April 24, 2011

Dear Catalog CEOs: USPS


And then there's you, the $50,000,000 annual net sales business, fighting for survival, dealing with the possibility of significant rate hike at some point in the near future.

What you think of the message being sent to big brands who don't use this channel, and of the message being sent to small brands who have used this channel for decades?

2 comments:

  1. I would *not* want to be the USPS these days. They're upside down on so many fronts, that it's hard to see how they are going to pull themselves back up out of the red.

    I spent an interminable 9 months at a large P&C insurance company working on USPS regulations -- trying to get myriad systems all complying with address cleansing requirements in order to maintain bulk mail discounting. Now, a lot of those mailings were more "business" -- billing and statements -- but it seemed like the smartest way to save money there was to incentivize customers to go paperless (which many customers would prefer, anyway).

    It's a different situation, I realize, when you're talking marketing direct mail. But, I wonder if it's the sort of thing, like a sharp rise in gas prices (not looking to set off an economic theory debate here), that might actually force brands of all sizes to start digging into their lists and segmenting and targeting.

    If you jack up my rate by 22%, but I reduce my mailing volume by 25%...I still come out ahead.

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  2. Most of the catalogers I work with target reasonably well ... they just have a 63 year old customer that won't buy online, so if you reduce mailing volume by 25%, you'll reduce sales by about 13%, so the math is not favorable.

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