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When it comes to adopting the intelligent mail barcode it seems that mailers don't have much of a choice. With the USPS insisting on the Full
Service variety of the IMb in order to qualify for postage discounts starting in 2014, there now exists a single path to compliance. This Postal Service strategy
will have distinctly different effects upon large volume and small volume mailers.
Service variety of the IMb in order to qualify for postage discounts starting in 2014, there now exists a single path to compliance. This Postal Service strategy
will have distinctly different effects upon large volume and small volume mailers.
When it comes to adopting the intelligent mail barcode it seems that mailers don't have much of a choice. With the USPS insisting on the Full Service variety of the IMb in order to qualify for postage discounts starting in 2014, there now exists a single path to compliance. This Postal Service strategy will have distinctly different effects upon large volume and small volume mailers.
Large Mailers - OK
For the larger mailers, the Full Service requirement isn't a big deal. Most of them are using Full Service already. They've had adequate time, resources, and budget dollars to do the conversion. And the possible loss of postage discounts was an incentive to have their IMb solutions in place in plenty of time.
Because of their high volume of mail, the investments large mailers had to make to convert to Full Service IMb did not have a great effect upon their production cost per mail piece. These organizations are also more likely to take advantage of some of the features that are available through the Full Service program such as free Address Correction Service, IMb Trace, and start-the-clock notification. Though the additional postage discounts for using Full Service are relatively small, the savings realized on every million mail pieces generates a few thousand dollars that help offset the IMb conversion investment.
Small Mailers - Not So Much
But what about the smaller mailers? We're talking about small businesses or organizations that print and mail their own bills, direct mail, and statements. Or community newspapers, family-owned commercial printers, or small lettershops and service bureaus. What benefits do organizations such as these enjoy by migrating to Full Service IMb?
Not many, in the opinion of this writer.
These smaller mailers may have been planning on implementing Basic IMb - a version that provides functionality similar to the Postnet technology that has been in place for decades. The objectives of mailers electing to use Basic IMb were confined to coding the mail for automated sorting and routing within the postal system, and maintaining the associated workshare postage discounts. Mailers could convert to Basic IMb without major disruptions to their familiar workflows or worry about unique mail piece identifying numbers and tray tags. With Basic IMb, mailers could continue to present mail along with familiar paper mailing statements or use the Postal Wizard online to submit their mail.
If the features that were included for free in Full Service IMb were occasionally required on certain mailings, small mailers on Basic Service could pay for those services as they used them - a simple approach that required no enterprise-wide procedure changes.
But Basic IMb won't be eligible for discounts after January, 2014. At that point, the only way to qualify for automation mail postage discounts will be through the more complex, geekier, Full Service IMb.
IMb Trace Not a Factor for Many
The USPS sweetened the pot for Full Service mailers by including IMb Trace at no cost. This mail piece tracking method formerly required a separate investment in a CONFIRM subscription, and extra expense. For large mailers who have established a value of being able to track individual mail pieces as they progress through the delivery network, free IMb Trace is a bonus.
The functionality frequently touted as benefits of IMb Trace, however, are virtually non-existent for small businesses. Very few of these companies track or measure their mail at all. They don't run complex multi-channel marketing campaigns that require precise timing based on delivery dates. They need only an approximate in-home date to plan for inventory or inbound order processing. And small businesses don't make short-notice staffing or investment decisions based on customer payments that are in the mail stream. Experience has taught these companies when the bulk of their payments will arrive, based on the mailing date of the invoices. That prediction is good enough for them.
Small Business Response to Full Service IMb
As we see it, small mailers have five choices:
1. Make the investments to convert to Full Service IMB
(mail service providers may have to do this or risk losing business to competitors)
2. Print their mail pieces without barcodes and send them to a presort bureau for mailing
3. Outsource their entire mailing and printing operation to print/mail service providers
4. Forego automation discounts altogether and pay more for postage
5. Aggressively migrate from postal mail to alternative delivery channels
In each of these cases other than the last, mailing costs will rise for the small mailers. Some organizations, where mail may be prepared by volunteers today, will realize a new out-of-pocket expense as they outsource all or part of their customer communications work. Or they may upgrade their postal software, procedures, and training and do the work themselves, diverting funds from other projects into mail preparation. A few, I suspect, will decide it's too much of a drain on their resources and severely cut the volume of mail they produce. They will eliminate expenses on items such as postage meters and software maintenance, and outsource or pay higher postage rates on whatever mail remains.
After Full Service IMb becomes mandatory to maintain postage discounts we may see more organizations try passing their increased mailing costs along to their customers. This strategy will likely hasten a customer-initiated migration to digital delivery channels. USA Companies that have attempted to charge for mail in the past have faced resistance from customers who object to paying extra for a paper bill or statement.
Technology is Necessary, But ROI for Some Mailers Hard to Find
The ability to locate, track, and account for every container and mail piece in the delivery network is a worthy goal. We are used to this type of functionality as provided by other delivery channels. If the USPS is going to continue as a relevant choice among business mailers, they need to keep up with the competition. Furthermore, uniquely identified mail pieces present an opportunity for new types of functionality and services that could be offered by the USPS or their partners. And there are certainly some postal customers who have a business use for the Full Service features of today.
But for many small mailers the existing benefits of Full Service IMb don't balance the cost and complexity of converting to the program. The effect of this mandate could have an overall negative effect on the industry that supports the mailers with hardware, software, materials, and services. In the small business world, Full Service IMb could actually exacerbate the downward trend in mail volumes - the effect of which could be felt throughout the entire document industry.
Mike Porter is President of Print/Mail Consultants, an independent consulting firm that helps companies nationwide be more productive, adapt to changing requirements, and lower costs in their document operations. For more ideas about using the mail strategically, connect with Mike directly at mporter@printmailconsultants.com. Or visit www.printmailconsultants.com and sign up for Practical Stuff - the free newsletter dedicated to document operations professionals.
Large Mailers - OK
For the larger mailers, the Full Service requirement isn't a big deal. Most of them are using Full Service already. They've had adequate time, resources, and budget dollars to do the conversion. And the possible loss of postage discounts was an incentive to have their IMb solutions in place in plenty of time.
Because of their high volume of mail, the investments large mailers had to make to convert to Full Service IMb did not have a great effect upon their production cost per mail piece. These organizations are also more likely to take advantage of some of the features that are available through the Full Service program such as free Address Correction Service, IMb Trace, and start-the-clock notification. Though the additional postage discounts for using Full Service are relatively small, the savings realized on every million mail pieces generates a few thousand dollars that help offset the IMb conversion investment.
Small Mailers - Not So Much
But what about the smaller mailers? We're talking about small businesses or organizations that print and mail their own bills, direct mail, and statements. Or community newspapers, family-owned commercial printers, or small lettershops and service bureaus. What benefits do organizations such as these enjoy by migrating to Full Service IMb?
Not many, in the opinion of this writer.
These smaller mailers may have been planning on implementing Basic IMb - a version that provides functionality similar to the Postnet technology that has been in place for decades. The objectives of mailers electing to use Basic IMb were confined to coding the mail for automated sorting and routing within the postal system, and maintaining the associated workshare postage discounts. Mailers could convert to Basic IMb without major disruptions to their familiar workflows or worry about unique mail piece identifying numbers and tray tags. With Basic IMb, mailers could continue to present mail along with familiar paper mailing statements or use the Postal Wizard online to submit their mail.
If the features that were included for free in Full Service IMb were occasionally required on certain mailings, small mailers on Basic Service could pay for those services as they used them - a simple approach that required no enterprise-wide procedure changes.
But Basic IMb won't be eligible for discounts after January, 2014. At that point, the only way to qualify for automation mail postage discounts will be through the more complex, geekier, Full Service IMb.
IMb Trace Not a Factor for Many
The USPS sweetened the pot for Full Service mailers by including IMb Trace at no cost. This mail piece tracking method formerly required a separate investment in a CONFIRM subscription, and extra expense. For large mailers who have established a value of being able to track individual mail pieces as they progress through the delivery network, free IMb Trace is a bonus.
The functionality frequently touted as benefits of IMb Trace, however, are virtually non-existent for small businesses. Very few of these companies track or measure their mail at all. They don't run complex multi-channel marketing campaigns that require precise timing based on delivery dates. They need only an approximate in-home date to plan for inventory or inbound order processing. And small businesses don't make short-notice staffing or investment decisions based on customer payments that are in the mail stream. Experience has taught these companies when the bulk of their payments will arrive, based on the mailing date of the invoices. That prediction is good enough for them.
Small Business Response to Full Service IMb
As we see it, small mailers have five choices:
1. Make the investments to convert to Full Service IMB
(mail service providers may have to do this or risk losing business to competitors)
2. Print their mail pieces without barcodes and send them to a presort bureau for mailing
3. Outsource their entire mailing and printing operation to print/mail service providers
4. Forego automation discounts altogether and pay more for postage
5. Aggressively migrate from postal mail to alternative delivery channels
In each of these cases other than the last, mailing costs will rise for the small mailers. Some organizations, where mail may be prepared by volunteers today, will realize a new out-of-pocket expense as they outsource all or part of their customer communications work. Or they may upgrade their postal software, procedures, and training and do the work themselves, diverting funds from other projects into mail preparation. A few, I suspect, will decide it's too much of a drain on their resources and severely cut the volume of mail they produce. They will eliminate expenses on items such as postage meters and software maintenance, and outsource or pay higher postage rates on whatever mail remains.
After Full Service IMb becomes mandatory to maintain postage discounts we may see more organizations try passing their increased mailing costs along to their customers. This strategy will likely hasten a customer-initiated migration to digital delivery channels. USA Companies that have attempted to charge for mail in the past have faced resistance from customers who object to paying extra for a paper bill or statement.
Technology is Necessary, But ROI for Some Mailers Hard to Find
The ability to locate, track, and account for every container and mail piece in the delivery network is a worthy goal. We are used to this type of functionality as provided by other delivery channels. If the USPS is going to continue as a relevant choice among business mailers, they need to keep up with the competition. Furthermore, uniquely identified mail pieces present an opportunity for new types of functionality and services that could be offered by the USPS or their partners. And there are certainly some postal customers who have a business use for the Full Service features of today.
But for many small mailers the existing benefits of Full Service IMb don't balance the cost and complexity of converting to the program. The effect of this mandate could have an overall negative effect on the industry that supports the mailers with hardware, software, materials, and services. In the small business world, Full Service IMb could actually exacerbate the downward trend in mail volumes - the effect of which could be felt throughout the entire document industry.
Mike Porter is President of Print/Mail Consultants, an independent consulting firm that helps companies nationwide be more productive, adapt to changing requirements, and lower costs in their document operations. For more ideas about using the mail strategically, connect with Mike directly at mporter@printmailconsultants.com. Or visit www.printmailconsultants.com and sign up for Practical Stuff - the free newsletter dedicated to document operations professionals.
