Mailing Systems Technology September/October 2016 by MadMen3

WHAT TO SEE AT GRAPH EXPO: SOLUTION SPOTLIGHTS | PAGES 16-19 SEPTEMBER - OCTOBER 2016 www.MailingSystemsTechnology.com

DEMYSTIFYING

UAA MAIL. PAGE 28

SOLVING

THE INSOURCING VS. OUTSOURCING CONUNDRUM. PAGE 24

BUILDING

A WINNING MULTICHANNEL DIRECT MAIL CAMPAIGN. PAGE 26

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TABLE OF CONTENTS

SEPTEMBER - OCTOBER 2016 | VOLUME 29 ISSUE 5

FEATURES

DEPARTMENTS/COLUMNS

Supervisors

Staff

Fifty-nine percent of mail centers had supervisors, compared to 41% without. This is a substantial increase from last year, when only 45% of our respondents reported having supervisors in their mail center. Sixtyfive percent of the supervisors were male, compared to 35% female. On average, the supervisors held the following certifications. The numbers for EMCMP are up compared to last year, but the other two certifications are down a couple of percentage points.

Average Wages of Mail Center Staff

10.71%

Average Monthly Outgoing Mail Volume 29.41%

10.71% 7.14%

2014 - $12.26

2015 - $15.38

2016 - $13.64

2014 - $12.48

2015 - $15.62

2016 - $14.72

2014 - $12.43

2015 - $15.34

} Seventy-nine percent are not responsible for other departments or functions.

2016 - $14.36

Number of mail supervisors decreased

2014 - $15.97

Working additional hours

Salary concession

2015 - $18.33

Salary freeze

Took on additional responsibilities

2016 - $19.60

Has had no effect

} The average tenure in the mailing industry is 13 years.

2014 - $11.20

} On average, they supervise nine employees.

0 Entry-Level

Addressing machine operators

Highest hourly wage

Inserter operators

53.57%

As the editor of a media that strives to be the top industry resource for mailers, I am naturally thrilled that over half of the supervisors who engaged in continuing education this year chose to do so through their local PCCs. PCCs are a fantastic resource (I attend the meetings in the Madison area from time to time) and a wonderful way to connect and learn from fellow mailers. I’m so glad to see this option utilized! And the fact that even more supervisors than mail center managers utilize this option attests to its importance!

10.71%

3.57%

9.62%

11.54%

9.62%

1.92%

Local PCC conferences/meetings

MAILCOM

Vendor’s user conference

National mailing “schools”

Other non-mailing national conferences (i.e., management training courses)

National industry or associationspecific mailing conference

10%

16%

75,000 or more

19.23%

7.14%

(MSFA, NACUMS, Non-profit, DMA) 22

14%

50%

20,000 - 49,999

Other non-mailing local conferences

None, due to budget cutbacks

Online continuing education classes

None, didn’t find the time to attend

On-site continuing education classes

None, training is not allowed for supervisors

Has had no effect

Existing staff work additional hours

Salary concession

Existing staff do additional tasks

Salary freeze

Other

Layoffs

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

Mail & Technology Merge

National Postal Forum (NPF)

Could We Have Postal Reform in 2016? By Kim Mauch 10%

5,000 - 19,999

40 30

21.43%

10.71%

3.57%

Postal Affairs

17.86%

14.29% 14.29%

3.57%

31.37%

1 million or more

< 5,000 48.08%

It is once again time to look at the results of our annual survey, where we report on wages, staff sizes, mail volumes, and more. By Amanda Armendariz 14.29%

5.88%

500,000-999,999

Average Incoming Mail Volume

Staff and the Economy

Real Life Management

Decisions, Decisions… By Wes Friesen

19.61%

13.73%

50,000-299,999

50,000 - 74,999

A Look at Our Industry 10

Less than 50,000 300,000-499,999

Mail handlers

Continuing Education

9.5%

29%

52%

Parcels

17.86%

} The average salary for a mail center supervisor is $49,480, up slightly from last year’s $48,402.

First-Class Mail

Supervisor Vitals

Going Up, Up, Up… By Amanda Armendariz

9.5%

Standard

25%

2% CMM

Editor's Note

Percentage of mail processed as Periodicals

42.86%

2015 - $12.60

CMDSM

2016 - $12.34

13% EMCMP

The gender breakdown in staff members is relatively equal, with 48% female and 52% male. On average, mail center staff have been in the industry for 9.75 years. The average mail center, according to respondents, has a turnover rate of just under 10%. Over 92% are not represented by a union, and only 21% have employee incentive programs.

Supervisors and the Economy

Number of Company Employees Fewer than 10

13.73%

10-99 100-500

Direct Mail’s Appeal Transcends Generations and Technology By Vincent DeAngelis 43.14%

21.57%

500 or more

MailingSystemsTechnology.com | SEPTEMBER-OCTOBER 2016

Direct Mail Evolution

The Current Printer/Mailer Conundrum By Joy Gendusa

24 Outsourcing Print — Smooth Sailing or Stormy Seas?

The decision whether or not to outsource can be a complicated one, but here are some factors to take into consideration. By Gina Ferrara

Building a Winning Multi-Channel Campaign: Part Two When designing a successful, engaging campaign, don’t forget the most important aspect: the call to action. By Dave Lewis

The Trenches

Small Data Can Make You a Big Success By Mike Porter

Solution Spotlights

What to See at Graph Expo

Say What?

Demystifying UAA Mail

Where does Undeliverable as addressed mail come from, and how do you fix it? By Gary A. Seitz

APPLICATION ARTICLE 15

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

Optimize Your Sorting Operations NPI

EDITOR'S NOTE

VOLUME 29, ISSUE 5 MAGAZINE STAFF

GOING UP, UP, UP…

Publisher Ken Waddell Editor Amanda Armendariz amanda.c@rbpub.com Editorial Director Allison Lloyd allison.l@rbpub.com

WITH AMANDA ARMENDARIZ

Contributing Writers Vincent DeAngelis, Gina Ferrara, Wes Friesen, Joy Gendusa, Dave Lewis, Kim Mauch, Mike Porter, Gary A. Seitz Audience Development Manager Rachel Chapman rachel@rbpub.com

Our September/October issue of Mailing Systems Technology is always one of my favorites of the year. No, I’m not happy that putting this issue to bed means that summer is effectively over, but I love seeing the trends that develop as we analyze the results of our annual survey. Sometimes the results are disheartening, yes, as they were a few years ago during the drastic economic downturn. But, as they say, what goes down must come up, so it’s always gratifying to see that things are indeed on the upswing after a few bad years. And this year, I was more than pleasantly surprised by the results; I was ecstatic. We’ve all been hearing for the past few years that mail volumes are way, way down, right? And, for a lot of organizations, that is indeed true. But it’s not true for everyone, and I think that is what a lot of industry commentators miss sometimes in their reporting. This year, the number of organizations who reported sending out more than 500,000 mail pieces a month grew substantially compared to last year. How encouraging! Now, of course I realize that we do not have the same respondents every year, and therefore it’s not as though we can definitively state that mail volumes for some organizations have more than doubled in one year (how amazing that would be!). However, it is a very good sign that mailers are reporting that they are sending out more and more pieces on a monthly basis. And not just a few more, but hundreds of thousands more! After all, we know mail works (we’ve been saying it for years!) so it’s extremely satisfying to see this uptick in volume. For more on the survey results, turn to page 20. As always, we at Mailing Systems Technology will be at Graph Expo, so please stop by our booth. I’d love the chance to chat with our readers about the survey, mail in general, and what we can be doing to maintain our position as the top industry resource for mailers. See you in Orlando!

Advertising Ken Waddell (o) 608.442.5064 (m) 608.235.2212 ken.w@rbpub.com Design Kelli Cooke RB Publishing Inc. 2901 International Lane Madison WI 53704-3128 Tel: 608.241.8777 Fax: 608.241.8666 Email: rbpub@rbpub.com SUBSCIRBE Subscribe online at www.MailingSystemsTechnology.com. Subscriptions are free to qualified recipients: $20 per year to all others in the United States. Subscription rate for Canada or Mexico is $40 per year, and for elsewhere outside of the United States is $45. Back issue rate is $5. Send subscriptions to: Mailing Systems Technology, PO Box 259098, Madison WI 53725-9098 Call 608.241.8777 Fax 608.241.8666 E-mail rachel@rbpub.com Online at www.MailingSystemsTechnology.com. REPRINT SALES ReprintPro 949.702.5390 www.ReprintPros.com All material in this magazine is copyrighted ©2016 by RB Publishing Inc. All rights reserved. Nothing may be reproduced in whole or in part without written permission from the publisher. Any correspondence sent to Mailing Systems Technology, RB Publishing Inc. or its staff becomes property of RB Publishing Inc. The articles in this magazine represent the views of the authors and not those of RB Publishing Inc. or Mailing Systems Technology. RB Publishing Inc. and/or Mailing Systems Technology expressly disclaim any liability for the products or services sold or otherwise endorsed by advertisers or authors included in this magazine. MAILING SYSTEMS TECHNOLOGY (ISSN 1088-2677) [Volume 29 Issue 5] is published six times per year, (January/February, Annual Industry Buyer’s Guide, March/April, May/June, September/October, November/December) by RB Publishing Inc., 2901 International Lane, Suite 100, Madison WI 53704-3128, 608-241-8777. Periodical postage paid at Madison WI and additional offices.

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

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REAL LIFE MANAGEMENT

By Wes Friesen

DECISIONS, DECISIONS…

ne of the key responsibilities for all of us in leadership roles is decision making. Somebody has to make a decision — and that somebody is often us! Let’s explore some key concepts of decision making, and we’ll look at an approach that may be helpful to us. The first concept is the distinction between “programmed” versus “non-programmed” decisions. Programmed decisions are repetitive, well-defined, and can be resolved by following existing procedures. Examples of programmed decisions include when to reimburse for travel expenses, how to fill an open position, and how much to pay for overtime work. Non-programmed decisions are more challenging because they are unique and sometimes poorly defined, and no procedure exists for solving the problem. Relying on our intuition and experience may be adequate for “simple” non-programmed decisions. But for the more complicated non-programmed decisions, we need more than just intuition to make optimal decisions. We need to add rational decision making, which is based on systematic analysis of a problem followed by choice and implementation in a logical sequence. One simple rational approach that sometimes can help us is the pro versus con method that was originally popularized by Benjamin Franklin. This approach involves writing down a list of reasons for or against a particular decision. You can then whittle down the list to the most salient points and subsequently make your decision. Many of our decisions will require a more elaborate approach. Following is a rational decision making model that you may find helpful.

eight sequential steps and a real-life example involving one of my teams: 1. Monitor the decision environment and identify a problem. A manager monitors information that indicates a deviation from acceptable behavior or results. For example, I had a team that I started managing that was not meeting their expected service level standard of same-day processing of transactions. The new supervisor recognized the deviation too, so we agreed we had a problem to resolve. 2. Define the decision problem. The manager responds to deviations by analyzing essential details of the problem. This can include looking at why current performance is not acceptable and a high-level analysis of potential causes. In my example, when the team does not meet the expectations of same-day processing of transactions, internal and external customers are adversely impacted. The cause appeared to be that the team was understaffed. 3. Specify decision objectives. The manager determines what performance outcomes should be achieved by a decision. The decision objective for my example was for the team to find a solution so that all transactions could be processed same-day and within targeted accuracy levels.

Rational Decision Making Model

4. Diagnose the problem. In this step, the manager digs below the surface to analyze the root cause of the problem. This might include gathering additional information to support the diagnosis. My team was not meeting expectations because they did not have adequate staffing. Inadequate staffing also did not allow for more extensive cross training and pursuit of process improvements that could help meet the desired objectives.

The model follows an eight step approach, which has been modified from a model formulated by Dr. Richard Daft. Here are the

5. Develop alternative solutions. Before a manager can move with a decisive action

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

plan, she must have a clear understanding of the various options available to achieve the desired objectives. The supervisor and I came up with three alternatives to meet the need for increased staffing: 1) Have the staff work ongoing overtime; 2) Hire regular employees; or 3) Add temporary contingent workers (contractors). 6. Evaluate alternatives. This step may include the use of statistical techniques, personal experience, and advice of others. The merits of each alternative are evaluated, as well as the probability it will achieve the desired objective. In the example, alternative number one (working overtime) could help in the short run but would not be sustainable longer term and could lead to staff burnout. Alternative number two, hiring regular staff, would help meet the objective but would be hard to get approved, and would lead to a long-term labor cost increase that may not be needed. Alternative number three, adding contingent staff, would help meet the objective and give us future flexibility. 7. Choose the best alternative. This step is when the manager chooses the single alternative that has the best chance for success. In the example, we chose adding contingent staff. This provided the additional staffing needed to help meet the same-day processing goal, and also enabled cross-training among tasks and some time to look at process improvements. We also maintain future staffing flexibility and can reduce staffing in the future without layoffs or paying severance. 8. Implement the chosen alternative. This is where the rubber meets the road. This is the core of the decision making process because any decision that isn’t successfully implemented is a failed decision, no matter how good the chosen alternative looks on paper. In the example case, we

brought on contingent staff, and now we have completed additional cross-training, process improvements, and are consistently meeting the same-day processing objective with exceptional accuracy rates. I suggest a ninth step, which is to evaluate the implementation and take corrective actions as necessary. Often our rationally based decisions work out well, but when they don’t, we need to learn from our mistake and make things right.

Look Out for Biases The reality is that we are all susceptible to biases. Biases can distort our decisions, so it’s important to be aware and avoid them. Here are some biases to be aware of: 1. Being unduly influenced by initial impressions. We need to be careful to not allow initial impressions, statistics, or estimates act as an anchor to our subsequent thoughts and judgments.

2. Seeing what you want to see. We frequently look for information that supports our existing instinct or point of view and avoid information that contradicts it. 3. Being overly influenced by emotion. Our emotions can cloud our thinking and negatively influence our decisions — we need to be rational and consider relevant information. 4. Escalating commitment. This is the temptation to “throw good money after bad” — our temptation is to continue to invest time and money in a solution despite evidence that it is not working. 5. Too loss-adverse. Many managers have a tendency to analyze problems in terms of what they fear losing rather than what they might gain. We need to avoid overweighting the value of potential losses and underweighting the value of potential gains.

6. Groupthink. Many decisions are made by groups, and the desire to go along with group members can bias decisions. Groupthink refers to the tendency of people in groups to suppress contrary opinions. One antidote to the above biases is to pursue evidence-based management. Evidence-based (aka fact-based) management means a commitment to make more informed and intelligent decisions based on the best available facts and evidence. Another antidote is to encourage dissent and diversity, which is especially important the more complex the circumstances are surrounding a decision. Sometimes it’s helpful to assign a devil’s advocate or have a group time of “black hat” thinking (asking what’s bad or can go wrong with the proposed idea). The purpose is to challenge the assumptions and assertions of the group and ensure decisions have been thoroughly vetted. ¾

Wes Friesen is a proven leader and developer of high performing teams. Wes and his teams have earned multiple awards from a variety of organizations over the years. He has extensive experience in leadership and management roles, in both the business and non-profit worlds. His new book, Your Team Can Soar! Powerful Lessons to Help You Lead and Develop High Performing Teams, can be ordered from Xulonpress.com/bookstore or wesfriesen.com (under Book). Wes can be contacted at wesmfriesen@gmail.com

MailingSystemsTechnology.com | SEPTEMBER-OCTOBER 2016

POSTAL AFFAIRS

By Kim Mauch

COULD WE HAVE POSTAL REFORM IN 2016?

n a surprise move this July, the USPS House Committee on Oversight and Government Reform advanced its “Postal Service Reform Act of 2016” out of committee. Attempts in the Senate to get similar legislation out of committee have failed, but this bi-partisan effort in the House is an important step to getting this proposed bill passed. What’s in the Bill Healthcare and benefits House Resolution 5714 concentrates quite a bit on the cost of healthcare for postal employees and retirees. Labor costs for USPS account for around 80% of their expenses, so maximizing the benefits associated with those costs is key to a solvent Postal Service. Currently, USPS employees share in the Federal Employees Health Benefits Program (FEHBP) with most other federal employees. However, due to the physical nature of their jobs, most postal employees are in better shape than their federal counterparts. H.R. 5714 establishes a separately rated postal plan within FEHBP, which is likely to reduce insurance rates for those who enroll. Additionally, this bill will enroll all Medicare eligible retirees and family into Medicare Part A and B. USPS has paid into Medicare for years; however, employees were not enrolled in this program. By allowing postal retirees to use Medicare for their insurance needs first, the postal service will cut the cost of supporting its aging retiree contingent. This will also allow USPS to slowly decrease the premium USPS pays for Medicare Part B, down to zero percent in the fourth year. Union members are not a fan of this part of the bill, as retirees will have to pay the difference to keep their current level of insurance. Also for retirees, this bill would allow USPS to spread their prefunding of the

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

Retiree Health Benefit program over 40 years, and if any surplus exists, it would be returned to the Postal Service. Operations and personnel Interestingly, this bill proposes that the current nine-member Board of Governors would be reduced to five. This is mainly interesting because the Board has been functioning with only one member this

delivery in 2014, which was not well liked and finally suspended when their liberal party took control of the government. The US bill seems more manageable, requiring resident approval and allowing for exceptions. Under the bill, USPS could increase postal rates for market-dominant products by 2.15%. Interestingly, this number is half the amount that was used during

Under the bill, USPS could increase postal rates for market-dominant products by 2.15%. Interestingly, this number is half the amount that was used during the exigency increase. year. Current nominees have been stuck in the Senate, so even with the reduced complement, the current Board would not fill those requirements. The board would also set the compensation for the Postmaster General and Deputy Postmaster General, who would continue to be appointed by the board. The bill also requires that the Postal Service appoint a Chief Innovation Officer and combines the Postal Service and PRC Offices of Inspector General. The bill would require the incremental conversion of mail delivery to centralized delivery. Business deliveries would be required to migrate, and residential areas would convert when 40% of the residents consent to the new “cluster box” deliveries. Canada Post started an aggressive conversion to centralized

the exigency increase. With the Consumer Price Index hovering under one percent this year, this would be the only way for USPS to raise their rates considerably. The Postal Regulatory Commission (PRC) would also need to review the market-dominant rate system by 2018. Interestingly, the bill would remove political committees from those eligible for nonprofit rates. The PRC would also conduct a one-time review of the USPS cost allocation methodologies, something mailers have been asking for many years. H.R. 5714 also authorizes USPS to offer non-postal services, as long as there is a public notice and approval by the Board of Governors. Any of these agreements would need to be reported on and considered by the PRC to ensure that they cover their costs.

Lastly, the bill outlines additional guidelines for the Postal Service to consider when closing post offices. USPS would need to consider distance, terrain, and broadband availability when evaluating a potential closure, along with allowing the community to comment and appeal any closures. What’s missing There were a few notable proposals that were absent from the bill. The most striking was the absence of reforming the prefunding requirements for healthcare for current employees. The prefunding mandate established in the Postal Accountability and Enhancement Act of 2006 (PAEA) has had a major negative impact on postal finances, and many of the pre-payments have been missed. However, Congress uses these accounts to help balance the overall budget, so this reform was not included. Several years ago, USPS was pushing hard to get approval for five-day delivery of letter and flat mail. But after legislative non-action and the surge of parcel shipments, five-day delivery is no longer considered by the postal service to be a cost savings measure.

H.R. 5714 still has a long way to go before it lands on the President’s desk.

isn’t likely to happen before November. The best chance is in the lame duck session, which will depend greatly on the results of the election. This is a real possibility — the Postal Accountability and Enhancement Act (PAEA) was passed in

the lame duck session of 2006. If H.R. 5714 isn’t approved before January 20, the process will start all over again. While the window for reform is small, this is the closest we’ve seen a reform option since 2006. ¾

Kim Mauch is a subject matter expert in mailing preparation and submission at Satori Software. Contact her at kmauch@satorisoftware.com.

From discussion draft to law If you remember the process from Schoolhouse Rock, after a bill is passed out of committee, the next step is for the entire House to vote on it. But before then, the Congressional Budget Office (CBO) will need to rate it to ensure the fiscal soundness of the bill. The Ways and Means Committee would also need to review the bill as they oversee the Medicare system. If approved by the CBO and the House, it would be sent over to the Senate, whose committee will review and revise it, before bringing it to a larger vote. If both Senate and House can agree to the terms, then it will be up to the president to approve or veto it. Chances for success H.R. 5714 still has a long way to go before it lands on the President’s desk. Even with its bi-partisan roots, it’s unlikely to emerge from the Senate in its current form. With a contentious election season gearing up, the next step of progress

MailingSystemsTechnology.com | SEPTEMBER-OCTOBER 2016

MAIL & TECHNOLOGY MERGE

By Vincent DeAngelis

DIRECT MAIL’S APPEAL TRANSCENDS GENERATIONS AND TECHNOLOGY

ne of my few guilty pleasures in the summer is to lie in my backyard hammock on a Saturday afternoon and listen to the New York Yankees game on the radio. As is tradition, the game is preceded by our National Anthem — brought to you by a financial company. First pitch sponsored by an internet service. First walk brought to you by an urgent care center. Speed of the first pitch brought to you by some timepiece manufacturer. Fifteenth out brought to you by some insurance firm; not sure if it’s the one represented by the lizard or the one represented by the 50s waitress. All brought to you by some home improvement sponsored booth. Forgive me if I am not exactly accurate about who sponsors what; I tuned in to listen to my beloved Bronx Bombers. The point is, these advertising drop-ins are just a few of what is estimated to be 5,000 advertisements a day. Seems too high, right? Well, think about it — if you sleep eight hours a night, you are exposed to more than five advertisements per waking minute. Still think that’s impossible? We are besieged with a tidal wave of advertisements every day. TV, radio, Google, Facebook, Yahoo, the aforementioned drop-ins — advertisements are everywhere. And don’t forget about the omnipresent brand placement advertising. Besides my obvious irritation that I can’t listen to a ball game without being intruded upon, what’s my point? The effect of advertising is diluted because these days, businesses can place advertising on anything and everything. Why do certain messages pass through our personal screening filters and remain compelling for future buying

decisions? What mode of advertising is most effective to break through this clutter? If I could answer that last question, I could probably buy the Yankees and wish all the drop-in advertisements to the cornfield.

Perhaps unexpectedly, young people respond to direct mail. A recent survey showed that 77% of Gen X and 63% of Gen Y have purchased products through direct mail.

Conversing With Customers on Their Terms However, we do know that there is no silver bullet for this conundrum. Customers need and demand choices when it comes to conversing with them. With the many existing marketing channels we have today, not to mention new ones that seem to pop up on a daily basis, potential and existing customers can be anywhere. An effective multi-channel marketing plan where businesses reach their customers through different media allows the recipient of the messages to decide. Traditional marketing paradigms have been challenged, thanks to the explosion of channels available to customers. Bedrocks of marketing and advertising, like targeted messaging, have been altered by the bombardment of impressions seen on a daily basis. Customers who see advertisers’ messages must be engaged enough to associate the sender with the content. Customers mustn’t be given the incentive to fast-forward their DVRs, change radio stations, or speed-click from one website to another.

As Platforms Change, So Will Direct Mail There is no question that direct mail will need to change in our expanding and evolving digital-centric world. The USPS is well aware of the implications that await it as mobile technologies, social media usage, and multi-channel marketing change. The good news for the direct mail industry is that the leadership at the Postal Service is poised to take advantage of these changes. In 2015, the USPS offered promotions that generated more than 11 billion pieces of mail. Many of those promotions are targeted for the next generation of direct mail advertising, and they have continued that strategy in 2016.

Direct Mail, The Solid Performer There is one form of media that constantly and consistently delivers a solid performance: direct mail. In a recent study by the USPS, 61% of businesses were extremely satisfied with direct mail. And among those highly satisfied, 39% expect to increase their direct mail spend.

Innovative Interaction Promotions like Emerging and Advanced Technology/Video in Print, which encourages direct mailers to incorporate interactive technology, and the Tactile, Sensory, and Interactive Mailpiece Engagement promotion, which allows mailers to use “sensory” engagement to drive increased customer response via paper, inks, and interactive mailpieces, are just a few examples of the innovative thinking coming from postal headquarters. As marketers adjust to the ever-changing landscape, it is my hope that the phrase “play ball” stays advertising free. ¾

Vincent DeAngelis is Vice President, Postal Relations, Neopost USA. Headquartered in Milford, CT, Neopost USA provides mailing, business communications management and shipping hardware and software solutions. As businesses increasingly move to digital communications, Neopost USA continues to help its customers communicate via physical mail, digital communications and parcels. For more information on Neopost USA, visit www.neopostusa.com.

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

DIRECT MAIL EVOLUTION

By Joy Gendusa

THE CURRENT PRINTER/ MAILER CONUNDRUM

hile businesses are expected to spend more overall on marketing this year, direct mail is losing ground to digital channels — fast. Look at these predictions for 2016: } Online display advertising is expected to jump 20.1% } Spending on all digital advertising is expected to go up by 15.3% } Direct mail spending is expected to grow just .4% And that .4%, according to the marketing consultants at the Winterberry Group, is thanks to political candidates. These days, business owners simply expect more from their marketing. They want their campaigns to be integrated and fully trackable. To wit: } In 2014, companies spent an average of 25% of their marketing budgets on digital products } By 2019, that number is expected to jump to 75% Despite those statistics, direct mail marketing remains one of the most effective means of lead generation. You know this to be true, but here are some stats: } 40% of consumers have made a purchase in the last three months because of direct mail } 92% of Millennials have been influenced to make a purchase because of direct mail } 48% of consumers hold on to direct mail for future reference So how can you take your product — direct mail — and turn it into something that delivers on what today's savvy business owner wants?

With three simple direct mail add-ons that increase the value of your clients’ campaigns: mail tracking, call tracking, and Google ad integration. For one large commercial printer, adding these services to their clients’ direct mail campaigns tacked an extra $1.2 million on to their revenue in just 12 months. And that $1.2 million was JUST from these upsell products alone! That’s on top of traditional direct mail campaigns. Here’s how these services can enhance your current direct mail products to create a trackable and fully integrated campaign: Mail tracking to gauge and prepare for delivery You can add a custom barcode to your client’s mail piece that will allow them to track it as it progresses through the USPS system. They can check its progress online, with updates on its expected delivery date and notification when it is actually delivered. This helps them prepare for a flood of calls to their business! Call tracking to measure calls coming in from each mailing Your client is assigned a dedicated call tracking number that rings directly into their business phone. They don’t have to change their main number or do a single thing; the prospect dials a special number printed on the mail piece and it rings in the business directly, but every call is tracked and recorded in the cloud as it comes in. With call tracking software, your clients can see with an online dashboard exactly how many calls are generated from their campaign and even listen to the calls.

This helps them track results. They can see how well their direct mail campaigns are performing and quality-check their reception process and their sales people’s pitches so they can make improvements if needed. Google ad integration for amplified reach and exposure You can embed a pixel (an unobtrusive piece of coding) on your client’s website that “cookies” visitors. Then, when those visitors leave without converting, they see your client’s follow-up ads on websites all across the Google network. I’m sure you’ve experienced this yourself, especially on shopping sites — you are interested in a product but don’t buy, and then you see the ad everywhere. This is known as “retargeting” or “remarketing,” and here’s why it’s so powerful: Once your client’s direct mail is delivered, the majority of interested recipients will go online for more information — but studies show that 96% of those people are not quite ready to become customers. When they see your client’s ad again and again online, they are reminded of their initial interest and are more likely to become customers! Look at these numbers: } Google follow-up ads can boost ad response up to 400% } Web visitors who are retargeted are 70% more likely to convert Adding these components to your clients’ direct mail marketing exponentially improves their results — and when they get better results, they reorder from you more often! ¾

Joy Gendusa is the Founder and CEO of DirectMail2.0, a fully integrated marketing solution for the clients of printers/mailers that combines the proven success of direct mail with in-demand features like online advertising and automated campaign tracking. You can schedule a free demo to see how a partnership with DirectMail2.0 can boost revenue and improve your clients’ response and ROI. Visit www.directmail2point0.com or call 800.956.4129.

MailingSystemsTechnology.com | SEPTEMBER-OCTOBER 2016

THE TRENCHES

By Mike Porter

SMALL DATA CAN MAKE YOU A BIG SUCCESS

ig Data is a popular topic. The term means different things to different groups, however. For some, the operative term is “Big.” They are looking at the volume of collected data, either in total or connected to a single individual. At some point, the volume is enough to earn the Big Data designation. Others perceive Big Data in terms of the breadth of collected material. The number of data sources providing bits of information is the important part for them. IT people may regard the complexity of relationships between different pieces of data as the relevant measurement. And high-thinking scholars might discuss how the data is used or what it tells us about an individual, group, or society as the characteristic that defines Big Data. I study customer communications. My thoughts about Big Data are pretty uncomplicated compared to those popular definitions, the reason being the customer communications business has been using techniques resembling Big Data for a long time. We’ve used names such as segmentation, target marketing, or variable data printing. Critics may point out those methods lack the precision normally associated with Big Data. They are right. Mailing an offer to thousands of consumers in a certain age group or income bracket isn’t the same as analyzing web behavior, social profiles, and psychographic information to separate people likely to buy black socks from those who prefer white. Maybe we don’t need all that data, though, to be better at how we interact with customers via the documents we produce.

I’m all for using information gathered from across the enterprise to craft messages representative of individual customer relationships. There might be a point, however, of declining benefits. Big Data will make a noticeable difference in some situations. In others, the impact of deep customer analytics may be negligible. Small Data Makes a Big Difference In many cases, Small Data can make a big difference. Much of the marketing mail produced by corporations today can improve by applying a bit of extra data and logic. Varying a message to account for recent customer purchase activity, for example, would prevent organizations from offering introductory prices to ineligible customers. We’re not talking about Amazon-style predictive analytics here, just basic true/false logic that could reduce wasted efforts and improve customer experiences. What about varying an offer sent to customers of brick and mortar businesses based on the travel distance from prospects' homes? Again, not too hard — geolocation software can provide the distance information based on data already present in the mailing file. Document composition programs or intelligent inserters can easily handle the variable message production and distribution. Attracting more customers from greater distances while simultaneously lessening the revenue impact of coupons provided to nearby patrons is great for campaign ROI. Are those examples of Big Data? You can decide for yourself. I’m not convinced

it really matters so long as applying the data results in more effective communications. Could more targeted, personalized, and relevant customer communications be produced by analyzing more data? Sure! Will the returns be worth the investment in outside databases, data analysis professionals, and intricately designed document logic? It depends. The Ultimate in Customer Communications The greatest return on Big Data might be its effect upon customer experiences. Making each customer feel important and appreciated is a goal identified by many companies. Understanding a customer’s complete relationship with an organization, however, requires collecting data about two-way communications across all channels. Transactional and historical data must also be considered. That is a tall order for most large corporations. They may have the data, but it is not normalized or centralized. Making customer communication decisions based on an ideal 360-degree customer view is a worthy ambition, but not likely to happen without an enterprise-wide data restructuring initiative. That may occur someday. For now, customer communications professionals can dip their toes into the Big Data pool, choose data that will make individual messaging better, and use it intelligently. Big Data may be the ultimate objective, but there’s plenty of benefit from optimizing Small Data today. ¾

Mike Porter is President of Print/Mail Consultants, a firm that helps companies lower costs, develop future strategies, and improve quality in their document operations. You are invited to visit www.printmailconsultants.com and sign up for Practical Stuff, a free newsletter for document print and mail professionals.

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

APPLICATION ARTICLE

Optimize Your Sorting Operations NPI Sorting systems are designed to optimize your sorting operations with advanced design and intelligent software. Built around patented anti-jam technology, the sorters run more economically as time-wasting jams are virtually eliminated. Multiple motors precisely located throughout the sorter, instead of a single motor power transmission system, drastically reduce maintenance costs and power consumption. Modular ergonomic design promotes seamless upgrades and modifications to support your expanding operations and improve production efficiency. NPI Sorting Systems provide solutions for products ranging from postcards, letters, flats, and even small to large parcels. The NPI Catalog of Sorting Systems represents some of the most innovative, advanced and fastest Sorting Systems on the market, but Sorting Systems are only half of the equation. NPI Software Suites are as versatile and innovative as sorters. Through the advent of Intelligent Mail and the universal Mail. dat format, efficient data management is now the key to sort optimization, enhanced qualification and postage savings. NPI’s OptESuite of software products allows our customers to predetermine sort plans, identify what levels of qualification

is best for their operation and understand what it takes to maximize postage savings before a mail piece even hits the sorter. This allows customers in the Printing Industry and Large Standard mailers to realize real savings through commingling and co-palletization. The same technology also allows Service Bureaus to analyze different mail streams to determine the most profitable mail streams to commingle. In today’s mailing world, you can’t afford to be second. If you want your operation to be as efficient, profitable and successful as it can be, you need to contact NPI. We will analyze your operation and offer real solutions to help you be first.

888.821.7678 michelle@nationalpresort.com www.npisorters.com

STOP BY BOOTH 1161 AT GRAPH EXPO

WHAT TO SEE AT GRAPH EXPO: PRODUCT SPOTLIGHTS

Full Color Refresh

90 OOTH 0

Neopost has what it takes to make your direct mail stand out from the rest. We will be featuring our best digital print solutions and addressing products — and even a surprise product is making its debut! Each machine is helping your business boost its profitability in its own unique way. Neopost 610.650.9170 w.longua@neopost.com www.neopostusa.com

SITMA is a leader in the design and manufacturing of poly-wrapping, paper-wrapping, envelope inserting, packaging and distribution systems for the graphic arts industry. Our uniquely reliable and modular solutions are designed to process applications in high-speed production environments. We welcome any opportunity to solve your most challenging jobs. SITMA USA, Inc 651.222.2324 800.728.1254 sitma@sitma.com www.sitma.com

Integration + Technology = Integratec

PEOPLE MOVING IDEAS

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Opte-mizing Mailing Analytics

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BCC Software unveils a new era in postal presort technology with the launch of the Integratec API Platform. PAVE™ certified and built using ZeroMQ™ messaging with the CurveZMQ protocol, Integratec is the only presort API available with both top security protocols and postal certification. A 2016 “Must See ‘Ems” award winner!

Optesort is a suite of software products by NPI designed to efficiently analyze and minimize mailers’ finalized cost for First Class and Standard mailings. The Suite offers the ability to quickly perform what-if analysis of various mail streams in order to increase Presort Discounts as well as optimize Drop ship discounts.

BCC Software 800.453.3130 www.bccsoftware.com

NPI 888.821.SORT (7678) www.npisorters.com

Validate, Print, Send & Track

23 OOTH 84

Our customer-centered solutions simplify your workflow management. We provide you with money-saving results for address correction, postal presorting, mail tracking, and print workflow automation in the United States and Canada. SmartSoft Inc 888.227.7221 contact@smartsoftusa.com www.smartsoftusa.com

1 Million Envelopes and Counting!

94 OOTH 1

Purchase the iJetColor Press and become one of the business owners that have printed more than 1,000,000 envelopes at rates even lower than originally expected. Today, iJetColor Press users are experiencing long-term profitability and short-term ROI. Powered by Memjet technology, let the iJetColor Press revolutionize your print and mailing operations. Printware 800.456.1400 sales@printwarellc.com www.ijetcolor.com

New For 2016!

16 OOT 61 H

This year at Graph Expo, MCS will showcase the CA 1030 Card Attaching System with Osprey inkjet. This system is designed for attaching plastic or paper cards to carriers at high speeds. Plus, a new color envelope printer with PDF digital workflow running in-line with ultra-high-speed inserting. MCS 800.728.0154 glenn.toole@mcspro.com www.mcspro.com

Nothing Is Built Like a Kirk-Rudy

SAP® DATA SERVICES

74 H

SAP DATA SERVICES is SAP’s premier global data quality platform built on 30 years of proven data quality technology including: DATA PROFILING — data analysis, ADDRESS CLEANSE — CASS™, NCOALink® & DSF2® ready, global address cleansing & geocoding, DATA CLEANSE — data standardization, MATCH — deduplication & householding. ETL for structured & unstructured data. Available “On-Premise” on Windows, Linux, Solaris & AIX platforms. Firstlogic Solutions, LLC 888.725.7800 www.firstlogicsolutions.com

17 OOT 71 H

Ink Solutions Provider!

15 OOTH 75

Kirk-Rudy will be featuring a large sampling of their quality, built-to-last equipment. Along with their famous tabbers and card attaching systems, five different inkjet systems will be operating on the show floor. For 49 years, Kirk-Rudy has been the leader in quality and innovation, building systems from the ground up in their factory in Woodstock, GA.

Think Ink is one of the largest OEM partners of both Hewlett-Packard and Collins Inkjet, as well as a supplier of FlexPrint brand inks. FlexPrint inks are specifically formulated for challenging applications. Think Ink is your ink solutions provider, and we have the industry’s best and largest inventory!

Kirk-Rudy, Inc. 770.427.4203 info@kirkrudy.com www.kirkrudy.com

THINK INK 877.857.2459 david.ham@thinkink.com www.thinkink.com

1 OO Matching, Sequence Checking, 67 TH 4

1 OO Don’t Sweat Your Scorecard 377TH

From the lowest price visual match system to the automated OCR/Barcode match system, to our latest Read & Print system, we have a solution for you. All of our Picture Perfect Match System products are modular, so you only buy what you need today but have the flexibility to upgrade tomorrow.

Is your Mailer Scorecard in top shape? If your operation uses BCC Software’s wide range of products and data marketing service options, you can rest easy. Talk to our certified mailing professionals and learn which service or combination is right for the type of mailings your business executes.

Clear Image Technologies larry@clearimagetechnologies.com 314.853.5867 www.clearimagetechnologies.com

BCC Software 800.453.3130 www.bccsoftware.com

Verification, Read & Print…

WHAT TO SEE AT GRAPH EXPO: PRODUCT SPOTLIGHTS

FIRSTLOGIC® DATA QUALITY WORKFLOW

12 OOT 74 H

ZERO TOUCH DIRECT MAIL CONVERTING!

25 OOT 49 H

FIRSTLOGIC® DQ WORKFLOW™ is an automated “lights out” mailing software solution using a graphical “drag & drop” user interface to build custom workflows with standard functions to expedite both US & INTERNATIONAL mailing processes. Firstlogic DQ Workflow provides USPS® CASS™, NCOALink® and DSF2® address cleansing and PAVE® Gold mail presorting and tracking with precision, performance, and productivity.

8 Processes in one system with just one operator? Correct.

Firstlogic Solutions, LLC 888.725.7800 www.firstlogicsolutions.com

Rollem 800.272.4381 www.rollemusa.com/mail

Make Card Attaching Profitable!

12 OOT 61 H

Are you still trying to manually attach cards on your mailings or using problematic systems that experience more downtime than uptime? Let the all-new AT-Series Card Attacher generate profit to your bottom line. Thiele Technologies’ Feeder Business Unit, featuring the Streamfeeder and Sure-Feed Product Lines, introduces the all-new AT-Series Card Attacher.

BCC Software 800.453.3130 www.bccsoftware.com

16 OOT 82 H

Find out what the buzz is all about. Satori IGNITE is the latest breakthrough in workflow optimization. Reduce your data processing time by at least 90% and increase capacity and productivity. Expand your offerings and get better contact data with our expanded data services offerings, including phone and email append, and email validation. Learn more at Graph Expo. Satori Software 800.553.6477 sales@satorisoftware.com www.satorisoftware.com

Get with the Pros

13 OOT 77 H

Working with a support team of USPS-certified mailpiece design professionals like the team at BCC Software gives you the confidence to grow your business. When direct mail is dependable and returns actionable data, it is better and more often used in a marketing mix.

Streamfeeder & Sure-Feed, by Thiele Technologies John Curie 763.502.0000 www.surefeed.com www.streamfeeder.com

New Solutions to Expand Your Business

Mailstream II offers high profit potential for mail finishing with its compact footprint, low cost basis, and multitude of functions. Bi-directionally trim, slit, score, and perforate, card tipping, remoistenable glue, folding, and glue closures are all completed in one pass. Each system can be customized to meet specific applications and needs.

Right Content, Right Recipient

90 OOTH 0

Enhance the security of your outbound communications with Neopost USA’s new “Process Integrity Solution.” Neopost USA’s new intelligent folder/inserters, combined with its new OMS-500 browser-based output management software, create a complete and secure mail preparation platform that ensures the right documents are sent to the right customer. Neopost USA 1.800.NEOPOST 1.800.636.7678 neomkt@neopost.com www.neopostusa.com

Optimize Campaigns With Mailpiece Tracking

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According to a 2016 report, the slower growth of the global economy creates opportunities for businesses that innovate and increase efficiency. With products like BCC Software’s Track N Trace, marketers can create multi-touch campaigns from mailpiece data and get more value from direct mail. BCC Software 800.453.3130 www.bccsoftware.com

MORE PRODUCT SPOTLIGHTS

Disruptive Mailing Portal Breakthrough Drag-&-drop mails one or thousands. At will, self-serve. Fully automated, immediate feedback. No templates, windows, cover sheets, equipment or paper needed. Hard copy mail designed your way. FC, Std, NP – singles, batches, promotional – mixed media, envelope art. Addresses certified, Imb outer and reply. Elegantly simple. “Stunningly comprehensive. -P.F.” Postalocity 316.262.3333 www.Postalocity.com

Use Video in Print for Discounts Improve the overall value of printed mail by using video in print. Enjoy higher revenue growth and additional postage discounts with the USPS® video-in-print promotion. Find out how you can leverage your direct mail efforts to facilitate online customer engagement with personalized, viewer-driven, real-time experiences using EngageOne® Video. Visit pitneybowes.com/us/video-in-print. Pitney Bowes Digital Commerce Solutions 800.327.8627 pbsoftware.sales@pb.com www.pitneybowes.com/us/video-in-print

A LOOK AT OUR INDUSTRY

It is once again time to look at the results of our annual survey, where we report on wages, staff sizes, mail volumes, and more.

By Amanda Armendariz

s is the case with most industry surveys, this year’s results show both some promising statistics and some not-so-great news. On the downside, the average hourly wages are down for addressing machine operators, inserter operators, and mail handlers. Some of these decreases are quite dramatic — over a dollar or two down from last year. The average wages have been creeping up consistently over the past couple of years, so to see that graph go down is rather disheartening. On the bright side, the average highest hourly wage has increased quite a bit, which suggests that companies are rewarding those employees who stick with them. And even more encouraging for our industry as a whole is the fact that the average monthly outgoing mail volume in two categories (500,000-999,999 and one million-plus) skyrocketed compared to last year. In 2015, for example, the number

of respondents who reported sending out between half a million and a million pieces per month was 5.36%. This year, it’s 13.73%! And the numbers for the one million-plus group tell a similar story. After years of seeing mail volumes go down, it’s reassuring to see that numbers for these two largest groups are soaring. Maybe everyone is finally coming to accept what we have known for a long time — mail does work, it’s trusted by customers, and there are ways to integrate with digital channels, rather than compete against them. I hope that next year’s results will tell the same (or even better) story! As always, I’d like to extend a huge “thank you” to those readers who took the time to fill out our survey. Your input helps us give a much-respected look at the industry year after year, and we appreciate you sharing this information with us!

Mail Center Managers Male vs. Female

45%

How Many FTEs Do Mail Managers Supervise?

55%

0-5

16-20

6-10

20+

12.16%

1.35%

8.11% 56.76% 21.62%

11-15 This is relatively close to last year’s percentages, when 47% of mail center managers were female, and 53% were male.

Average Salary

According to our respondents, the average salary for a mail center manager is $57,057, which is down slightly from last year’s average of $58,203.

$57,057 20

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

Like last year, the majority of mail center managers are responsible for a relatively small number of employees. But unlike last year, the number of managers responsible for managing either six to 10 or 11-15 employees went up substantially, while the number responsible for 16-20 employees has decreased dramatically. Perhaps this is a sign that with continued economic recovery, managers are not being stretched as thin and are no longer forced to take on more responsibilities/supervisees than makes sense. The fact that only 27% report that mail center managers are required to take on additional responsibilities appears to back this assertion up, especially compared to 2012 and 2013, when the number of managers required to take on extra duties was 62% and 59%, respectively.

They Know Their Stuff

On average, the mail center manager has spent 16.65 years in the mailing industry. However, this is a decrease of almost two years compared to 2015, when the average time spent in the industry was 18.5. As more and more baby boomers are retiring, I have a feeling we’ll continue to see this number go down.

The Economy

When asked if the economy has had an effect on mail center managers’ positions, our respondents answered as follows.

60 50

Last year, only 37% of respondents reported that the economy had no effect on their mail center managers, so that 50% is a great sign this year!

50%

Number of mail center managers who hold the following certifications

10%

30 27.03%

18.92%

16.22%

CMDSM

6.76%

15%

EMCMP

CMM

1.35% 4.05%

Has had no effect

Salary freeze

Took on additional responsibilities

Working additional hours

Other

Number of mail managers decreased

Salary concession

While these numbers are indeed up compared to our 2014 survey, they are down a few percentage points in all categories compared to 2015. Last year, for example, 19.4% of mail center managers held the EMCMP certification, compared to only 15% this year. I know budgets can be tight, but continuing education and certifications are some of the best ways to ensure you have a mail center manager that will help your mailing operation succeed.

Continuing Education

It’s great to see so many mailers engaged in their local PCC communities and attending NPF! It is concerning, though, that almost 25% of respondents said there was no time, budget, or approval for training.

For those mail center managers who sought out continuing education opportunities, here are some of the most popular ways they chose to stay engaged.

40 37.84%

21.62% 17.57%

16.22% 16.22% 12.16%

9.46%

6.76%

8.11%

13.51%

4.05%

Local PCC conferences/meetings

MAILCOM

Vendor’s user conference

National mailing “schools”

Other non-mailing national conferences (i.e., management training courses)

NACUMS, Non-profit, DMA)

10.81%

2.7%

National Postal Forum (NPF)

National industry or association-specific mailing conference (MSFA,

9.46%

8.11%

Other non-mailing local conferences Online continuing education classes

On-site continuing education classes None, due to budget cut backs None, didn’t find the time to attend

None, training is not allowed for supervisors None, no training needed this year Other

MailingSystemsTechnology.com | SEPTEMBER-OCTOBER 2016

Supervisors Fifty-nine percent of mail centers had supervisors, compared to 41% without. This is a substantial increase from last year, when only 45% of our respondents reported having supervisors in their mail center. Sixty-five percent of the supervisors this year are male, compared to 35% female. On average, the supervisors held the following certifications. The numbers for EMCMP are up compared to last year, but the other two certifications are down a couple of percentage points.

13%

EMCMP

CMDSM

Supervisors and the Economy 50 40

42.86%

30 25%

CMM

17.86%

10.71%

10.71% 7.14%

Supervisor Vitals } The average salary for a mail center supervisor is $49,480, up slightly from last year’s $48,402.

Has had no effect

Salary freeze

} On average, they supervise nine employees.

Took on additional responsibilities

Working additional hours

} The average tenure in the mailing industry is 13 years.

Number of mail supervisors decreased

Salary concession

} Seventy-nine percent are not responsible for other departments or functions.

Continuing Education

60 53.57%

50 40 30

As the editor of a media that strives to be the top industry resource for mailers, I am naturally thrilled that over half of the supervisors who engaged in continuing education this year chose to do so through their local PCCs. PCCs are a fantastic resource (I attend the meetings in the Madison area from time to time) and a wonderful way to connect and learn from fellow mailers. I’m so glad to see this option utilized. And the fact that even more supervisors than mail center managers utilize this option attests to its importance!

21.43% 17.86%

14.29% 14.29%

14.29%

10.71%

10.71% 7.14%

3.57%

National Postal Forum (NPF)

Local PCC conferences/meetings

MAILCOM

Vendor’s user conference

National mailing “schools”

Other non-mailing national conferences (i.e., management training courses)

National industry or associationspecific mailing conference (MSFA, NACUMS, Non-profit, DMA) 22

3.57%

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

Other non-mailing local conferences

None, due to budget cutbacks

Online continuing education classes

None, didn’t find the time to attend

On-site continuing education classes

None, training is not allowed for supervisors

Staff The gender breakdown in staff members is relatively equal, with 48% female and 52% male. On average, mail center staff have been in the industry for 9.75 years. The average mail center, according to respondents, has a turnover rate of just under 10%. Over 92% are not represented by a union, and only 21% have employee incentive programs.

Percentage of mail processed as

9.5%

First-Class Mail Periodicals

29%

52%

Standard

Average Wages of Mail Center Staff

Parcels

9.5%

Average Monthly Outgoing Mail Volume 29.41% 2014 - $12.26

2015 - $15.38

2016 - $13.64

2014 - $12.48

2015 - $15.62

2016 - $14.72

2014 - $12.43

2015 - $15.34

2016 - $14.36

2014 - $15.97

2015 - $18.33

2016 - $19.60

2014 - $11.20

2015 - $12.60

2016 - $12.34

0 Entry-level

Addressing machine operators

Highest hourly wage

Inserter operators

19.61%

Less than 50,000 13.73%

50,000-299,999 300,000-499,999

5.88%

500,000-999,999

31.37%

1 million or more

Mail handlers

Average Incoming Mail Volume

Staff and the Economy 50

10%

< 5,000 48.08%

5,000-19,999

14%

50% 10%

20,000-49,999 16%

50,000-74,999

75,000 or more

20 19.23%

9.62%

11.54%

9.62%

1.92%

Has had no effect

Existing staff work additional hours

Salary concession

Existing staff do additional tasks

Salary freeze

Other

Layoffs

Number of Company Employees Fewer than 10

13.73%

43.14%

21.57%

10-99 100-500 500 or more

21.57%

MailingSystemsTechnology.com | SEPTEMBER-OCTOBER 2016

By Gina Ferrara

OUTSOURCING PRINT â&#x20AC;&#x201D; SMOOTH SAILING OR STORMY SEAS?

etermining whether to shut down your internal print and mail operation and outsource to a print service provider, as opposed to keeping it in-house and potentially making a capital investment in new technology, can be a tough conversation. Those in favor of the latter option will cite concerns over sending customer data outside the organization and advocate that investing in new technology will improve operational workflows, enhance the customer experience, and increase brand recognition by adding color to documents, as well as potentially generate a better return on investment for the organization. Proponents of outsourcing believe that print is not a core competency and argue that outsourcing to a service provider would be the less expensive alternative. While there may be a variety of reasons that cause an organization to consid-

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

er closing up shop, there are a few factors that, when considered together, can create the perfect storm. 1. Decline in transactional print volumes Electronic delivery of customer communications was a high priority for many organizations as a cost reduction strategy. While adoption rates may have varied, electronic delivery nonetheless caused transactional print volume to decline, even causing some enterprises to consolidate production into one site. Print volumes decline, unit costs go up, and outsourcing becomes more financially attractive. 2. Equipment has reached end of life or end of lease Enterprises in need of a technology refresh may not be willing to make the investment or be able to justify the expense. New

technology can speed production, streamline operations, enhance documents with color capability, and reduce risk; however, if priorities have changed and the customer communications management strategy has shifted toward enhancing the digital experience, convincing management to invest in print technology may be a tough hurdle to overcome. 3. Limited or no color capabilities Some in-plants can only produce output in monochrome or have very limited color capability. With the demand for color increasing, internal lines of business may look to an outside vendor to meet their requirements for color, and corporate marketing may have already beat them to it. From a financial perspective, this is a double whammy. Outsourcing a subset of documents to a third-party provider decreases the volume

factory controls and tracking capabilities for each mail piece throughout the entire manufacturing process is critical to ensure correct and complete packages. 5. Single site operations must rely on third-party providers for disaster recovery and business resumption services If an enterprise operates one site, or has consolidated sites due to decreased volume, then disaster recovery and business continuity services must be contracted with a third party. Acquisition of facilities due to a corporate merger may not always provide the ability to transition print files from one site to the other if software, equipment, and infrastructure differ. Worse yet, sometimes older equipment gained by acquisition must be kept due to machine-specific print jobs.

for the in-plant facility and further exacerbates the impact on unit cost. In addition, outsourcing low volume to a third party can be costly for two reasons: higher unit costs from no economies of scale and additional conversion costs if the organization decides to consolidate all print volume with a single service provider in the future. 4. Increased regulatory pressures require full document integrity Non-compliance with regulations such as Gramm–Leach–Bliley, SSAE 16 (formerly SAS 70), and HIPAA, can be costly from a financial and reputational risk perspective. Production issues such as double stuffs or incorrect document breaks create privacy issues with personally identifiable information (PII). Organizations must take the appropriate measures to ensure that sensitive data is secure. Software that provides

6. Change in management philosophy Even without the previous five factors, sometimes a change in senior management philosophy might be the one driver for the decision to outsource. C-level management may believe that print and mail is not a core competency of the overall business and, thus, should be outsourced to a service provider. While it makes sense to consider outsourcing if print volumes have been on the downward slope, there is no magic number or volume threshold that dictates the exact time to do so. Understanding the benefits that can be obtained by outsourcing may help to reduce anxiety and clear up the stormy skies clouding the decision process. To start, no capital investment in new equipment is required. Unlike an in-plant operation, service providers have the ability to spread the cost of capital across multiple clients and have made the investment in color technology. Due to greater economies of scale, service providers have great buying power for consumables, such as ink, paper, and envelopes. In addition, a reduction in postage expense could be realized if postal densities for five-digit and three-digit rates are met. To remain compliant with certain regulations, service providers must have strict production controls and data security procedures to ensure that sensitive data is protected. File-based tracking tools ensure that files are received on time and that record counts are accurate, while piece-level or page-level tracking ensures that each mail package is correct and complete. Detailed production reports with key performance indicators (KPIs) are available via a dashboard that allows clients to log in, view production job status and

service-level agreements (SLAs), request document pulls or re-directs, and even create customized reports. To facilitate testing, quality reviews can be performed prior to releasing files into production via a review and release capability. Once the decision to outsource has been made, it is time to set sail and begin the journey. Since price will most likely be a significant factor in vendor selection, here are a few tips that should be kept top of mind. 1. Create a complete inventory of all printed communications to be included in the request for proposal (RFP). Consolidating all print — what is produced internally or by external vendors — with a single provider is the best way to maximize volume pricing. 2. Understand what is included in transition costs, which can vary significantly by provider. To secure a contract award, some may include a certain number of free hours of development time as part of the transition cost. 3. Standardizing address location on documents eliminates the need for multiple types of envelopes, streamlines the manufacturing process, allows for jobs to be concatenated together, and helps to keep production costs down. 4. Review SLAs for all applications to determine if there is flexibility. 5. Contract duration will typically impact price; therefore, annual pricing quoted in a five-year contract will be less than a three-year contract. Deciding whether or not to outsource print requires consideration of a variety of factors, but with a detailed analysis of the pros and cons of both options, an informed decision can be arrived at more easily. Many organizations fear losing control since the print shop is no longer within arm’s length, but the security, output quality, and efficient manufacturing controls implemented by top-tier service providers should help to alleviate that fear. No transition is perfect — but the technology, processes, and depth of knowledge offered by a print service provider will ensure smooth sailing. ¾

GINA FERRARA is senior analyst at Madison Advisors, an independent analyst firm which specializes in offering Fortune 1000 companies context-specific guidance for a range of content delivery strategies, particularly those addressing enterprise output technologies and customer communications. Visit Madison Advisors at www.madison-advisors.com. MailingSystemsTechnology.com | SEPTEMBER-OCTOBER 2016

By Dave Lewis

BUILDING A WINNING MULTI-CHANNEL CAMPAIGN: PART TWO Tips to creating a campaign that succeeds

n part one of this series, which ran in the July/August issue, we made the case for adding new channels to your direct mail, thereby, turning a mailing into a campaign. Now we’ll discuss the process of building that campaign. First, Back to Direct Marketing 101 We have all too often found the mail piece itself to be missing something critical: an offer. Direct mail needs an offer — it needs a reason to respond. “We’re the best printer/ mailer in town!” is not an offer, even if you

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

ARE the best printer/mailer in town. “We’re the best printer/mailer in town, AND we’ll give you a $10 Starbucks gift card to prove it,” is an offer. Now you have offered your prospect a tangible reason to respond. We’ve seen many different offers work — from simple bribes like a gift card or a chance to win a drawing, to coupons or special deals, to more intangible offers like a white paper or a free mailing practices analysis. Any of these can work in a compelling campaign. Test different offers — see what works for your prospects.

If I had to come up with a list, I’d say the following are the attributes of the best offers we’ve seen: } They are relevant to the prospect. Remember, the prospect is always a person, not a company. Make it relevant to that person — they are your entrée to the company. } They have perceived value. “Ten percent or $100 off of your next mailing” is a weak offer if you do not have published pricing. } They convey a sense of urgency. Offers shouldn’t last forever — if your

prospects don’t respond now, they probably never will. } They are obvious. Don’t be humble and bury that offer in the text. Your campaign is about that offer! For every campaign you do, always ask yourself, “What is our offer?” It’s not hard to do, but it’s easy to forget. OK, I Like Your Offer. Now What? The call to action is a concept so important to direct marketing, it is conveyed in initials: CTA. The CTA is a simple but important concept — it is the action your prospect needs to take in order to respond to your offer. For example, “Call 1-800-MySnail,” “Go to www.BigOffer.com,” or “Click here!” As basic as the CTA is, many marketing pieces force you to hunt for how to respond. One needs to “send an email to info@buythisthing.com” or they have no call to action at all. Crafting a CTA really just requires that you put yourself in your customer’s place and walk through the buying process. Giving Your Prospects a Place to Go — Your Landing Page The landing page, a simplified webpage where your prospects can complete their response, is really the heart of any campaign. Whatever marketing channels you use, from postcards, to web display ads, to billboards, they should all point to your landing page. Your landing page will generally be simpler than your company homepage. Its primary mission is to get your prospects to convert — to push the button and respond to your offer. The page may have the general look and feel of your homepage or your marketing assets, but its function should be simple and clear. In most cases, your landing page should have its own URL (web address) unique to the offer. You’re not trying to get prospects to your homepage — you’re trying to get them to buy. When you combine a few short words, it’s easy to create compelling and memorable URLs, like GreatNewCatFood.com, Your-Profits.com, or PerfectHeadPhones. com. Easy to type and remember. If you use personalized URLs, you can personalize the landing page and have custom graphics appear based on who the prospect is. Essentially, anything you can customize on a direct mail reply form can be customized on the landing page — graphics, contribution ask amounts, text, and more.

The primary mission of the landing page is conversion — you want your prospect to accept your offer, so once again, you need a powerful CTA. Your landing page should have a clear button, and it should look like a button. Don’t make your prospect guess how to respond. Test different calls to action to see what works best for your campaigns. Using All of the Channels to Drive Them to Your Landing Page Once you have an offer and a web landing page where your prospects can respond to that offer, your mission is to lead them there — this is where all of the channels in “multi-channel” go to work. For each channel, you need to consider your CTA for that channel, as well as the links you will provide to your landing page. You should also be considering how all of your channels can be coordinated so you leverage the strengths of each channel. Direct Mail Of course, your mail piece (or pieces) is the driver of the campaign. In creating the piece, remember that it should feature your offer and a strong call to action. Make sure it’s easy to know why and how to respond. Include a prominent link to your landing page, and, if possible, provide a PURL — a personalized URL. If your prospect types it in, it becomes easier to customize the landing page to them. More importantly, you will be able to better track their visits to your landing page so you can follow up. You also want to be certain to track your direct mail. It’s easy and affordable with Intelligent Mail barcodes, and there are many services that can help you with that. Knowing when mail is delivered is an essential ingredient in coordinating your other channels. Email Marketing In terms of sheer volume, email marketing is the biggest direct mail channel today. Can you say “spam?” Yes, there is a lot of truly junky email out there, but properly done as part of a coordinated campaign, email can be a valuable channel. It is often an affordable way to keep alive a campaign that began with direct mail. Generally most effective with customer or house lists, we often “trigger” a follow-up email based on when the direct mail piece is delivered. Thus, not every email goes at once; they release as the mail is delivered. For a coordinated campaign, we prefer an email design that reflects the design of the

mail piece. This is another opportunity to deliver your offer to your prospect. Too often, direct mail pieces create interest that fades when the prospect moves on to something else. A triggered email is another chance for them to respond. As with the mail piece, make sure the offer is prominent and front and center. Make the CTA obvious: “click here to reply.” Links in email can also be easily personalized — make sure you know who is clicking, and take advantage of that knowledge when they reach your landing page. Web Display and Social Media The technology of web and social media advertising has changed in recent years to make it a much better fit with a direct mail-driven campaign. Gone are the days of buying a position on a website. Instead, you can use IP targeting to match your mailing list against home IP addresses — the electronic addresses of your prospects’ computers — and have web display ads appear on major websites as they surf the web. Not to be outdone, Facebook can place ads based on your prospects’ email addresses in their news feed — and identify other look-alikes on Facebook to increase your reach. None of these match at 100%, but they all increase both your prospects’ awareness of your brand and offer and their response to the campaign. Measure and Repeat All of these methods produce measurable results, but only if you measure them. Too many marketers today send mail without a strong means of tracking results. If it works well, they tend to do the same thing all over again — including the less effective channels. If it doesn’t work, the conclusion is too often: “Direct mail doesn’t work, or at least all of these other gimmicks don’t.” You’re Already Multi-Channel — Now Get Coordinated! Virtually every company is using a variety of marketing channels today. Some are more effective than others, but virtually any direct channel can be made more effective by strengthening it with another channel. Build a strong offer and a clear call to action. Create a strong landing page where your offer can live, and drive your prospects there with a coordinated, measured effort. Chances are good you’ll be rewarded for your efforts — over and over again! ¾

DAVE LEWIS is President of SnailWorks, LLC and can be reached at dlewis@snailworks.com. MailingSystemsTechnology.com | SEPTEMBER-OCTOBER 2016

DEMYSTIFYING

UAA MAIL

WHERE DOES IT COME FROM, AND HOW DO YOU FIX IT?

HE PROBLEM. Weâ&#x20AC;&#x2122;ve all seen it: trays and bins of mail with those bright yellow stickers returned to our office. Itâ&#x20AC;&#x2122;s embarrassing as management seeks to answer why the organization is getting so much returned mail. The USPS defines Undeliverable as addressed (UAA) mail as all mail that cannot be delivered to the name and address specified on the mail piece and must be forwarded, returned, or treated as waste as 28

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authorized for the class of mail and ancillary service endorsement on the mail piece. It may be due to individual, family, or business moves, incomplete or incorrect addresses, unknown or deceased addresses, lack of a delivery receptacle, refusal by the recipient, or lack of sufficient postage. In 2015, the USPS handled almost 6.5 billion pieces of UAA mail, forwarding 994 million pieces, treating four billion pieces as waste, and returning 1.4 billion pieces

that alone cost the USPS $788 million. Even though mail volume is decreasing, UAA mail remains a significant problem. For mailers, this also means wasted costs (industry estimates are one to three dollars per piece in operational costs), including lost and delayed revenue, reduced customer satisfaction and marketing opportunities, and lost customers. Why is so much mail undeliverable? The primary reason is that over 75% of the

By Gary A. Seitz

recipients no longer receive mail at the address — simply, they’ve moved. Another 12.5% have missing or incorrect address elements (usually a secondary address like apartment/suite number), and another eight percent are destined to vacant addresses. The USPS has found that of the 75% of UAA mail that is related to “move updates,” 60% have moved within the prior three months. In most cases, this can simply be due to the amount of time between when mailers select names from their customer databases and when the mail is prepared and delivery is attempted to the address on file. BASIC SOLUTIONS. The USPS promotes the “3 Cs” for effective address hygiene: correct, complete, and current. For correct addresses, it all begins at the point of capture. Modifying entry screens (including your website) and implementing training procedures on collecting and entering proper addresses (we’re proponents of USPS Pub 28) is a start. Apply CASS and LACS updates to your file at least quarterly. CASS/DPV validates the specific accuracy of ZIP Codes, street names, house numbers, and secondary addresses. Then identify records that do not match up with CASS/DPV for correction. A few tools for address correction are reviewed later in this article. LACS updates addresses that changed due to local community address conversions or 9-1-1 implementation in rural areas. These include both street name changes and address renumbering (yes, your house can actually be renumbered!). Complete addresses include SuiteLink and Apartment Append. Adding or correcting missing secondary address information improves NCOA matching, duplicate elimination, and address delivery. SuiteLink is available during CASS processing, and many service providers offer Apartment Append. Keep addresses current by utilizing NCOA (either 18-month or 48-month), and periodically utilize ancillary service endorsements and the ACS program (we recommend at least twice each year). We highly recommend mailers utilize NCOA

quarterly on their master files and immediately prior to any mailing. The USPS vacant file is also a valuable add-on to CASS. Maintained and updated monthly by USPS carriers, this file will flag addresses that have been vacant and without mail delivery for at least 90 days. Surprisingly, capturing customer name information is a valuable component to address hygiene. Check your database for proper formatting for first and last name. Don’t mix data fields by including business titles in the name field or span personal or company name data in your address fields. Name fields are used for postal matching in NCOA, and extraneous data in the address field may cause your mail to become UAA. Ensure you have sufficient space in your database for addresses. Thirty to 50 characters is the new norm. Specify a separate field for secondary address information like apartment or suite; it serves as a reminder to enter it. This should be for any internal system as well as your website. Entry staff should be trained on all proper address elements and abbreviations. Again, Publication 28 (available on the usps.gov website) is a great training resource. SOME ADVANCED SOLUTIONS. Have some addresses that just won’t match? Print out some records on your database that don’t have a Zip+4 Code assigned to them for review. You’ll be surprised and amused by some of the problems. These include “run-ons” (124SouthMill), extra digits (100000 Euclid), invalid abbreviations (17 So Watt St or 492 Jackson Bl), misplaced secondary addresses (47 #A Cedar Rd), or random characters (5!7 M0ss St). The USPS offers an excellent set of tools for problematic address resolution. Address Element Correction (AEC) uses advanced address matching based on USPS-developed algorithms. It typically resolves about 30% of addresses you provide at a cost of less than $25 per thousand addresses provided.

AEC’s big brother AEC II uploads unresolved AEC addresses to local delivery offices for Delivery Force Knowledge (i.e., carrier) resolution at a cost of $.31 per resolved record. ACS is a post-mailing address correction service that allows mailers to receive changes of address and other reasons for non-delivery electronically. ACS is available for all classes of mail and is used in combination with ancillary service endorsements. Full-Service IMB mailers can obtain this data at no charge in some cases. Unfortunately, not everyone who moves notifies the USPS. In fact, the USPS estimates that nearly 40% of movers never file a change of address with the Postal Service! How do you locate these people (who may be some of your most valuable customers)? Many mail service providers (MSPs) offer a Proprietary Change of Address service compiled from third-party sources, including magazines, catalogers, utilities, and financial institutions. Your entire file can be “scrubbed” against these files, or you can provide the data from your most recent batch of returned mail. You may be pleasantly surprised by the results! IN CONCLUSION. Be aware of the impact of your UAA mail. You’re not alone. It’s an industry-wide problem. It’s important that everyone in the mailing industry makes effective delivery of mail and reduction of UAA mail their goal. Your MSPs and the USPS both have tools to assist you in reducing your UAA mail. Don’t be afraid to call them and ask for their advice and assistance. ¾

GARY A. SEITZ is Vice President of CTRAC Direct and has been a frequent presenter on UAA mail at the National Postal Forum and Postal Customer Councils around the country for over 30 years. Gary can be reached at GSeitz@ctracdirect.com or by calling 216.251.2500 x 4985. This article is based on material presented in a session at the 2016 NPF by Gary A Seitz and Jim Wilson of the Address Management group of the US Postal Service. MailingSystemsTechnology.com | SEPTEMBER-OCTOBER 2016

SAY WHAT?

Think About It

Why is so much mail undeliverable? The primary reason is that over 75% of the recipients no longer receive mail at the address — simply, they’ve moved. Another 12.5% have missing or incorrect address elements (usually a secondary address like apartment/suite number), and another eight percent are destined to vacant addresses. — GARY A. SEITZ

“Over 50% of mail center supervisors [among survey respondents] utilize their Postal Customer Councils as a source for continuing education, while only a little over a third of mail center managers reported doing the same.” — AMANDA ARMENDARIZ 30

SEPTEMBER-OCTOBER 2016 | MailingSystemsTechnology.com

WITH THE MANY EXISTING MARKETING CHANNELS WE HAVE TODAY, NOT TO MENTION NEW ONES THAT SEEM TO POP UP ON A DAILY BASIS, POTENTIAL AND EXISTING CUSTOMERS CAN BE ANYWHERE. AN EFFECTIVE MULTICHANNEL MARKETING PLAN WHERE BUSINESSES REACH THEIR CUSTOMERS THROUGH DIFFERENT MEDIA ALLOWS THE RECIPIENT OF THE MESSAGES TO DECIDE [HOW TO RECEIVE COMMUNICATIONS].

— VINCENT DEANGELIS

Organizations must take the appropriate measures to ensure that sensitive data is secure. Software that provides factory controls and tracking capabilities for each mail piece throughout the entire manufacturing process is critical to ensure correct and complete packages. — GINA FERRARA

Remember, the prospect is always a person, not a company. Make [the direct mail offer] relevant to that person — they are your entrée to the company. — DAVE LEWIS

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