Purging the Past! By Todd Butler, Butler Mailing Services, eKEY Technologies
The Postal Service announced on May 16, 2012 that they had hired Nagisa Manabe as Chief Marketing/Sales Officer. She replaces Paul Vogel who takes his Presidency to the newly created postal Digital Solutions Group. Under Mr. Vogel the marketing and sales group continued policies, initiated by the past PMG "Jack" Potter, of an antagonistic and confrontational approach to working with an industry dominated by small mail service providers (MSPs).
"Jack" once famously said that he did not want to talk to any self-serving mail service providers; he only wanted to talk to mail owners. Unfortunately for "Jack" and the legacy of arrogance he left behind, it is not up to postal bureaucrats to dictate the structure of customer relationships within the industry they were hired to serve! Postal employees do not get to choose with whom they will or will not work. My customers hire me to deal with the postal bureaucracy because of the arrogance and confrontational nature of many of these well compensated public servants.
2006 was the year mail volume quit growing. It was also the year "Jack" and his crew decided to implement a redesign of the flat mail stream and its pricing structure. Two years prior to the big recession, these actions initiated the significant unabated downward spiral in mail volumes. Within just a few years of Potter's redesign efforts, flat mail volume was down 32%. Under pressure from the operations group, which saddled the industry with dysfunctional FSS machines (designed to sort the flat mail they purged in 2006) and billions in debt, the same bureaucrats moved on to fix booklets and folded self-mailers.
Has anyone seen a power point showing a reduction in postal processing costs related to these significant mail piece design changes? Certainly there has been an overall reduction in processing costs but these reductions are due to the machines setting idle (no mail to run) not because mail pieces are more efficient to processes! And why has this self-destruction, brought on by postal engineers and the operations group, continued after losing 32% of their flat volume? Because the marketing department refused to speak up for its customers and the need to retain mail volume! I guess they had a more pressing agenda.
More recently the marketing department has plotted its own destructive course by developing programs and policies that are designed to eliminate MSPs. The ultimate goal of the current marketing department was revealed at the April National Postal Forum where their headlined guest speaker from the Sweden Post was asked what they (Sweden Post) had done to generate more revenue. His answer brought a quiet gasp from the audience. 30% of all mail volume in Sweden is generated by Sweden Post printing plants.
The Postal Service's marketing department, led by Paul Vogel, has already started initiating programs intended to generate 30% of US mail volume from USPS affiliated plants. The Jack Potter legacy of only wanting to deal with mail owners has lead this group to initiate postal programs intended to supplant smaller MSPs in the market place. Recent postal programs and policies provide NCOA and presort data services for free, utilize extensive postal sales resources in the promotion of postal affiliated printing and mailing services, and in some retail locations have eliminated the requirement for EDDM mail to be bundled with cover sheets prior to acceptance.
When postal sales people want to make more effective sales calls, they access the names, addresses, and mail volumes of potential clients from the data MSPs are required to provide about their customers. This information is more readily available through the requirement of PAFs for NCOA processing, the old Ghost Number policies and the new CRID (by/for) requirement. Most would call the intent of these postal programs and associated policies unethical; Paul Vogel's marketing group calls it smart business.
After the Postal Forum, people said that congress would never allow the USPS to buy printing plants. And they are correct. But the USPS doesn't have to become a big printer to generate a significant volume of mail. Their way around current law is to partner with specific vendors, provide dedicated marketing and sales assistance as they do with EDDM, and then share in the generated revenue stream, which is a requirement for all postal partners with links on the USPS website or separately through the Direct Mail Hub.
The mantra from Washington based postal employees at the National Postal Forum was that no one wanted to provide services (campaign management, data prep, printing, mailing) to small business customers. This misperception (uninformed or intentional) justifies the USPS filling the supposed void in service offerings. But no studies have been provided supporting the premise that the small business market is underserved by existing companies. Postal management's definition of small ranged from 1,000 piece print runs to 10,000 addresses completely data prepped for mailing at no cost to mail owners. If the USPS marketing team has become responsible for generating 30% of all mail volume (as in Sweden), they will only get there by putting small and medium sized MSPs out of business, therefore creating a void in direct mail services. The fact remains that the problem with mail volume is not a lack of service providers; it is a lack of customers.
The rich and famous in our industry, with people in Washington hired to protect their interests, don't have anything to worry about from postal marketing. It is all the rest of us that have been put in the cross hairs by Vogel's implementation of the Potter legacy. Let's hope the Postal Service's new marketing manager Ms. Manabe, with PMG Donahoe's help, can purge the Potter legacy and forge a new partnership with the MSP industry. It is only working together that we (the USPS and MSPs) will succeed.
Todd Butler, Butler Mailing Services, eKEY Technologies can be reached at 513-870-5060 or email@example.com.
To read the companion piece to this article, click here.
Thursday, September 20, 2012 2:37:58 PM by traveling
I've been away the past couple of months, and I just read that with less than $1 billion in the bank, the Postal Service announced that it would not be making the payment. It has a second payment, for $5.6 billion, due in September. Unless lightning strikes, it won’t be making that one either.
I've worked for the Postal Service for more than ten years and now I want to have a brighter career, here or in another field. Many times I didn't agree with their policy, but being just a simple employee I had to conform to their demands. Personally I don't agree with this new form of payment.
Monday, September 24, 2012 5:56:44 AM by vancouver
It was about time that the Postal Service purged the past, this is one example that highlights why many consumers opt to use more expensive services like UPS and FedEx. This will enable consumers to get the most reliable home delivery service, pay less and get real-time tracking, including delivery notifications.
I didn't think that postal marketing is still a way of making money, i mean technology has evolved and beside internet and phone, information isn't in need of another mean of transport. I think that as along as you have virtual services, don't worry about human ones.
I think that in the past we find the best teachings and we must learn from what we had a few years go in order to evolve. Mailing systems are the best ways of taking the information change to the next level.
Me and my brother are the geeks in our family and we mostly developed our skills through different games and i must thank my parents for this because without them we couldn't fell in love with sciences. Maybe we would have been good at it but that i would have been all.
Well it was about time for the economy to give us a positive feed-back after the major economic crisis from a few years ago.I'm glad that everyone became more careful with money and with everything in general, doing a background criminal check before hiring someone or before taking services from anyone.
I think that developers are really underestimated and they make a really important work these days, they should learn how to relax a little. Programmers also and we really need to learn how to respect them and not make them feel like their job is meaningless.
Purging the past might not be as easy as it sounds, some of the mistakes you make as a teenager can follow you throughout your life, like a criminal record for example. Luckily, public institutions like The Postal Service can be successful at this because the public opinion tends to be more forgiving than the police.
Imagine that this is one of the hardest things to do after you take your first exams. Now imagine how hard is that for people with disabilities. I think that we should hire someone to talk with them and guide them to a good path.