How to Prepare Your Mailings for Maximum Efficiency and Savings.

With the high rate of automation at the post office, the importance of
preparing mail increases. Just barcoding is no longer enough–now the post
office wants things properly bundled, trayed, sacked, palleted, and so on.
These requirements plus the importance of mailpiece design give you a lot
to think about when preparing a mailing. Fortunately, help is available; you
can study the Domestic Mail Manual or contact your local post office or a
support specialist. Several post offices, particularly in major metropolitan
areas, have mailpiece design and classification support specialists to assist
you.
Also, an organization or local Postal Customer Council that you belong to
may feature some presentations on cost-effective mail presentation. Lastly,
you can contact the National Customer Support Center at 800-238-3150 for
information about matters such as address information support products.
Here, MCMR takes a look at a list of suggestions from one such support
specialist.

The Cost of Mail

As you know, there is much more to the cost of mail than the postage.
Approximately a third of the cost lies in the design of the piece,
according to Peter Furka, a classification support specialist in New York. The
design process includes the artwork, layout, and copy. The production of the
mailpiece itself comprises another third of the cost and includes
production and printing.

The last part of the cost comes from actually mailing out the piece.
Naturally, you can save money at every step. You can alter the design, use
different qualities of paper, send out letter-size pieces instead of
flats, and select different levels of postage. The choices can sometimes be
daunting.

As part of the sending-out-the-mail process, you might also consider the
cost of the address list, or database, that will be used.

Location Is Everything

In mailpiece design, location is everything. The address, the postage, the
return address, and the barcode all must be within prescribed boundaries
so that the machines can read it–and you can get your discount.

Another important aspect of location is where the recipients are–in other
words, you need updated addresses. Of course, automated mailings are
required to have a change of address endorsement.

The change of address endorsement is important because people move around a
lot in this country. After six months, you have a 10% risk of having an
invalid address, since 25% of all people move each year. Putting in a
change of address is not always a simple step for people; they have to pick up
and fill out a form to do so. There is no online change-of-address system
because of security risks.

There are four levels of ancillary services: address (send the address and
the piece), forwarding (to new address), return (to sender), exchange (don't
want the piece back, but want the information). The ancillary service-requested
line can be placed in one of four locations on the mailpiece, which allows
for some flexibility. It can be next to or under the postage, 1/4 inch under
the return address, or above the sending address (see graphic).

Ways to Pay

There are different methods to pay your postage. You can get:

* Precancelled stamps (no fee);

* Postage meter (no fee, but do have re
nt); or

* Permit imprint (additional one-time fee of $125 required).

Media Advertising Expenditures

Market
Share
1988 1998 1988-1998

Newspapers 26.6% 23.4% -3.2%
T.V. 22.0 22.4 0.4
Direct mail 15.5 19.3 3.8
Yellow pages 5.7 7.1 1.4
Radio 7.0 6.6 -0.4
Magazines 5.6 5.3 -0.3
Bus pubs 2.8 2.4 -0.4
Other 14.8 13.5 -1.3

(Source: Robert Coen)

Permit imprint is cheaper, but precancelled stamps often get more response
from customers when you run an ad mail campaign. Postage meters are the
easiest option for most mailers. However, you have to reload the meter
regularly. You put out money–and lose the float–plus pay rent on the
meter box. In addition, the postal service is phasing out having meters brought
in to be refilled, which gives mailers only two options: allow the meter
company access to the company bank account for an automatic debit or send in a
check and face possible delays in getting the meter refilled.

Standard Mail

By now, you should know that Standard A mail is just plain Standard Mail.
In this class, as most others, the size and shape of the mailpiece can make
the difference in your postage costs. For example, there is no separate rate
for postcards within Standard Mail. If you mail cards that are no longer than
4-1/4" by 6" you should compare Standard Mail presort rates with $0.20
First Class single-piece card rate.

Also, rates are lower for letter-sized pieces than they are for flats that
are less than 3.3 ounces, so you might consider folding your mailpiece to be
more cost-effective.

Advertising Mail

Mail is the third largest advertising medium after TV and newspapers. It's
the fastest-growing medium over the last 10 years (see chart of costs). The
Internet hardly made a dent in ad mail, since a number of Web sites use ad
mail to draw people to their sites.

In part, ad mail is so widely used because it tracks results and provides
reports, addresses, customer characteristics, and usage patterns. It
offers businesses the opportunity to become involved in the customer's purchase
behavior.

Financial Considerations for a Mailpiece

What can your company afford to spend on the mailpiece? How many responses
are needed to meet your goal? You can justify some expenses by looking at the
potential response rate.

To ensure that your mailing works, it must have a specific target, it must
be measurable, and it must be cost effective.

With your mailing list, you have two basic options. A saturation mailing,
which targets every address within a certain geographical area, and a list
mailing, which targets specific names or titles on a specific mailing
list.

Marketing people do have room to work with the mailpiece design within the
parameters of postal requirements. They can use logos or teaser copy, for
example.

However, if you want to keep costs down, you need to keep certain things in
mind. For example, square-shaped envelopes may look different, but don't
go through machines well. Because of that, there is a surcharge for a square
mailpiece.

Likewise, the paper can make a big difference. Thin paper that allows
"bleed through," which means you can see the content copy through the envelope,
might confuse the machines. Background patterns can also make reading the
address difficult for machines. Dark fibers, such as you might see in some
recycled paper, are another problem.

Windows must be the right size. Ideally, the address needs to show through
with 1/8 of an inch of space on all sides. A small mailpiece in a large
envelope allows shifting–and the address can be cut off from view.

Flat Mail

Standard mail flats are packaged and sacked; however, preparation as
packages on pallets is permitted and preferred. If the mailpiece weighs more than 0.12 lb., use the 15 lb. minimum when making sacks to destinations.

If the mailpiece weighs less than 0.12 lbs., use the 125-piece minimum when
making sacks to destinations.

With the new rate case, the discount for automation flats has decreased,
since both nonautomation- and automation-rated flats can be processed with
machines because the cost difference is much narrower. A mailer-applied barcode is of less incremental value because, in many cases, the flat could be
automatically sorted without it. But, there is still a cost difference–4.4 cents for the basic automation rate and 2.7 cents at the 3/5 rate. Overall, the postage cost for both automated and nonautomated flats rose with the new rates, since the USPS says the cost of handling this type of mail rose faster than that for letter mail.

The 3/5 digit rate for flats was split into three-digit and five-digit
rates, in response to mailers' suggestions. The three-digit first-ounce rate is
29.5 cents and the five-digit first ounce rate is 27.5 cents. Preparing mail to
the five-digit rate is optional. Five-digit and carrier route flat bundles
must be placed in separate sacks and on separate pallets for zones that are
processed in the plant.

For first-class flats, the postal service changed its standards for the
preparation of five-digit packages and five-digit trays of automation
flats from required levels of sortation to optional levels of sortation. There
is also a new tray-based presort option for automation flats. Mailers don't
have to prepare automation flats in five-digit, three-digit, ADC, and mixed ADC
packages. Instead. mailers can prepare flat trays when 90 pieces or more
are going to a presort destination, and put the remaining pieces in a mixed
ADC tray with no minimum tray quantity.

Production and Mailing Automation

With automation letters, no packaging is permitted except in less-than-full
trays, or for postcard-sized pieces. There must be 10 pieces or more per
carrier route.

A carrier route package must be prepared when there are 10 addressed pieces
or more or 10 pounds or more, whichever happens first, for an individual
carrier route. The maximum weight is 40 pounds. When there is a minimum of 20
pieces or 20 pounds, a direct carrier sack must be prepared.

ISSN 1085-6692; Issue 03-01; Page 1,12-14

For more information, please contact IOMA Subscriber Services,
212-244-0360;
fax: 212-564-0465; email: [email protected]. Visit our Website at
www.ioma.com. Copyright 2001 Institute of Management & Administration, 29
W.
35 Street, New York, NY 10001-2299

(c) 2001 Resp. DB Svcs. All rts. reserv.
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MAIL CENTER MANAGEMENT REPORT, 01st March 2001