What does the price of gas have in common with the price of postage stamps?
Not much, but when the price of gas goes up $.01 it costs the post office around one million dollars.
What does this mean for direct marketers? Well, since we can't control the price of gas we need to prepare ourselves for a postage increase next year. Another increase is expected in May 2009, with the amount to be announced in February. Don't worry just yet...any increase will be limited to the rate of inflation.
The US Postal Service recently posted a $1.1 Billion loss for their 3rd quarter. A portion of this loss was blamed on higher fuel prices along with a number of other reasons having to do with mail volumes and the economy. You tell me will we pay more to mail a postcard next year?
If you use direct mail to market your business you should keep mailing (assuming you generate a positive ROI on your efforts) and start thinking about how another increase will impact your marketing efforts. How can you reorganize your marketing plans to maintain your current mail volumes? What other marketing channels produce an acceptable ROI?
Let me know what you're planning to do if the price of postage goes up again.
Hi Josef, I do enjoy sending out post cards and other direct mailers so I guess I may have to adjust how many I send in order to stay within the budget, or increase the budget to accommodate the number of pieces I send out annually. It's almost like a coin flip for me. I guess I will have to just wait and see how much everything increases before I make my final decision. Enjoy your day. Regards, Carolyn.
Wow thats some food for thought gas goes up 1 cent and in turns costs the pos office 1 million dollars!
Carolyn,
Always go with quality over quantity and you will be OK. Make sure your direct mail lists are targeted and you should be on track to generate the ROI you need to justify your mailings.
Justin,
Really makes you think about the price of gas doesn't it? It is always the little things that don't get our attention...
Hi Josef - No suprise here. The cost of energy is having an impact on many things. That ole inflation word again rearing it's ugly head.
Here is an idea for the post office... Cut off Saturday mail delivery. Go back down to a 5 day week. Also in far out rural areas cut it down even more. Where in the constitution does it say everyone is guaranteed to have mail delivery 6 days a week?
It is outragous that a monopoly like the United States Postal Service can not manage to turn a profit. We should start letting UPS and Fedex compete with the USPS and see what that does to prices. I bet they will go down.
As for marketing... Email, email and email some more. Create those databases and then email.
Bill, everything is getting more expensive not much we can do other then plan to pay more.
Billie, Great idea and I suggest we take it one step further. How about mail delivery every other day. I say let in all forms of competition and you will see how fast the USPS turns around or goes out of business. I know it is hard to believe but behind the scenes the USPS is actually efficient just not sure why they keep loosing money and fail to adapt to changing times.
BTW - Did you know that postal workers don't have to pick up mail from your home. That it is a courtesy and not a requirement. The USPS delivers mail they don't pick it up.