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USPS to reveal ideas on digital mail services this summer

Tuesday, May 31st, 2011

The US Postal Service is set to release its initial ideas on how it could develop digital or hybrid mail services this summer.

Paul Vogel, the USPS chief marketing officer, told the Mailers’ Technical Advisory Committee (MTAC) last week that his team had been wading through “thousands” of ideas that have been put to the Postal Service regarding possible strategies to move into new forms of electronic communications.

“There’s been no shortage of ideas of what the Postal Service should be doing,” he said. “We can’t implement them all – we’re trying to narrow down the field in terms of what we can implement without Congressional approval.”

But Vogel then added: “We will have at least a proposal within the next month or two.”

Electronic communications are something of a double-edged sword for postal operators around the world – cutting into physical mail volumes, but also offering potential income opportunities. With hybrid mail – the printing of electronic-sourced materials for physical mailing – there are also opportunities for electronic communications to help mail volumes.

US Postal Service executives believe e-substituion of physical mail could be to blame for as much as a 4% decline in mail volumes, but with private sector players developing digital postal mail platforms, the USPS has been pressured to get involved.

This year, reports from federal agencies including the Office of the Inspector General and Government Accountability Office have recommended the USPS build on the trust in its brand to offer secure electronic communications services.

The USPS itself has taken a cautious approach to internet-based communications, with Vogel himself warning earlier this month that he believed other postal operators around the world were “losing money” on digital services, something that has been denied by industry commentators.

Vogel said this week that his team had been focused this year on innovations that could benefit the struggling USPS in the short term, but that now he was at a point where he could turn to longer-term issues.

Combining physical and digital

This week’s MTAC meeting at USPS headquarters in Washington DC saw a variety of views from different sides of the mailing industry suggesting that the opportunity for postal operators lies in emphasising the opportunities that lie in combining the physical with the digital side of communications.

There was a lot of enthusiasm, for example, on the direct marketing side with the Postal Service’s engagement with smartphone barcode technology through this summer’s forthcoming Mobile Barcode Promotion. The technology means consumers receiving a physical piece of mail can scan a special code with their smartphones and be taken straight to a webpage with more information or the ability to make a product purchase.

Direct mailers are very keen to get on board with the promotion – even those in the non-profit sector – with the offer of a 3% discount on postage for items displaying QR codes in July and August. There were some issues at MTAC with how the promotion will be monitored and verified, however, particularly with co-mingled post.

On the periodicals side, industry leaders pointed out that while large publishers are expanding online access to publications, it has been a “myth” that internet-based publications were “free” or even cheap to produce, particularly with different formats required for different tablet and computer platforms, and because streaming versions required constant mainenance.

Howard Schwartz, director of distribution, sourcing and postal affairs at magazine publisher Conde Nast said companies like his were having some success in using digital channels to increase subscriptions to print titles.

“We are not trying to get out of print at Conde Nast,” he said.

The US Postal Service has been keen to make use of the internet for retail purposes through its usps.com website, which is set for a revamp later this summer to improve its usability for consumers.

Vogel said the website could also be tied into a new loyalty program for USPS customers, which is something for the future and might resemble airline frequent flyer programmes or supermarket loyalty cards, offering rewards for loyal postal customers.

“We have 5m registered users on usps.com and we don’t have any loyalty programme yet for that base – we have a large base of people and if I can stimulate that, that would be something,” he said. “It could tie in with digital, hybrid and e-commerce services.”

Source: James Cartledge, Post&Parcel

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