No Cents

  |  May 3, 2007   |  Comments

Postal rates are going up...again. Is it finally time to force customers into the digital channel?

Back when I headed up one of the larger e-mail service providers, we'd literally celebrate postal rate increases. Our thought was with the passing of each postal increase, coupled with the ongoing shift of consumer media patterns and rising printing and paper costs; the marketing community would surely move more decisively to building an online and e-mail communications strategy.

I no longer sit in that chair, but I greeted the news of another postal increase with a high degree of puzzlement.

Mark your calendars. The U.S. Postal Service (USPS) will once again raise first-class rates to a whopping $0.41 on May 14. Seems the Board of Governors met six times since May 3, 2006, to ponder rate increases for first-class and other classes of mail. One of the brighter ideas to come from all these meetings was the introduction of the Forever stamp. Break open all those piggy banks and head down to your post office to purchase as many of those Forever Stamps as you think you'll need. The stamp may be forever, but the offer's only available for 75 days, starting May 14.

Seems the USPS understands these increases will exact some level of distress on consumers, so they offered a series of helpful hints. Mailers are encouraged to think before they mail. If the contents of a large first-class envelope are folded and placed in a letter-sized envelope, mailers can save as much as $0.39 per piece. The Governors are also worried there may be rate shock among small business and catalog mailers, whose rates will go up an incredible 40 percent.

Has the world gone mad? In a market experiencing the level of volatility, change, and competitiveness as advertising and marketing communications, would any of us recommend increasing prices? Has the USPS spent any time looking at the staggering amount of communication conducted via e-mail? Increasingly more people are opting for online communications with brands they know and trust. The trend line doesn't show any glimmer that with the passing generations consumer behavior will revert back to ink on paper as a primary communications delivery mechanism.

How can those of you who manage P&Ls or live within departments under greater bottom line scrutiny sit back and take each postal increase? Forget the Forever Stamp. You should spend every waking hour plotting how to leverage each and every way you can migrate from a costly channel to the medium of choice for this generation and the ones that follow. Postal increases should continue to be red flags indicating you haven't done enough to move all customer touch points you have to e-mail.

I can hear some of you dinosaurs out there kicking back with the old "not everyone is on the Internet" excuse. Some people like going through thousands of catalogs.

Yep. As someone who lost his transit pass several weeks ago, I can tell you that folks who actually like waiting in line to pay tolls are misguided souls. It's time to force marginal customers to get on the boat or be left behind. Spending time, resources, and costs serving a marginal audience that hasn't embraced the Internet impacts the bottom line. Now, the postal service is taking another 7.6 percent cut of the unit costs you have per customer. Where's the outrage?

E-mail is no longer a "nice to have" part of a strategy. It's a mission critical part of business life. All those folks you have working on building a more robust Web site? Get the best brains into crafting more meaningful interactive dialogues via e-mail. Now. It's harder work to craft these dialogues than blasting away in direct or e-mail, but it's essential to your business livelihood.

The USPS proposed a single container charge for periodicals but also recommended 55 different prices based on container type, entry point, and level of sortation.

All you fellow publishers and catalogers: what are you waiting for before you migrate your print catalogs into a digital format? Are you waiting for consumer research to provide a blinking neon sign when customers are ready? Won't happen.

If you're smart, you'll force customers to embrace digital publications and catalogs. The technology is incredible in its ability to provide consumers a richer shopping experience, including contextual drill-downs and embedded video.

It may be blasphemous for some to hear the words "force" and "customer" in the same sentence. But you're fighting to build a profitable business in years to come. If you wait for someone else to get this job done, you'll be out of business.

For those of you needing another wakeup call, May 14 should do the trick. Time to have the folks in accounting figure out exactly how much more it's going to cost to maintain the status quo. Time to convene senior leadership meetings and elect an individual with the responsibility of crafting a more cost-effective and efficient customer communications strategy within the entire company at each touch point: marketing, customer service, and supply chain.

Failure to get your act in gear makes no cents at all.

Al D.

Join us for the ClickZ Specifics: E-mail Marketing seminar on May 14 at the Marriott, San Francisco.

Want more e-mail marketing information? ClickZ E-Mail Reference is an archive of all our e-mail columns, organized by topic.

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Al DiGuido

Long recognized as one of the direct response industry's premier innovators and a pioneer in e-mail communications, Al DiGuido brings over 20 years of marketing, sales, management, and operations expertise to his role as CEO of full-service digital marketing company Zeta Interactive. Formerly Epsilon Interactive's CEO, DiGuido also served as CEO of Bigfoot Interactive, CEO of Expression Engines, EVP at Ziff Davis, and publisher of Computer Shopper, where he launched, a groundbreaking direct-to-consumer e-commerce engine. Prior to Ziff Davis, he was VP/advertising director for Sports Inc. DiGuido also serves on the Direct Marketing Association's Ethics Policy Committee.

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