As reported in the last issue of the Direct Mail Journal, The USPS increased the cost of postage in August based on approval from the Postal Regulatory Commission (PRC). Postage increases are usually announced in November and take effect in January. This is the second price increase this year.
One source of positive news is that the First Class rate for postcard postage has been extended to jumbo postcard sizes. This is great news for all organizations that use postcards for marketing, notifications, or seasonal greetings.
Domestic Mail Postage
Here is a little context for those who may not be as familiar with the structure of postal rates. There are many different postal rates and a dizzying array of rules. The Domestic Mail Manual (DMM), the USPS bible for all things postage, contains hundreds of pages, each with detailed specifications on mail formats, processes, and charges. This is an extremely technical topic area that overwhelms even postal employees. Thankfully, all but the largest mailers, can focus on just a few key elements of the DMM.
There are two basic classes of postage: First Class and Standard A – the USPS is in the process of re-branding the latter to Marketing Mail. There are also special services such as certified mail, and different classes of service for parcels, but we will focus on letter (and postcard) prices in this article.
First Class postage is what most people think of when the discussion shifts to postage. If you visit a post office to send a card or letter, the Forever Stamp that you receive at the retail counter, represents First Class postage. This covers the cost of sending a mail piece of up to 1 ounce anywhere in the United States. There are additional charges for additional weight up to the maximum of 3.5 ounces. Just for reference, a 1 ounce letter is ~4 sheets of paper in a standard #10 envelope.
Standard A (Marketing Mail) is what most consumers used to refer to as bulk mail or even junk mail in some circles. Standard A is used by mass mailers to send marketing materials, in volume, at significantly reduced rates. Postage often represents over 70% of the cost of sending mail, so mass mailers are hyper-sensitive to the cost of postage. A change of $.01/piece in postage, when sending millions of pieces, can be significant.
Direct Mail Features and Discounts
The core features of the different service levels are easy to outline. We usually expect First Class mail to take ~3 days for delivery anywhere in the US – often faster for local mail. The USPS also provides a return service, so if the piece cannot be delivered, it is returned to the sender. On the other hand, with Standard A, delivery can times typically run 7 – 10 days, and there is no return service. If the USPS cannot deliver it, they will automatically recycle the mail piece for the sender.
There is one other source of savings that commercial mailers, and Zairmail customers, can access called pre-sort discounts. Pre-sort is a form of postal discount based on the concept of work-sharing. The commercial mailer (or service provider) processes the mail in advance, corrects the list for recipients who have moved or addresses that are undeliverable, assures that all mail pieces are machinable and have a bar code, and then places the mail in trays in carrier route delivery sequence.
The higher the delivery density in specific carrier routes, the greater the level of discount. This saves the USPS time and money, and these savings are shared with the mailer based on pre-determined pre-sort rates. Because the mail is pre-processed, and bar codes are added, delivery times tend to improve. The mail can also be tracked based on USPS barcode scans.
Pre-sort discounts are only available for jobs that are greater than 500 pieces for First Class Mail or 200 pieces for Standard A. Zairmail automatically pre-sorts all mail that qualifies and passes along the savings to our customers.
Direct Mail Postcards
The one other happy wrinkle in postal pricing is that the USPS offers a discount First Class Postage rate for standard postcards (4” x 6” or 4.25” x 5.5”). This represents a great value for those who use postcards. The discount postage is very close to what clients would pay for Standard A, but they get First Class postage performance. To illustrate, the current price (after increase) of a First Class stamp is $.58, the cost of a First Class postcard is only $.40 (retail). In the past, if the size of the postcard increased beyond the standard postcard size, then the postage would go up to standard First Class postage rates.
Jumbo postcards are very popular with many Zairmail clients. The larger message area (6” x 9” or 5.5” x 8.5”) provides additional freedom to deliver a compelling offer and include vibrant graphics that really pop in the mail. One common benefit provided by a postcard is that we don’t have to worry about it getting opened – each postcard is like a mini-billboard in the mail. Still, we still need to make sure that it stands out and gets seen – bonus points if it earns spot on the recipient’s fridge!
That is where the larger size comes into play.
Zairmail clients can now order both standard postcards or jumbo postcards and the pricing reflects the discount postcard rates (with pre-sort greater than 500 pieces).
Here is a comparison of the new pricing based on these changes.
If you are using small postcards today, and you have toyed with the idea of using the larger format of jumbo postcards to increase your impact; this is the perfect time to give it a try – there is very little difference in price. If you are already using jumbo postcards to spread your word, then enjoy an early holiday treat from Zairmail and the USPS.
Let’s save some money (and grow your business) for the holidays and beyond!
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Zairmail (www.zairmail.com) is the fastest and easiest way to send (real) postal mail. Give us a call anytime at 888.898.0066, we would be happy to help with your direct mail needs.