As you may have heard, the Postal Regulatory Commission recently approved a 2% postage rate increase. While this is good news for the Postal Service, it poses a bit of challenge for direct mail marketers. With rates steadily increasing year after year, it’s becoming more and more important for marketers to leverage the postage discounts available to them.
In order to ensure our clients maintain a healthy ROI on direct mail marketing campaigns, we often look to mailing methods that maximize discounts offered by the USPS. In fact, exercising mailing strategies that maximize postage savings is a big part of our daily routine here at Wilen Group. There are many criteria and nuances you must meet in order to qualify for discounts, but here are three areas of opportunity where we typically start:
Maintain Database Hygiene
Keeping mailing lists up-to-date is easily one of the best ways to cut postage costs. Not only does running your list through data hygiene help with deliverability, but it also ensures duplicates and non-deliverable addresses are eliminated. It goes without saying, but when you remove addresses you’ll never reach (or are already reaching within the same campaign), you save 100% of the postage you would have otherwise wasted. As simple as this solution sounds, anyone who’s ever managed a large database knows how easy it is for some addresses to fall through the cracks. That’s why even when we receive lists that have been passed through hygiene, we perform one last “Just-in-time” process prior to mailing.
Database Profiling/Scoring
This method builds upon the idea of saving 100% of the postage (and production!) costs you might have otherwise wasted by cutting out addresses from your list. Just like you might cut carbs out of your diet to lose weight, you should remove addresses you shouldn’t be mailing entirely. We lovingly refer to this process as “Trimming the fat.” Use address profiling methods to gain clear insight to the makeup of your prime target audience, and use that information to filter out recipients who represent the furthest demographic/psychographic/geographic makeup from that audience. We highly recommend consulting an expert when exploring this option, but this is perhaps the smartest and most effective way to boost the ROI of any direct marketing campaign. As the proverb says, “Fish where the fish are.”
Consider Every Door Direct Mail (EDDM)
If your direct mail strategy includes hitting every home in a specific neighborhood or ZIP code, Every Door Direct Mail may be your best bet. Offered directly by the USPS, this service provides companies with discounted postage rates for mailing in entirety to a particular area. For example, if you’re offering coupons to your new pizza delivery restaurant, you’ll benefit from reaching everyone in your neighborhood for a far lower cost than standard postage rates.
Of course, this method comes with a catch: your mailer must be a specific size and follow USPS EDDM guidelines in order to qualify. You have zero targeting capabilities, so you risk reaching current customers and cannibalizing revenue. This program was designed for instances specifically like the above example, so savvy direct marketers should anticipate a low ROI when utilizing this option.
Take Advantage of Promotions
If your mailers meet certain criteria during USPS designated promotional periods, the USPS will discount your postage rates. Here’s the list of postal promotions slated for 2015:
- Transpromo – Running from April 1st to June 30th, this promotion encourages direct mail marketers to utilize color variable print technology (VDP) in billing or transactional statement mailings. An upfront postage discount is provided.
- Earned Value – From April 1st to June 30th, the USPS will offer a postage credit for each piece of Business Reply Mail returned by consumers. Several criteria must be met.
- Mail Drives Mobile Engagement – This promotion is designed to illustrate how mobile marketing technology can be integrated with direct mail to make purchasing products and services more convenient. Runs from July 1st to December 30th.
- Advanced Emerging Technologies – Similar to the Mail Drives Mobile Engagement promotion, from April 1st to September 30th the USPS will be offering special discounts on mailers that use enhanced augmented reality or NFC technology within their mailings.
It's clear that there are many opportunities for marketers to save and ensure the best possible performance from mailings. We recommend evaluating each method and implementing as many strategies that work for your business.
