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Dec. 5 2011 06:57 PM

The USPS is scrambling to find a way to increase mail volumes and revenue. With deficits projected as far out as bean counters can calculate, everyone agrees the Postal Services has to cut costs and increase revenue. The marketing department is in charge of increasing revenue. To do this it has implemented two new programs, EDDM and The Direct Mail Hub. EDDM is an attempt to increase revenues by increasing mail volumes. The Hub is not designed, nor intended to increase mail volumes. It is designed to generate royalty revenues from a few selected partners providing products and services to end user customers. This alliance between the USPS and its Hub partners is a direct threat to everyone in the direct mail industry!

USPS Request for Information--looking for those Select Partners
A recent Postal RFI states, "The U.S. Postal Service (USPS) is conducting market research to review potential partner capability around order fulfillment, database marketing services, consumer segmentation and campaign analytics, website design and marketing."❠Add these services to the web-to-print offering already on the Hub and no service provider will escape the negative impact of future postal sales initiatives.

To someone who watched the USPS bid out zip+4 data processing services in the early 90's and then give away those services (free) to end user customers, this RFI is a sad reminder of how quickly the Postal Service can destroy the monetary value of a product or service you provide. The Direct Mail Hub (so far) is only providing web-to-print direct mail services, along with a complicated bid platform for people looking to find the cheapest service provider rather than companies that deliver value. But the Hub was designed to add a full range of additional services. It is obvious that the Postal Service plans to add "order fulfillment, database marketing services, consumer segmentation and campaign analytics, website design and marketing."❠When they do they will be working with only one service provider per industry segment and through that service provider, bureaucrats at the USPS will control that segment of our industry.

Don't look into your crystal ball and hope the USPS would never do such a thing, look to the past where their arrogant ignorance took a new profitable value added service, zip+4 assignment, and turned it into a value add that MSPs were forced to provide for free. The USPS is eliminating Confirm fees (and therefore revenue) in January; next up for the Direct Mail Hub is providing the analytics for tracking mail, at below market rates. Of course the rubric for all things postal is to increase mail volume. The real goal of the USPS marketing department is to give postal bureaucrats control of our markets and increase revenue (not mail volume) by competing with the industry they are supposed to serve.

In the Postal RFI "Direct Mail Technology Integration"❠(11/08/11) under "Partnership Considerations"❠it states "the Postal Service is exploring different relationship structures involving third parties, including white labeling a service/product offering." Is anyone looking forward to competing with the USPS brand and marketing budget? The Partner Considerations section goes on to say "The USPS will provide a trusted brand name, trusted delivery, a marketing channel (including cost effective direct mail and and sales lead generation while leveraging the core capabilities of potential alliance partners, affiliates and/or suppliers."â
And why would the USPS provide all of these services, including its brand name? Of course, the all-important "revenue share arraignments"â! The Postal Service has come a long way from not endorsing any one company, product or service to picking winners and losers based on the size of the revenue stream a "partner"❠is willing to generate for the USPS. What is the value of providing the only USPS branded postage meter, presort service, or software package?

Only a government agency, led by entrenched life time bureaucrats, would implement a marketing policy designed to stifle competition and compete with their most loyal customers through "white labeling"❠schemes. The geniuses in Washington have come to the irrational conclusion that it is better to utilize 1,000 postal sales people in support of a handful of partners selling USPS branded services, than to leverage the sales forces of 54,000 commercial printers and an untold number of other service/product suppliers in selling direct mail.

EDDM is hailed by the USPS as a great success. It is a success because it sells direct mail, not direct mail services. The Direct Mail Hub is a direct threat to anyone providing products or services to people that use direct mail. The above RFI states the USPS will provide lead generation to their "partners"â. And where will those leads come from? From the website and contacts postal sales people make. If recent history is repeated, many of those sales leads will be our customers with contact information gathered from required postal documentation we are forced to provide in order to do business with the USPS! That's right, still no firewall between your private customer information and a postal sales force incentivized to share that information with their new postal partners.

Your individual effort is needed!

The Postal Service is picking winners and losers. Our industry associations have been impotent in stopping them. We cannot boycott the USPS and use a different carrier, but we can make our displeasure known at every opportunity, in every venue, to every postal employee possible. We do not have to chair or be on their PCC committees. We do not need to lend our support, products or resources for them to get their messages out. We can provide as little information as possible in all interactions with postal employees.

I have been told by postal employees (confidentially) that the marketing department is off on a tangent and that they do not want to be associated with it. We need to be more aggressive in expressing our displeasure and continue to alienate this rogue postal marketing group even more. Unfortunately we must force the USPS marketing department back to promoting and selling direct mail and stop the development and selling of licensing agreements that will debase the brand. Increased mail volumes will benefit everyone; licensing fees will not save the Postal Service!

There is another group that needs to be alienated by the direct mail industry. These are the vendors that support the USPS in its campaign to sell direct mail products and services. We need to tell our suppliers that the Direct Mail Hub is a threat to our businesses and that we will not do business with anyone that becomes a strategic partner in this USPS marketing scheme. These "partners"❠of the Postal Service must be forced to choose between us and sharing revenues with the USPS.

The USPS is picking winners and losers in our industry. If the 99% of us designated as losers by the Postal Service pull our business from the "winners"â, we will have a significant, negative affect on their bottom line! Stopping the USPS from competing with us is the goal. To achieve our goal we must punish postal Hub partners.

It is time to BOYCOTT the Direct Mail Hub collaborators!
Todd Butler, Butler Mailing Services, eKEY® Technologies can be reached at 513-870-5060,