Late Friday, May 28, 2021, the Postal Service announced they will raise postage rates effective August 29, 2021.
SG360°’s Director of Postal Affairs, Mike Buttita, explains the reason for the increase:
The increase is part of the USPS’s 10-year plan for achieving financial stability. Over the next 10 years, the increase will contribute about $40 billion for investments in technology and infrastructure, and is designed to modernize and improve the Postal Service’s operations. Additionally, during that period, the increase will stave off a projected $160 billion operating loss. The operating loss is attributed to declines in mail volume. In the last 10 years, due to paperless billing and other electronic transactions, total postal mail volume has declined 28%, about 46 billion pieces. Presorted First-Class Mail (postal money maker) has dropped 32%, while First-Class stamped mail dropped 47%.
Snapshot of USPS rate changes
General increase – 6.8%. Excludes package services.
Retail First-Class Stamp – increase of 5.5%, or three cents, from $0.55 to $0.58.
Retail First-Class Postcard – approximately 11% increase, or four cents, from $0.36 to $0.40.
First-Class Automation Letter – average increase 7.5%.
First-Class Automation Postcard – average increase 14.05%.
First-Class Automation Flat – ounces one through four see an average increase of 12.85%.
Standard Mail Automation Letter – average increase 7.9%.
Standard Mail Carrier Route Letter – average increase 5.3%.
Standard Mail Automation Flat – average increase 9.6% (additional sort/rate increment added).
Standard Mail Carrier Route Flat – average increase 7.2% (additional sort/rate increment added).
Non-Profit Automation Letter – average increase 7.4%.
Non-Profit Carrier Route Letter – average increase 11.6%.
Non-Profit Automation Flat – average increase 12% (additional sort/rate increment added).
Non-Profit Carrier Route Flat – average increase 12.5% (additional sort/rate increment added).
Marketing Parcels – average increase 11.7%.
As a result of the USPS rate changes, industry-wide “all-in” commingle pricing will be adjusted to align with the new rate structure, also effective August 29, 2021.
Actions to preserve direct mail’s substantial ROI
In order to mitigate the impact the new postage rates have on the return from your direct mail campaigns, see which items on the following list you are not taking advantage of. Each of these items are relevant to almost every direct mailer.
- Optimize postage; commingle
- Leverage the full benefits of Informed Delivery
- Understand your ROI potential with Direct Mail Retargeting
- Evaluate the efficiency of your printing process (e.g., web inline vs. sheetfed vs. digital print)
- Explore opportunities to use data for hyper-targeting (resulting in decreased volume with greater return per piece)
- Implement campaign testing and optimization strategy
- Explore cost-efficient formats
- Automate workflows for
- intelligent proofing
- centralized asset and offer deployment
- triggered, personalized ad construction
- image optimization
If you’d like our help in evaluating these strategies for your particular case, contact us here.