B2B marketers should care about what happens to the USPS

Tequia Burt

Direct mail, the red-headed stepchild of channels, is still an important part of the marketing mix. While true that using channels like email is cheaper for B2B marketers, using direct mail in conjunction with email and other digital channels can be particularly successful. Direct mail can still be a key part of your multichannel strategy.

Additionally, despite declines, we are still spending a pretty penny on direct mail. The Direct Marketing Association's "2012 Statistical Fact Book" projects that $57.6 billion will be spent on direct mail (both catalog and non-catalog) as far out as 2016. And, noted Jerry Cerasale, senior VP of government affairs at the DMA, "For DMA membership, the mail is still an important factor in trying to get new prospects."

This is why B2B marketers should care about what happens to the U.S. Postal Service. Can you imagine a world where you have to send simple mail pieces via a courier? Couriers, of course, have their place, but we still need a cost-effective outlet to send our event flyers, postcards, catalogs and brochures.

When U.S. Postal Service Postmaster General and CEO Patrick Donahoe revealed his plan earlier this year to eliminate some Saturday mail delivery, he seemed like a desperate man. The decision was made unilaterally without Congressional approval, which certainly antagonized members of Congress.

While he said his intention was to prod Congress into action, Donahoe's plan backfired. Late last month the influential Government Accountability Office issued a legal opinion stating that the Postal Service could not stop Saturday delivery without Congressional approval. Shortly thereafter, Congress passed a stopgap budget, which preserves six-day delivery.

Though Congress didn't deliver the results Donahoe wanted, everybody is at least saying they want the same thing—to ensure the long-term viability of the Postal Service. A good first step for Congress would be revisiting the retiree repayment schedule, which costs $5.5 billion a year and is crippling the Postal Service's ability to dig itself out of its fiscal hole.

But for B2B marketers, the stalemate between the Postal Service and Congress is causing an environment of uncertainty for mailers.

"The worst thing that could happen is uncertainty," said DMA's Cerasale. "Will there be Saturday delivery the week of Aug. 5th or will there not? Confusion on that is going to hurt mailers and it's going to hurt the Postal Service. Right now there is still confusion out there."

Hamilton Davison, president and executive director of the American Catalog Mailers Association agreed.

"In the middle of this clear financial crisis within a major piece of our national infrastructure, to get mixed signals and prohibitive action on the move to five-day mail delivery, we need resolution and clarity from Congress to protect this vital piece of infrastructure that supports 8 billion jobs," he said.

While the ACMA has been supportive of the Postmaster General's aggressive cost-cutting measures as long as rates are held down, the DMA has always maintained that a five-day delivery schedule should be a last resort. However, the DMA does support measures to help the Postal Service get its finances under control.

The $2 billion that Donahoe said cutting Saturday delivery would save annually barely makes a dent in the billions the Postal Service continues to lose. But it's a start, and Congress should give the Postal Service some flexibility to fix its problems.

And, really, would eliminating Saturday delivery be so bad? Sure it would require more planning (sometimes that extra day really matters), and it could hurt some B2B businesses. However, the Postal Service's guarantee to still deliver packages on Saturday would alleviate some of that pain. Even Cerasale said that some of the DMA membership's objections to a five-day delivery schedule are lessening as long as some Saturday delivery happens.

Now, the ball is in the Postal Service's court. Cerasale said what happens next with the Postal Service will be up to its Board of Governors, which is meeting in the next week or two to discuss plans. Hopefully, it will help to clear things up for B2B mailers. --Tequia

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