Last week, the National Postal Forum met in Indianapolis, Indiana, for another year packed with education, networking, and a chance to explore all the products and technologies for making mail faster, more efficient, and perhaps most importantly: more profitable.
The four days of the event were all jam-packed, and it was difficult at times to choose what to attend, given the high quality and relevance of all of the panels and sessions. That said, I wanted to share the top five takeaways I left Indianapolis thinking about.
1. The rate increase. There is no way to get around it or ignore it — perhaps the single biggest topic of conversation at this years’ event was the postal rate increases we are in the middle of, as part of the Delivering for America plan Postmaster General Louis DeJoy implemented upon taking up the role. The 10-year plan looks to get the USPS out of the hole it had been forced into over the past 15 years, but while most agree with the vision, they are struggling with the execution.
Common comments throughout the networking sessions and walking the show floor centered around the squeeze the increases are putting on margins, and how the pace of the increases — coming twice a year — are making it difficult to do business, given many contracts are annual. There was a curious mix of both optimism for the future of the Postal Service and frustration with how it is being executed. We’ve still got a number of years left on the plan, with no signs of it slowing down any time soon, so printers and mailers are looking for ways to work within the system and still have enough margins to continue to keep mail profitable.
The new design for the USPS delivery trucks was on full display at NPF 2024.
2. Mail is becoming a luxury item. On the heels of the rate changes, many are noting that brands are beginning to see the mail component of their marketing campaigns as more of a luxury line item than a commodity — which is both good and bad. They are mailing significantly less in some cases, but they are also willing to pay more per piece for higher-end substrates, finishes, and other touches that can help their mail piece stand out.
3. Design is critical. While certainly not a new phenomenon, the design of the mail piece is only becoming more critical. One great session by Leanne Herman, the director of Postal Affairs for Spire, focused on how even the way a piece is folded can mean the difference of thousands — even hundreds of thousands in some cases — of dollars in postal costs. Understanding the intricate requirements for postal classifications, postal discounts, and mail piece design will help set a printer or mailer apart, becoming a trusted partner for brands looking to optimize their spend when it comes to what they’re putting into the mail stream.
Herman did note that postage is the single biggest expense of a mail campaign today, so printers and mailers shouldn’t hesitate to call out the USPS if they attempt to claim a piece isn’t compliant for the rates you expect. “If a local post office tries to reject [a piece],” she said, “tell them you need the exact violation in writing.” From there, there is a robust appeals system you can follow to prove your piece is compliant. A word of caution however, she shared. If the mail piece can’t wait for an appeal to go through, you have two choices: reprint the job and mail it again or pay the disputed rate and mail anyway. If you win an appeal, the USPS will refund the rate difference — they will NOT refund the cost to reprint the job. So, if you are confident you are in the right, don’t be afraid to take the temporary hit to the margins.
4. Postal discounts are more critical than ever before. Speaking of postal discounts, there are a lot of programs out there that brands and mailers could — and should — be taking advantage of, and those discounts are shifting and changing. For example, the discount for using the Informed Delivery will no longer be a standalone discount, but will be an additional discount under other categories. There are also discount programs that you must sign up for now to be able to take advantage of them this fall. This is another area where printers and mailers can be the valued partner to their brands and customers — make sure someone on your staff is the postal expert who knows the ins and outs of every mail classification and discount program to help clients get the most bang for every buck they spend. The biggest reason for missing out on a postal discount is the design of the piece, so helping brands make small changes can mean huge savings.
5. Direct mail works. Direct mail is still the single marketing channel that gets the most return on investment of every platform — multiple sessions noted that ROI for direct mail sits at around 40%, which is significantly higher than any other channel. Bob Rosser, the director of Postal Affairs at IWCO, noted that even further, 84% of consumers say they are more likely to open a personalized piece of direct mail, 50% of Americans say they prefer getting direct mail over email, and 25% of Americans say direct mail is a more trustworthy source of information than other channels.
Even better, SG360’s Melanie DeCaprio, vice president of marketing; and Michael McCormick, marketing specialist, had additional good news about the mail channel. The company's "Future of Direct Mail 2024" report found that 81% of marketers actually plan to increase their direct mail budget in the next 12 months, despite the rate and cost increases. The reason? 88% say they see conversion rates at least 5% higher than their next closest marketing channel, demonstrating how powerful mail still is.
Some additional heartening statistics they shared include that 69% of all consumers engage with at least 25% of their direct mail pieces every week in some way, which includes visiting a company website, saving the mailer for future use, doing online research, sharing with friends and family, or even making a purchase.
Finally, DeCaprio and McCormick noted that many marketers are starting to move to a more programmatic approach to their direct mail pieces, and are seeing engagement numbers increase by as much as 45% after making the shift. It speaks to the need for printers and mailers to have the technologies in place to help design and execute mail campaigns that can be generated, produced, and mailed on the fly as needed. Inkjet technologies have made it possible to do these kinds of highly personalized small runs, so if you haven’t explored digital printing technologies for your mailing business, you are already behind.
Of course, this is only a small sample of what I learned at the National Postal Forum this year. It was a truly great event, and I come away with a lot of new friends, new ideas, and excitement about the future of mail. Even as we overcome the challenges of the changing mail landscape, mail still has a bright and vibrant future ahead of it.
