When using mail to communicate with your customers, the address is the keystone – the lynchpin that holds together the content, creativity, production and delivery of documents. Keep your system running smoothly by formatting, updating and maintaining addresses as soon as the organization acquires the information.
Companies may attain addresses individually or as part of a list. A prospect or customer may initiate contact through the mail, by telephone or on a website. Or the company may receive a group of addresses - by purchasing a list, or receiving a batch update from a customer (e.g., an insurance company receives a list of employees). In both cases, the addresses should be validated for completeness and accuracy as soon as possible.
The United States Postal Service (“USPS”) has established standards for the proper formatting of addresses (Publication 28 - Postal Addressing Standards). Following the proper standards improves the deliverability of the mail, reduces the amount of return mail and allows for participation in postage discount programs. Companies can use USPS-certified software that puts addresses into the proper format and validates the correct ZIP Code information. The certification is known as the Coding Accuracy Support System or “CASS”.
For individual addresses, a company may choose to validate addresses in real-time or in a batch mode. To check individual addresses automatically, the company’s software bounces the address against a CASS-certified engine using an application programming interface (“API”). Many people who order on the internet have encountered this type of update. They enter an address on an order form and on the next screen, the address is presented in the correct USPS format with the full ZIP+4 code displayed. The API software may interface with CASS software installed locally or via an internet subscription (SaaS).
Using “real-time” correction reduces the numbers of address errors in a database. Postal coding software often makes changes to an address, like the street directional or unit designation. If the information is being entered by a customer service representative, they can confirm the change with the person during the call. If the person is entering information on a website, they’ll be able to validate the coded address.
If the systems don’t allow for an API interface, or if the company is receiving lists of new customers, then batch jobs checking all new addresses should be scheduled nightly. Not only does this practice ensure conformity with postal regulations, it exposes any errors as soon as possible. It also allows the company to start correcting those errors before any mailpieces are sent out – and returned as undeliverable.
For any customer or prospect lists received, the batch job should also include running the list against the National Change of Address (“NCOALink”) database. Using NCOALink is one method of being compliant with Move Update - matching the mailer's address records with change-of-address (“COA”) orders received and maintained by the USPS. There are four approved and two alternative Move Update methods. Mailers can meet the Move Update requirement in the following five ways:
On Friday, June 5, 2015, the United States Court of Appeals for the District of Columbia Circuit (“the Court”) issued their decision on the Exigent Rate increase approved by the Postal Regulatory Commission (“PRC”) in December, 2013. The decision answered petitions by the United States Postal Service (“USPS”) and mailing industry groups against the PRC’s 2013 order. The USPS argued that the PRC’s exigent rate approval didn’t go far enough, while the mailers argued that the PRC went too far. The Court issued a spilt decision.
Background
In their December 24, 2013 ruling, the PRC found that the USPS experienced financial harm as a result of the Great Recession of 2008 – 2009, and was legally entitled to implement temporary price increases in excess of the CPI cap. The PRC denied the Postal Service’s request to make the increases permanent. It found allowing the increases to remain in effect indefinitely would be inconsistent with fundamental postal policies underlying the price cap.
The PRC determined that the USPS didn’t adequately break out losses due to electronic diversion from the losses due to the recession. The PRC analysis determined that the recession caused the loss of 25.3 billion pieces with a value of $2.8 billion. The exigent rate increase would stay in effect until the USPS recovers the $2.8 billion, with the additional requirement of reporting quarterly on revenues generated by the rate increase. The mailing industry expected the exigent rate increase to expire in late summer of 2015.
Appeals Case and Decision
In early 2014, the USPS and 20 mailing organizations petitioned the Court to review the PRC ruling. Although the petitioners were arguing for different decisions, the cases were consolidated, with oral arguments heard on September 29, 2014. All parties hoped for a ruling before the next rate case, but that was not to happen. The decision was issued 6 days after the new rates went into effect.
The arguments of the USPS centered on their calculations on the volumes lost due to the recession, and that the PRC “new normal” rule was arbitrary. The “new normal” concept means the economic disruption had ended, the rate of change on USPS volumes is positive, the USPS has the ability to predict or project volumes, and the USPS demonstrates the ability to adjust operations to the lower volumes. The Court ruled that the PRC was within its discretion in applying the “new normal” rule, and denied the USPS’s petition on that matter.
However, in determining the mail volumes lost, the PRC applied a “count once” rule. The example in the decision is a worker who was laid off has to cancel her cable and no longer pays that monthly bill. The PRC only counts that change as a difference of 12 pieces, limiting the loss to only the first year. The USPS argued that the change should be extended for as long as it takes the worker to get a new job.
The Court stated that the PRC could have used the “new normal” rule to better determine how long they should have counted lost mail. The “count once” rule was vacated and remanded the decision to the PRC “for proceedings consistent with this opinion.”
The Court denied the mailing organizations’ petition for review. With blunt language, the Court dismissed each of the arguments, including the claim that the PRC confused “correlation” and “causation” with their review of the data impacting the loss of mail volumes. The Court could “see no fatal error in the Commission’s analysis.”
Implications to Mailers
The Court’s decision supports the PRC’s approval of a temporary exigent rate case, while it dismisses the PRC’s calculations of the financial loss suffered by the USPS. This means that the exigent rates will expire, but the PRC will need to review their December 24, 2013 decision, and reassess the number of mail pieces lost and the financial impact of the lost postage.
The Court’s dismissal of the “count once” rule means that the PRC’s $2.8 billion loss estimate is too low. With the many economic variables that must be considered, it will probably be several weeks before the PRC issues a new decision. At this time, the PRC hasn’t indicated what steps they’ll take next. It’s likely that the PRC will extend the period of time the current exigent rate increase stays in effect, well past this coming August. That means mailers should plan on the current postage rates to stay in effect for the remainder of 2015.
Maybe some people don’t see the opportunities of using physical mail, but they weren’t among the approximate 3,500 attendees at the National Postal Forum (NPF) last week in Anaheim, California. Whether it was vendors in the exhibit hall or presentations in the classrooms, people were bullish about the benefits and the future of physical mail. And leading the charge was the Postmaster General (PMG), Megan Brennan.
For the last several years, the principal message from the leadership of the United States Postal Service (USPS) centered on the gloomy outlook for mail volumes, the fiscal crisis created by Congress and the need to reduce mail service to 5-days-a-week delivery. That was not the case this year. PMG Brennan and her team focused on the positive side of the narrative, emphasizing that physical mail is complementary to electronic communication.
On May 31, 2015, the new postage rates go into effect, and mailers need to take action to be properly prepared for the new rates. For most companies, the first day of mailing under the new rates will be Monday, June 1, 2015.
As soon as possible, send an announcement to your customers. If you manage a corporate mail center, that means the departments you service. The notice should include an explanation of the new rates, and how the rates will impact your customers’ costs. If your department or company can help mitigate the expenses through better presort or changing classes of mail, this is the time to highlight those opportunities.
Also provide a chart on the new retail rates, and explain how the rates will impact personal mailings, such as bills. By providing this type of information, you reinforce your image as the expert on postal affairs, and that you add value to the process.
Meet with local USPS representatives, including the acceptance unit. Review the changes with the new postal statements, including electronic submission. If possible, meet with the Business Mail Acceptance unit manager or supervisor. Ensure that everyone is on the same page with any changes.
Talk to postage meter and software vendors. Include your programmers on the call, to make sure they understand when and how the updates will be delivered, how to properly install the updates, and how to test the changes. Establish a phone tree for reporting and resolving any problems with the installation.
Schedule training for your employees about the new rates. Review the new rates and forms for every category of mail your shop produces. Go over the update schedule for the meters and software, discussing any potential impact to production. Lastly, cover the actions the department will take directly before and after the new rates go into effect.
Prepare to implement all the changes at the end of the day on either May 29 (Monday through Friday operations) or May 30 (Monday through Saturday operations). Download and install meter and software updates. Post reminders around your mail center about the new rates. This includes putting printed notices at the meters, the inserters and the customer service desk. For corporate mail centers, also post reminders at internal mail stops. Replace all internal and postage statement forms.
On Monday, June 1, send out another notice to your internal and external customers about the rate change. At the daily huddle with your employees, remind them about the changes and answer any last-minute questions. Inspect every meter to make sure the settings are correct, and review the testing the programmers completed on the software updates. Conduct additional quality control checks throughout the day.
If possible, have a manager or supervisor accompany the mail to the post office at the end of the day. Rate cases are a significant change for everyone involved, and there may be confusion. Have someone with your mail who is authorized to resolve any problems and answer any questions.
To assist mailers with these changes, The Berkshire Company has published a new e-book, “Preparing Your Mail Operation for the U.S. Postal Service 2015 Rate Increase”. This free resource, which includes an implementation checklist, is designed to help managers ensure a successful transition to the new postal rates.
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"There are three kinds of lies: lies, damned lies, and statistics." – attributed to Benjamin Disraeli
The U.S. Postal Service’s Office of the Inspector General (USPS OIG) recently released a report entitled, “Declines in Postal Service Mail Volume Vary Widely Across the U.S.”. It’s unclear how much expense and effort was spent producing the report – a report with a misleading title, flawed data analysis and an ineffectual conclusion.
The title suggests the OIG has studied all mail volumes. In fact, the study only focuses on one small category of mail – Single Piece First Class Mail (FCM). These are the individual pieces of stamped mail given to the USPS by individuals and small businesses. Most of that mail is business related – invoices to customers, notices, bill payments, applications, etc. A small portion are letters and personal correspondence.
What’s important to note is that Single Piece FCM represents only about 14% of all mail volumes (Source: USPS: A Decade of Facts and Figures). The remaining 86% of the mail is composed of transactional documents (bills and statements) from companies to their customers, advertising mail (Standard Mail), media mail, periodicals and parcels. The volumes for transactional documents and Standard Mail have been fairly level the last 3 years, or experienced small growth. Those are the areas that the USPS and the USPS OIG need to focus their efforts.
The data collection methodology for this report is flawed. The report is supposed to show changes in the use of mail by geographic area. As pointed out by the website postalnews.com, the report fails to take into account the USPS facilities that have been closed or expanded in the last several years. That means that mail that used to be processed in one area has now been moved to another. Because of this change where the USPS processes mail, the OIG analysis shows that the volumes in the area where I currently live has declined by 96%, and where I used to live the mail has increased by 128%! That would be shocking, if it was true.
In the report, the OIG added a footnote that states “These areas may have data issues or may have experienced significant changes to mail processing operations.” In reality, most of the country has experienced changes to mail processing operations as part of the USPS Network Optimization initiative. Once these data discrepancies were noticed, the researchers should have stopped and found a better method of measurement.
The stunning conclusion of this flawed study: “More research is likely needed to explain why these trends in mail use exist and how they are evolving.” That’s right, the research concludes what’s really needed is more research.
I couldn’t agree more. Except this time, the study should be conducted by someone who understands the true nature of mail, includes the larger categories of mail, and doesn’t use flawed data.
Focusing on Single Piece FCM is a distraction from the real issues facing the USPS. Business mailers produce the overwhelming majority of mail processed by the USPS. Most of that mail has the Full Service Intelligent Mail Barcode (IMb), which allows for piece-level tracking from point of entry to the delivery unit. That data, with proper analysis, would provide useful information for the USPS and their customers – businesses and individuals – as they deal with the issues of today, and plan for a successful future with mail.
“No one sends important documents through the mail anymore.”
“First Class Mail is disappearing.”
“'Snail Mail' is an anachronism is the ‘Age of the Internet’.”
We hear these phrases, or ones that are very similar, on almost every consulting engagement that involves inbound mail. Of course, these opinions are normally from people who don’t work with many physical documents (e.g., IT professionals) or people who are far removed from the daily workflow (e.g., executives). It then becomes part of our assignment to educate everyone on the importance and impact of physical mail on their business.
Of course, there are some truths in these statements. Many documents are sent via email or other electronic transfer methods. The volumes of First Class Mail arriving at businesses have declined. And any mail being delivered by a dawdling terrestrial mollusk probably isn’t that important.
However, the letters, flats and packages arriving at corporate mail centers each day are important. For many customers, the only communication they have with their vendors is through the mail. Companies must develop policies and strategies to service those customers. A sound strategy that includes:
Last week saw the release of two important reports regarding the United States Postal Service (“USPS”). The first was the annual Financial Analysis of United States Postal Service Financial Results and 10-K Statement by the Postal Regulatory Commission (“PRC”). This lengthy report is representative of an audit a public corporation would present to its stockholders. On page 2 (of 76), the PRC summarizes their findings stating:
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One of our clients recently received an interesting direct mail marketing piece from Cliff Rucker, the Vice President of Sales for the US Postal Service (USPS). The letter explained that the new dimensional weight (DIM) pricing policies of their competitors makes Priority Mail even more attractive for shipping. In the “P.S.” paragraph, the letter gave the name of the local USPS representative who would be contacting the recipient directly.
This sounds like a standard direct mail piece designed to raise awareness and provide an introduction for the sales representative. Just a few issues:
For many reasons, I was excited when the Smithsonian Institution and the US Postal Service (USPS) announced the creation of the National Postal Museum in 1990. I’d been a supporter of the Smithsonian for years, and loved their monthly magazine. My father had been a clerk for the USPS for 25 years. More importantly, he was an avid collector of First Day Issue stamps, going back to 1939. We were both happy to see this museum launched.
In 1993, the National Postal Museum opened their doors to the public. Fittingly, the museum is located in the historic City Post Office Building, which was the Washington, D.C. post office from 1914 through 1986. The museum’s exhibits celebrate philately (stamp collecting) and postal history. Over the last two decades, I’ve been able to visit several times, including as a guest for special USPS events.
But mail is more than just stamps and the US Postal Service. The letters and packages that are delivered each day represent the work of the mailing industry – an industry that supports over 8.4 million jobs and generates over $1.3 trillion in annual sales revenue. An industry with a story that needs to be told. The National Postal Museum agrees.
In the last year, the National Postal Museum has launched an initiative to tell the story of the mailing industry to the public through online and physical exhibits. The project will show how the USPS network helped to build the mailing industry and how the mailing industry adapts and changes to serve the American public’s business and personal communication needs through the Postal Service’s network
My good friend, Karen McCormick, is the liaison between the museum and the industry. This is good news, as Karen is someone who knows and understands our industry. In 1986, Karen founded a mailing company, Fulfillment Express, in Waltham, MA. For 28 years, Karen and her employees printed, stuffed, packed, labeled and metered millions of letters, brochures and packages for their clients. In 2014, Karen integrated her operations with The Field Companies Fulfillment Center Inc., also in Waltham.
Karen gave back to the industry by serving on association boards. She’s been the president of the New England Direct Marketing Association and the local chapter of the Mailing and Fulfillment Services Association. Since 2001, I’ve served on the Greater Boston Postal Customer Council Executive Board with Karen, including the 4 years she was our Industry Co-Chair. She’s the right person for the job.
Karen and the leadership of the National Postal Museum have been reaching out to different industry associations to garner their support for this project. So far, they’ve met with representatives from the Mailers’ Technical Advisory Committee, Volume Mailers Group, PostCom Board Parcel Shippers Association Board and the National Postal Policy Council. Over the next year, Karen will be contacting more associations to gather information and artifacts that represent the history of our industry. This May, they’ll also have a presence at the National Postal Forum in Anaheim, CA.
This is great development for our industry. Too often, mail is marginalized by businesses and society. This project will help tell the important story of how the US Postal Service and the mailing industry are essential parts of our national economy.
You can learn more about the National Postal Museum at their website, or tour the exhibits at 2 Massachusetts Ave., N.E., Washington, DC 20002.
