7 Myths of Direct Mailing Think all your mail is delivered equally? Think again.

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1 7 Myths of Direct Mailing Think all your mail is delivered equally? Think again.

2 Direct mail has the highest response rate and some of the best return on investment numbers of any marketing channel available today. Marketers sent 87 billion pieces of it in 2012, representing 54% of the mail the United States Postal Service handled last year.* In fact, direct mail has comprised more than half of the mail stream every year since Direct mail is the original direct marketing channel. By any measure, it delivers results, and many marketers have been honing their approach to it for decades. But even marketers who know direct mail inside and out often don t know some simple truths about what happens to their mailings. Direct mail has the highest response rate and some of the best return on investment numbers of any marketing channel available today. There are many myths around essential mailing issues. These misconceptions impact every facet of direct mailing, from the factors that impact deliverability to what you can tell about how your mail is handled, how to tell when it won t get there on time, and what you can do when that s the case. Here are the top seven myths of direct mailing, and what you can do about them. Myth 1: When you send out a direct mail campaign, all of the mail is delivered to your anticipated recipients on time. Not all your mail gets where it s going. Even when it does, sometimes it gets there too late to do you any good. And the USPS is going through many changes that are likely to impact both delivery rate and times. That s not to take anything away from direct mail or the USPS, which works hard to get most of the mail where it s going in a timely fashion. But even for First Class mail, the average deliverability rate fluctuates between 95% and 99%. How much does a 4% swing in postal delivery impact your campaign s bottom line? In a 200,000-piece mailing, that s a difference of 8,000 recipients, and likely a significant number of total orders. 1

3 The US Monitor Non-Profit Standard Mail Delivery Study for the first quarter of 2013 found that 95% of the mail it studied was delivered, and it could take standard nonprofit mail anywhere from 1 day to 35 days to arrive in homes, with an average delivery time of 10 days. I think in a lot of cases, late delivery is just as bad as nondelivery, says Paul Ercolino, president of New York-based mail monitoring company US Monitor. We work with a lot of retailers who target their mailings around an in-home window to get a sale out. Obviously, if that mailpiece arrives after the sale, they re losing the opportunity to get those sales. USPS Changes Coming in 2014: Delivery will likely be affected by the USPS network rationalization and the planned closure of 150 postal facilities in Those facilities could mean different deliverability standards for mailers across the country. Right now, I think everything s changing, says Judy Kalus, senior business analyst at Pitney Bowes mail monitoring division TrackMyMail, which is a strategic partner with US Monitor. She s already fielded calls from clients who will be impacted by those closings. The post office in Athens may be closing, Kalus explains, and my mailer wants to know, if their mail has to go to Duluth outside of Atlanta to be processed and then trucked back up into the Athens market, how would that impact their delivery? Even though those facilities are in the same state, this would add several hours of travel time to each delivery, which she calls a pretty significant change. 2

4 Myth 2: Every mailing is delivered the same. Every mailing is different and its mail moves through the mail stream in unique patterns. However, you can build a profile of each mailing s delivery trends by monitoring them over time, so you know what to expect and can see when something has gone wrong. The U.S. Post Office is such a ubiquitous and reliable part of American life that it s easy to forget that each piece of mail is still a physical article that must be bodily carried from your drop point to each recipient, whether that person is in midtown Manhattan, the Midwest or the middle of nowhere. Mailings are unique, says Ercolino. As a small mailer, you might not have the same visibility you d have at the postal facilities than if you re one of the large mailers in the industry. It really helps to have the knowledge of being able to check the actual in home. Some of those destination post offices are further from their sorting centers than others. Some may be eliminated as a result of network rationalization. Sometimes the mail has to go through places that are flooded, on fire or recovering from tornadoes. Unexpected events like natural disasters have had a massive impact on mail delivery in recent years, says Kalus, and not just delivery to the affected area, but any mail that has to be transported through it. Storms like Hurricane Sandy and the 2013 tornadoes and thunderstorms throughout the Midwest caused chaos for mail delivery. With Sandy, it was bedlam, says Kalus. Post offices flooded throughout metropolitan New York and New Jersey. The trucks would show up and they would reroute the trucks to another facility. Here s a truck driver from Florida now trying to find his way through New Jersey in all that chaos. 3

5 The 2013 Midwest storms and tornadoes forced authorities to close highways throughout the region. So if your mail left Florida on May 22 destined for the Northwest and the truck hit that storm, and they re pulling everybody off the road, that s an unexpected event where visibility is key, according to Kalus. She estimates that mail was probably three to five days late getting into the Northwest during that period. Mailers who have a clear view of how their mail deliveries behave, the timing with which they reach different parts of the country, can anticipate what these delays are going to do to their campaigns. Mailers who have seed locations collecting and reporting on endpoint mail delivery will be able to see when that last mile of the mail delivery has been disrupted and act to compensate for the marketing. Myth 3: only USPS Intelligent Mail barcode data to monitor your mailing. The Intelligent Mail barcode (IMB) is a good, reliable tool for tracking your mail delivery. But it s only one tool in an overall monitoring strategy, and it has its limits. There is no scan at your recipient s doorstep, for example. You ll get a much clearer picture if you have a monitoring strategy that combines IMB data with seed mailboxes in the sectional facility zones to verify when your mail is delivered by that local post office. In 2005, the USPS began offering the IMB to better track and manage mail flow and to give mailers better visibility of what s happening to their mail. The barcode is scanned at each sorting facility that touches the pallets and mailpieces, and those scans are recorded to prove where your mail is in real time. The system gives mailers far greater transparency in their dealings with the USPS, but there are some blind spots. For starters, the mail is only scanned at the various sectional sorting facilities it passes through, and that leaves the mail unmonitored over the last mile to your recipient s front door. Second, a lot of circumstances can disrupt delivery before and after the scans. 4 With the IMB, on letter-size mail, a pretty high percentage of mail gets scanned, in the high 90 percents, says Ercolino, but the delivery date projections based on those are not always 100%

6 accurate because it all depends on the destination delivery unit level [i.e. the mailman] and on that destination post office to determine whether it goes out that day or the next day. Remember the delivery times from the nonprofit mail study in Myth 1? You don t really know if the mail was delivered the day after you mailed it or the month after you mailed it unless you have a seed collection address in that zone that will report when it received that mail. Myth 4: All mail with an Intelligent Mail barcode is scanned at every stop as it moves through the mail stream. Not every post office and sectional facility has the scanners for every type of mail, especially for flats-sized mail like newsletters, magazines and catalogs. Even for letter-size and postcard mail, there are a few facilities throughout the country that do not currently have the scanners to report on it, but generally over 95% of those mailings are going to be scanned and tracked by the IMB. The story is different for flats. Only about 60% of the postal sorting facilities have the equipment to scan the IMB on flats. Most flats mailings have about a 70% scan rate, but Ercolino reports the scan rate can be as low as 50% to 60% for mailings with a higher volume of mail to those facilities. That s a lot of lost visibility. Even less visible are flats sent at the carrier route rate. Those are put right into the carrier route mail stream and miss the scans altogether. Ercolino does not even recommend mailers include the IMB on that mail, because no data is returned. The only way to monitor these mailings is through a mail monitoring service with mail seeds in those carrier routes. Unless you want to become very familiar with the postal facilities that do not have flats scanners and research it and anticipate which of those facilities is going to be touching your mail, then you should anticipate a lower scan rate from IMB on flats, says Kalus. And she adds, mail monitoring is an excellent solution to that problem in that the seeds can compensate if you re missing in-home scan data on the flat piece. 5

7 Myth 5: You can t know the day your mail You can predict the day your mail will be in-home with a high degree of accuracy if you have a mail monitoring strategy in place and have the historical data to see the trends for your mailing lists. As you ve seen, there can be a wide gap between when the first mailpiece in your campaign is delivered and when the last is delivered. But, in the middle, there is a window when the large majority of your mail is arriving in-home, and you can forecast that to the day if you re gathering the mail monitoring data. Mailers can be very, very good with predictions if they have good benchmarks and if they re measuring deliverability, says Kalus, and if they re tracking through some method so they can see what the trend is. According to Ercolino, a long-term mail monitoring strategy gives you a trend analysis over a period of time, so you can look at when you did your mailing last September vs. this September. You can use those projections to decide when you re actually going to drop that mail to achieve the actual in-home dates you want. When you know when your mail is going to be in-home, it opens up a lot of multichannel marketing tactics to increase response. You can coordinate it with other marketing activities like , says Ercolino. Say you re sending out a postcard for a sale that s coming up that weekend for your department store. When you know that mail s going to be arriving in-home, you can target a secondary offer via saying, Look for your postcard in the mail, where you ll get an additional 20% off if you click here! You can create multichannel marketing experiences by triggering an or a phone call off of that actual in-home delivery. 6

8 Myth 6: You can t tell if your mail was delivered in time to do anything about it. IMB and mail monitoring data are available in real time, while your campaigns are in transit. Often when there s a problem, this real-time data allows you to spot it several days before your expected delivery date. In fact, not only can you see what your campaigns are doing in real time, most monitoring services will send you an alert to let you know if something in the data looks off. If you know your mailpiece was scanned and that tray was supposed to be heading to Chicago, and somehow it winds up in Milwaukee according to a scan, you have time to react, says Ercolino. It gives you a lot more flexibility in real time. Before the IMB, the only way to monitor mail delivery was with mail seeds, and that information was only collected after the fact. We would do a mailing, do a study, and show how many days it took to be delivered, says Ercolino. But now that you have the IMB along with the seeds, we can give real-time information. Now, if you send a pallet of mail to recipients in the Chicago area, and you see it s going to be two days late based on the IMB scanning data, you have time to react. 7

9 This data is also useful after the fact when talking to the USPS about your mail delivery performance. According to Kalus, mailers take the delivery time data to meetings with post office representatives at events like National Postal Forum. If you re talking to a district manager, there are two kinds of conversations you can have, Kalus explains. The first is My mail never seems to get delivered on time through your facility. What are you doing? The second is Here s data for the last six months, you can see here that you re improving tremendously. Or, We have some trouble spots in this ZIP code, and you can show them the data that documents that trouble. Which one of those discussions is going to have a better outcome? Myth 7: If your mail is late, there s nothing you can do about it. Successful businesses act on their information. With real-time reporting, you can see mail delivery problems in time to make business decisions on the data and do something about it. If you know your mail is going to be late, you can account for that delay in your response models. If it had a crucial time-sensitive element, you can take steps to make sure your offer is still successful in that area. The specific timing of a mailpiece is more important to some marketers than others. However, if you send any time-sensitive mail even if that sensitivity is just adding staff to handle the uptick in response then a two or three day delay can cause real havoc to your cash flow and supply chain. These are developments that must be addressed, and can be addressed. I ve seen a full-blown telemarketing campaign go out to mail recipients, letting them know their mail had been delayed and sending them to a website where they could still get that information, says Ercolino. 8 For example, a retailer may be counting on its campaign to drive customers to stores across the country for a one-day sale. But if they see that mail is running late in Houston, so late that it won t be received in time to get people to the store on that day, that retailer can use other methods of contact to get the word out. They can send an to customers whose s are on file, telemarket to those with phone numbers, or perhaps even roll out a local radio campaign to ensure turnout.

10 Kalus has seen mailers take similar actions; and sometimes the issue is early delivery, not late. A hotel property that now works with us actually had a mailing go early once, she explains. They were using a letter shop, and they released the mailing early which never happens and it got in-home early. The mailpiece in question was sent to the hotel s most desirable reward members, and it was for a Valentine s Day special that rewards members knew well and would wait for every year. When they got that postcard, they would run to their phones to book the rooms before they ran out, says Kalus. Because the mail was delivered early, those calls started coming before the hotel had seasonal help on hand to field them. They wound up with 150 callers on hold. Visibility into the mail stream allows a mailer or a marketer to prepare for that kind of situation, says Kalus. If you re watching those responses, you know, How do I react to this? Am I staffed appropriately? Conclusion Even experienced marketers may believe these common myths about mail performance and visibility. The truth is, today direct mail does not have to be a send-it-and-forget-it proposition. You do not have to simply accept that your mail was delayed by a thinning postal service, natural disaster or worse. Between the IMB, mail seeds and a strong mail monitoring strategy, you have the power to follow your mail s journey through the mail stream from drop off to delivery. With realtime statistics and alerts, you can manage your company s mail, adjust to unexpected difficulties, and shatter the myths of direct mail. About US Monitor Since 1973, US Monitor has built a strong reputation as the nation s most reliable and effective mail monitor service by bringing together state-of-the-art technology and old-fashioned attention to detail. We have monitored hundreds of millions of pieces of mail for thousands of customers who choose US Monitor for our leadership, integrity and experience. Let us be partners in your direct marketing campaigns! 9