Postal Service Outlook for 2022

The U.S. Postal Service is the backbone of the country’s direct mail industry. Even with significant challenges to its finances and operations in recent years, it is still by far the world’s most robust, versatile, and trusted postal delivery system.

Here’s one proof:

For the year ending September 30, 2021, volume in the Marketing Mail class jumped 3.4% to 66.2 billion pieces. At the same time, revenue increased 4.9% to $14.5 billion.

In 2022, to help create a great marketing experience for your customers, you should be aware of the changes underway in the mailing environment.

Postal Service Changes

Reform of the postal service has been on the minds of members of Congress for years. However, even with some consensus about many of the needed changes, progress on a bill is slow.

Without new legislation, USPS has undertaken measures on its own to increase efficiency and reduce costs in the postal delivery system.

Delivery for America Plan

The 10-year blueprint rolled out by USPS in March 2021 seeks to achieve financial stability and build for the future by:

• Investing in new postal delivery vehicles
• Using more trucks instead of air transport for moving mail across the country
• Installing new packaging sorting machines to handle increased e-commerce demand
• Streamlining retail services by closing post office branches

Keep in mind that the USPS plan is subject to interpretation and development of details. They can be shaped and modified with mailer involvement in the process.

New Delivery Service Standard

New USPS service standards for First Class Mail and Periodicals were adopted in October 2021. The delivery time for about 39% of mail in these classes was adjusted to within 5 days, a rise from the previous guideline of delivery within 3 days.To deal with the lagging delivery times, here’s how to optimize your own mailing practices:

• Start mailing cycles earlier for invoices and statements (a major component of First Class Mail)
• Speed up production times by mailing less complex campaigns or formats – or printing components earlier than needed
• Consolidate campaigns from different areas to mail at presort rates and get delivered faster
• Shift segments of higher-value customers or prospects to First Class Mail from Marketing Mail

Cost-effective practices will drive USPS’s network sustainability changes, even as it covers more delivery points than ever before.

New Rates

Prices rose twice in 2021. Fortunately, there’s only one price adjustment for Market Dominant (First Class and Marketing Mail) postage on the schedule, for July 2022.

However, current inflation pressures and planned twice-a-year adjustments starting in 2023 make it more urgent than ever to find ways to keep the costs for mail campaigns under control as much as possible.

Whether you use more automation, better data hygiene and segmentation, or shift campaigns to other formats or mail classes, you’ll need to be laser-focused on affordability.

Incentives for Innovative Postal Tech

Direct mail does not stand still.

It incorporates some of the latest digital printing and marketing technologies to push the edge of the envelope and keep mail relevant and exciting to customers.

As in recent years, USPS is providing promotional discounts in 2022 to qualified campaigns in six key areas. Note: Informed Delivery is broken out separately in the next section below.

Tactile, Sensory, & Interactive Mailpiece Engagement Promotion

Description: Mail that incorporates a multi-sensory experience, including sounds, scent, visual effects, or taste with papers and inks

Discount Amount: 4% (up from previous years)

Effective Dates: February 1-July 31, 2022

Emerging & Advanced Technology Promotion

Description: Mail incorporating NFC, Video in Print, voice assistants, or enhanced augmented reality

Discount Amount: 2-3%

Effective Dates: March 1-August 31, 2022

Earned Value Promotion

Description: Mail using Business Reply Mail, Courtesy Reply Mail, or Share Mail

Discount Amount: $0.02 per piece credit

Effective Dates: April 1-June 30, 2022

Personalized Color Transpromo Promotion

Description: Transactional mail (statements & bills) that uses dynamic and variable color print to create personalized marketing messages

Discount Amount: 3% (up from 2%)

Effective Dates: July 1-December 31, 2022

Mobile Shopping Promotion

Description: Mail using QR codes, Voice Activation Call-to-Action (VACTA), or Image Recognition to drive sales

Discount Amount: 2%

Effective Dates: September 1- December 31, 2022

The higher discounts, as well as improved response rates, will help improve affordability of mail and move the channel forward.

Informed Delivery

Offering consumers a preview of their incoming mail is increasingly popular.

How popular?

As of this writing (February 2022), the USPS’s Informed Delivery program has reached a national household saturation of over 25%, with 45.7 million opt-in subscribers, and 38% year-over-year growth.

Other eye-catching stats for the year ending September 30, 2021:

• Average email open rate of 64%
• 30 billion total single mailpiece and package impressions
• 55,276 campaigns and 12.9 million campaign clicks
• Average click-through rates of up to 10.17% (depending on industry)

To further accelerate the growth of this service among marketers, USPS has offered discounts for qualified direct mail campaigns that include an Informed Delivery element.

Discount Amount: 4% (up from 2% in previous years)

Effective Dates: August 1-December 31, 2022

Conclusion

Although the mail environment presents challenges, marketers always find ways to work with USPS to come out strong. There are significant opportunities to shape the course of change in the postal system and deliver great ROI on your direct mail investment.

At mailing.com, we have over 50 years of experience helping marketers like you get their mail into customers’ homes as quickly and affordably as possible.

Our mailing services and data management teams work within USPS’s regulations to find savings on all of your campaign’s costs – from setup and pre-press to printing and mailing. Drop us a line or call us! We’d love to show you how to mail successfully.