Key USPS developments in 2021 and its plans for 2022 and beyond are presenting new challenges and opportunities for companies, especially high-value mailers. Regardless of the changes, companies that mail remain dependent on the Postal Service. Navigating its complexities just got a little more complicated.
Success is dependent upon having accurate, real-time postal data. But that’s not always easy when rules, service standards, and network changes are in a continuous state of flux.
Here’s a brief rundown of four very specific new realities that mailers need to know about and how to adjust their 2022 strategic plans as needed to ensure a more successful year.
Change in Rates
Companies are now in a continuous cycle of price changes. If you include both mail and parcels, you can plan to adjust prices five times a year.
Rate increases will begin to have an impact on some mail rates right as we start the year. A second increase of 6.6 to 8.5%, or possibly higher, is expected in July, which will have an even broader effect. By 2023, mailers can expect twice-a-year increases for the next few years.
The reality is that the average increase doesn’t match the reality for a lot of mailers because as the Postal Service changes rates, it always considers how to optimize its revenue. So, larger high-volume mailers will tend to see higher increases because that’s where the volume is and that’s where the Postal Service looks to maximize its revenue.
Given how essential mail is to conducting business, the best way to manage this new reality is to take a good look at your current address quality practices and optimize your campaign schedules and segmentation. Eliminating mail sent to the wrong address is a smart step in reducing waste. Working with the right data is a dependable way to make a positive impact on your bottom line.
Change in Leadership
The USPS, now under new leadership, is undergoing significant operational changes to improve efficiency. This will cause disruptions in the network for the next 2-3 years. It is critical to monitor and adjust accordingly starting now.
Add to that, the USPS has seen a massive turnover. Some reports put the most recent turnover as high as 50%, which went along with a major Reduction in Force initiative.
With the departure of so many staff, including seasoned employees, they lost valuable experience, valuable skills, even valuable data.
Mailers will want to monitor and adjust as changes are introduced and be sure to align with a partner or mail service provider that understands how to best navigate changes in postal practices and requirements as they occur.
Change in Delivery Time
Lengthier delivery times are the new normal. Last October, the Postal Service announced an increase in time-in-transit standards by one or two days for certain First-Class mail, mainly mail traveling longer distances.
With that change, most First-Class mail went from taking one to three days to three to five days for delivery. Though, very little volume had been meeting the one-to-three-day standard, and data now shows mail taking as many as six to eight days, or even longer, depending on where you are, the route your mail needs to take, and exactly where it’s going.
This new extended timing requires that you to reevaluate your expectations and adjust your scheduling plans for all mail campaigns. For those in a regulated industry, compliance rules and requirements all need to be factored in, all of which will further affect your campaign plans and timing.
If you’re lacking data that can help maintain a positive customer experience, now is the time to fix it. Invaluable delivery performance data, like real-time status of a mail piece’s location and projected in-home delivery dates, helps improve your decision-making when it comes to executing effective mail campaigns and keeping customers happy.
Change in Wasted Mail Volume
More than 6.8 billion pieces of mail were considered undeliverable by the USPS in 2020 alone.. That’s over 4.5% of all annual outbound volume. And industry analysts believe that number to be higher due to additional influences not captured by the USPS.
Your mail may not be delivered for any one of several reasons: an incomplete or incorrect address; a person who moved without completing a Change-of-Address form; weather delays, or other unanticipated events.
Certainly, in the last two years, the pandemic has taken its toll. The Postal Service reports nearly 36 million people requested address changes in 2020. 15.9 million people moved with a 6-month period including a 27% increase in temporary movers over the previous year. With a population in motion, having and maintaining a correct address has never been a greater challenge.
Undeliverable mail is inevitable; but it can be reduced.
High-value mail like credit cards, reimbursement checks, and insurance policies can be especially problematic because not receiving any of these can immediately impact customer satisfaction. For the mailer, deliveries that are late, lost, or sent to the wrong address can translate to lost revenue, fraud incidents, delayed receivables, and in some cases, regulatory penalties.
You can minimize these issues. Real-time data can be accessed to track and monitor your mail—from the moment it’s sent out to the moment it arrives. Companies are now using systems to translate data and integrate into their existing systems to help resolve delivery issues, better manage customers’ expectations, and reduce the amount of undeliverable mail.
Dean DeCencio, GrayHair’s Vice President, Business Development, works closely with many of the largest US companies advising on how postal data can translate to meaningful insights that can help resolve their business issues and improve processes across the organization. With a passion and advocacy for the mail industry and almost 30 years’ experience in supporting the needs of large enterprise mailers, he leads account teams to manage the short- and long-term needs of his clients. To reach Dean, email him at firstname.lastname@example.org or connect with him on LinkedIn.
For a deeper dive into what to expect for 2022, listen to GrayHair’s 2021 Year in Review / 2022 Year Ahead webinar with Angelo Anagnostopoulo and his colleague, Director of Address Intelligence Adam Collinson.