that you can take to the bank. The future of mail is about customer preference, not its physical or digital form. The essences of all communication are sending and receiving information. Mailers who limit their future strategy to one side of the equation — sending — are in trouble right from the start. Recipients must be offered the options that best fit their preferences and reactions. Our customers must understand the importance of the receiving piece of the communication equation and accommodate it.

How to Succeed in Mail

At Neopost, we spend a lot of time talking to customers. Those conversations reveal three things. 1) The future of the mail industry will distill down to preparation, data cleansing, and multiple distribution options. 2) The act of sending will cede primacy. That presumes that the mail industry will embrace digital options. It clearly has and will continue to do so, based on customers’ desires. That’s not the hard part. 3) Success will require those of us in this industry to understand and accommodate our customers’ needs and the needs of our customers’ customers. And, we have to be willing to change. Everyone in this industry knows that the business, administration, perception, and use of mail are changing but not everyone of our customers knows that mail is alive and well. It’s up to those of us who work in this industry to make sure mail maintains its position as a vitally important part of American commerce.

Dennis P. LeStrange President and Chief Executive Officer Neopost USA www.neopostinc.com


FUTURE OF MAIL VIEWPOINTS

The Cloudy Future First-Class Mail is dying! Like it or not, the industry upon which we all depend for our living is, at the very least, mortally wounded. The first wound was provided by Fred Smith when he wrote his college paper proposing the formation of Federal Express. The second shot came from the Internet. A study done by Boston Consulting Group for the USPS forecasts that by 2020, First-Class Mail pieces will be 50 billion, down from the current 84 billion. In order to save First-Class Mail, a complete revolution must take place, but there are few signs that such a thing is happening. Instead, both the industry and the USPS continue to cling to the idea that a miracle is coming and that minor improvements will somehow save an outdated process. Standard Mail will likely survive; perhaps even grow a little bit because it produces results. No other means of direct advertising, including the internet, produces results as good. The risk in Standard Mail is that it has been subsidized by First-Class Mail. With a $10-15 billion decline in First-Class revenues, will the cost of Standard Mail need to be increased to a level where its economics are threatened? In the First-Class Mail world, the first thing to shrink is statement processing and bill paying. If one were to give it serious thought, there is no reason whatsoever for a paper statement. There are still many people hanging on to the old ways, but ask yourself if you know a 19-year-old who does anything other than on a portable electronic device. Given the above, one must ask, “What are the appropriate strategies in which our businesses must engage to survive this change?” Most participants in the mail marketplace are working hard to transition to electronic delivery, realizing it to be the likely next step. That is half true. Statements will be delivered electronically, but those successful at the transition will present an electronic experience, not just a copy of the paper bill. Unfortunately, few are taking this approach. For Gunther, we have largely removed ourselves from the statement marketplace, functioning primarily as a reseller in that market. We have chosen to specialize in those portions of the marketplace that are not easily transitioned to electronic delivery: making booklets on the inserter, very large documents, flat and folded into the same envelope, etc. So far, this appears to be a very viable strategy.

Marc Perkins President and CEO Gunther International, Ltd. www.guntherintl.com

Seize the Future of Mail and Billions in Savings Crawford Technologies launched our first digital document delivery solutions for the transactional print and mail industry in 1996. Since then, we have helped some of the largest companies around the world improve communications with their customers. As we consider the future of mail, we see something very specific — something that will revolutionize the industry and the customer experience. Digital document delivery solutions aren’t new, but in the past, consumers have had to sign up for many sites and remember multiple logins and passwords to get their mail digitally. The experience has left people unimpressed and has reached a 15% plateau in print suppression rates. Digital Mailbox Services (DMS) are revolutionizing the mailing industry with their friendly consumer experience and potential for billions of dollars in savings for transactional document mailers. A recent study by InfoTrends estimates that DMS will deliver “2 billion paperless transactional documents to U.S. consumers in 2015.” That number represents about 19% of all paperless delivery provided to consumers in the US. It also represents seven percent of all transactional documents and potentially over a billion dollars in savings for mailers. With the overwhelming acceptance of smartphones, tablets, and cloud storage, many analysts think these estimates are very conservative. For the consumer, a DMS represents a single signup and single sign-in for viewing their mail securely in one place, paying their bills and having their mail organized and stored digitally for their lifetime. The three current DMS services in the US (Manilla, doxo, and Zumbox) also provide smartphone and tablet applications. This consolidation to a single point of control is set to drive significant adoption of DMS. At CrawfordTech, we are helping mailers take advantage of this trend with PRO Channel Manager, a software solution that integrates Digital Mailbox Services into your operations by managing customer document delivery and paperless preferences for all DMS services from a single point of control. This means you can implement a DMS solution faster while maximizing your savings and serving your customers better. Extend your online marketing efforts and reduce mailing costs starting today. Seize the future! To learn more, view our recent Digital Mailbox Services webinar at http://bit.ly/JfCJ2t or visit our PRO Channel Manager information page at www. crawfordtech.com/mst. Ernie Crawford President Crawford Technologies Inc. www.crawfordtech.com


Mailing Systems Technology May-June 2012  

Mailing Systems Technology May-June 2012

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