Key Notes – Volume 03 Number 19

Advertising Mail Future Prospects in Five Scenarios – The future of advertising mail has not been predetermined, but advertising mail must be positioned as complementary to Internet advertising.  The USPS and the mailing community have started down this path with creative initiatives, but more needs to be done. Otherwise, like most other forms of traditional advertising, mail will be crowded out of the advertising market.  The USPS Office of Inspector General issued a white paper outlining five possible scenarios for advertising mail from 2016 to 2025.  They include:  Growth and Complementarily; Return to Pre-Great Recession Trends; Recent Trends Continue; Internet Boom and Constant Traditional Share.  These scenarios are meant to be illustrative and are not mutually exclusive.  Read the full report here.  Source:  OIG

USPS Financial Woes to Be Addressed – A draft bill to reform the USPS and strengthen the “backbone” of the mailing industry is expected to be introduced in the House.  Rep. Jason Chaffetz (R-Utah), chairman of the Oversight and Government Reform Committee, said he anticipates the introduction of the legislation, which will address what should be done to keep the agency “effective and efficient,” and reverse the fiscally unsustainable path it is currently on.  “We are actively trying to address the pre-funding issue,” Chaffetz said during a May 11 hearing on postal reform. “We are obviously — as we’ve heard from across the whole spectrum of the board — trying to deal with the Medicare portion of that.”  Source:  Federal News

PMG Expects $1B Loss in 2016 Without Surcharge – “We are facing some headwinds given the recent decision by our regulatory commission to reduce our market-dominant prices,” said Postmaster General Megan Brennan on a recent conference call. “As a result of this price reduction, the postal service will forego approximately $1 billion in revenue this year and approximately $2 billion going forward.”  The 4.3 percent surcharge expired on April 10 following the 2nd quarter results.  The earnings report estimated that the surcharge was responsible for $519 million of its operating revenue in the second quarter.  Source:  Federal Times

The Latest Bid to Keep Print Relevant – Print magazines have struggled to compete with the rise of digital media and advertisers’ ability to target specific audience segments online. But now, Hearst is touting its ability to retarget print subscribers on their online journeys.  It’s doing so with a new campaign for Toyota’s new Prius, which marks the first time Hearst is targeting its print readers and then following them with digital ads, said Cameron Connors, who orchestrated the campaign as publisher of Hearst’s Popular Mechanics. Source:  Digiday

Continuing Financial Challenges and the Need for Postal Reform – Large unfunded liabilities for postal retiree health and pension benefits—which were $78.9 billion at the end of fiscal year 2015—may ultimately place taxpayers, USPS employees, retirees, and their beneficiaries, and USPS itself at risk.  Funded benefits protect the future viability of an enterprise such as USPS by not saddling it with bills after employees have retired.  Further, since USPS retirees participate in the same health and pension benefit programs as other federal retirees, if USPS ultimately does not adequately fund these benefits, and if Congress wants these benefits to be maintained at current levels, funding from the U.S. Treasury, and hence the taxpayer, would be needed to continue the benefit levels.  Alternatively, unfunded benefits could lead to pressure for reductions in benefits or in pay.  Source:  GAO

Full Service Assessments Postponed – The USPS has postponed Full Service assessments scheduled for July, which would have penalized mailers who fell short of established metrics.  Instead, it has announced an outreach for mailers to become more familiar with the Full Service metrics and Mailer’s Scorecard.  “The announced July date to begin assessments of Full-Service is being postponed to allow the industry additional time to access, utilize and test the Full-Service Mail Quality Metrics within the Mailer Scorecard,” the USPS announced.  Full-Service Mail Quality Metrics can be found within the Electronic Tab of the Mailer Scorecard beginning with the current month of May.  Here is a Guide to the Mailer Scorecard  Source:  MAIL

AR Turns Print Magazine Into a Digital Wonder – Some may say that print is dying, but that’s not exactly the case. It turns out that print magazines can still find new ways to be innovative in ways we never imagined possible. Then consider that The New Yorker’s latest cover comes to life when viewed through the lens of a tablet or smartphone. The magazine’s annual Innovators Issue came out with an original cover that features augmented reality content. Source:  BGR