Help stop the internet sales tax…


Important information to act on now.  (thanks to our friends at ACMA for allowing us to share this)

Urgent Industry Alert:
CEOs, Presidents: Last Call To Make A Difference;
Contact Your Senators Monday

Dear Catalog Industry Executive:Whether you wrote last week or didn’t get a chance to yet, the Senate is scheduled to take action today. The Marketplace Fairness Act will definitely cost you money and could potentially ruin your catalog business. The industry needs all C-level executives to call to Senate offices right away. Let’s light up the lines. It will influence the result, especially if they know you – but call either way. This is our last chance to make a difference. Do not delay. For starters, please check out this editorial in today’s Wall Street Journal, as it can greatly help our cause and yours when you make your calls.Click on each title below for all the important tools you’ll need:

Click here to review the details ACMA distributed in our alert from Friday
Last and not least, we are working round-the-clock coordinating industry efforts, so we need to hear from you too. Please use the following address to let us know which actions you take: action@catalogmailers.org.
Sincerely,

Hamilton Davison
President & Executive Director
American Catalog Mailers Association
www.catalogmailers.org
hdavison@catalogmailers.org

The Postal Direct Mail Nightmare Continues: BREAKING NEWS: USPS Appeals Exigency Rate Case


Note: this just in from our good friends at ACMA
October 22, 2010 

Special Bulletin: USPS Appeals Exigency Rate Case
 

 

Dear Catalogers, Suppliers & Others With Catalog Interests: 

While mailers were still rejoicing over the victory on the exigency rate case, the USPS filed a lawsuit today in the U.S. Court of Appeals to reverse the widely heralded Postal Regulatory Commission decision. The Postal Regulatory Commission on Sept. 30 denied the USPS’s extraordinary request for a well-above-inflation-rate postage price increase that would have effectively nullified the Congressionally-imposed rate cap.

 

In its latest filing, the USPS requests a review of the PRC’s interpretation of the law that governs how prices are set and asks the Court to confirm it has the right to file an exigent price increase. It also seeks clarity regarding the rules governing how an exigency increase will be applied should it find itself in a similar situation in the future. According to a USPS statement on the matter, it is also reviewing other options open to it in light of the PRC ruling.
What does this mean to you? Right now, it is a little hard to say definitively. Courts have historically sided with regulators provided it can be demonstrated the regulator followed its own rules and practices in arriving at a decision. We know of no basis to conclude otherwise at this point, indicating the PRC decision should stand. However, clearly USPS execs have an approach they believe has merit, or they would not have gone to the cost and trouble of an appeal.

ACMA’s Approach
As it has all along this process, ACMA will monitor developments closely and may decide to intervene alone or with others supporting the PRC decision. Unfortunately, this development puts into question how much you should budget for the coming year. Until further information is available that suggests otherwise, we recommend sticking by earlier forecasts we gave to members, but you can be sure we will stay close to this matter and let you know when a clearer picture is available. 

Happily, ACMA has some money available from its Special Fund and general coiffeurs that give us options as to how to proceed. This is a great reason why it is in your best interests to make sure you have a properly resourced group to address unexpected developments quickly to protect your interests.

More to come…

Sincerely,

Hamilton Davison
President & Executive Director
American Catalog Mailers Association
Direct: 401-529-8183

The Postal Rate Commission (PRC) Denies Exigent Postage Rate Increase … Big !@#$ Deal


Recently, The Postal Rate Commission denied the US Postal Service an exigent postage increase.

So, OK, now what?

So, Direct marketers aren’t getting slammed with another 5 percent-plus postage rate increase in January. Big whoop-de-doo. Postage is still the biggest expense in all my clients’ mail campaigns. And the cost of mailing vs. the risk of the unknown is still the biggest reason marketers shy away from the direct mail channel.

The second biggest reason? Well, everybody has heard the horror stories. All that money spent on killer creative, design, lists, printing, postage, and then the campaign bombs.  And then everybody talks about how the campaign bombed and direct mail sucks.

OK, so many of those direct mail campaign “bombs” forgot to follow the basic principles of the business — i.e., the 40/40/20 rule. They probably did the creative first and then figured out lists last like most companies I see do.

This kind of activity perpetuates the urban legend that direct mail doesn’t work. Well, except for a few companies. Those companies, you know, the junk mailers, the big companies with unlimited budgets who don’t care about results and just want to build their brand images… they are the ones who do well.

Now I won’t even get into the whole environmental argument of direct mail not being green. Believe what you want, but that’s a myth. The direct mail and paper industries are ultracautious to replenish the environment.

And let’s not forget about our internet marketing brethren, who have done such a wonderful job throwing direct mail under the bus, positioning it as passé or old school, while they prop themselves up as the future of direct marketing. I won’t even go there today.

Let’s face it, direct mail has a bad reputation. But that can change. Here’s how:

The smartest thing those wunderkinds at our beloved Postal Service can do is nurture the direct mail industry. Imagine what would happen if the USPS actually offered discounts for online marketers to give direct mail a chance? Now imagine the same thing happening with small and emerging businesses. How many companies would try direct mail if the risks were reduced? How many tests? How many rollouts?

And what about nurturing those retailers who still use direct mail as a major part of their marketing programs? Sure, the USPS has tested some “Summer SalesOpens in a new window,” which is a move in the right direction, but it’s time for the Postal Service to stop dipping a toe in the water and give volume mailers an opportunity to push their circulations up. Seasoned mailers know the results are there, they’ve just been beaten down by a constant barrage of postage increases.

More importantly, over time, how many direct mail pieces are needed in circulation to drive additional revenue for the post office? Some way the USPS is going to have to get itself out of the bureaucratic hole it’s dug for itself.

Hey, I’m not dreaming here. It’s a simple business model: high costs = less volume, lower costs = increased volume.

The USPS has traveled the higher-priced road before, and in the process did an amazing job of building up the internet and literally exploding the size of the online marketing community (to which it offers thanks, by the way).

Maybe now it’s time to think things through and encourage more mailers and subsequently more volume. And inevitably if they do it right, more (well, to be fair … SOME) profits.

BREAKING (GOOD) NEWS: postal-regulatory-commission-denies-exigent-rate-increases


The Postal Regulatory Commission Denied the Postal increase.  Read about it here

http://www.dmnews.com/postal-regulatory-commission-denies-exigent-rate-increases/article/180018/?DCMP=EMC-DMN_iMktingNewsDaily

We at Gilbert Direct Marketing, applaud the PRC for denying the exigent postal rate case.  As I have said before every penny direct marketers have to spend on direct mail, with it’s biggest expense already postage, we have to add 2 cents of revenue to cover the increased costs.

Despite its negative image lately, mostly fostered by environmentalists and internet marketers, direct mail remains a highly targetable and enormously profitable marketing channel.  Presently I have clients who are seeing ROI in the range of 6 to 1.

U.S. Post Office plans another Summer direct mail sale: details…


This is from the Direct Marketing Association website.

At MTAC yesterday, Tom Foti, USPS Marketing Manager described the 2010 Summer Sale. The sale will cover a 5-month period with the sale period starting July 1 thru Sept 30. June and October will be control months. A 30 percent rebate on incremental volume will be offered above a baseline. The sale is for Standard Mail letters and flats only. The customer’s baseline will equal Same Period Last Year (SPLY) numbers plus 5 percent. A downward adjustment will occur if June and October volume is below baseline. To be eligible, a customer has mailed over 360K Standard Mail pieces from July 1 thru Sept 30 2009. According to Foti, there are approximately 3,525 customers eligible or 67 percent of Standard Mail volume. Mail Service Providers are not eligible to participate.

USPS Timeline:

File notice with PRC (late Feb)

Invitation to participate mailed (early Mar)

Customers register online and certify agreement with threshold volume on-line for program participation (Mar-May)

PRC decision (mid-April)

Sale period (July through Sept)

Rebates to customer accts (Dec 2010- Jan 2011)

Winter Weather Affecting USPS Facilities and Direct Mail Delivery


From my friend Eric Schmidt at Quebecor/WorldColor…

Winter Weather Affecting USPS Facilities and Delivery
February 8, 2010
Worldcolor Logistics NEWS FLASH – Issue #264

Significant snowstorms across the Midwest, Mid-Atlantic and Northeast
regions have caused some delays and even closures for the USPS. These
delays have effected the distribution of mail, newsstand and newspaper
deliveries and the storms aren’t over yet. Accumulations between tomorrow
and Wednesday are estimated at 4 to 12 inches across the above noted
regions. Below are the areas currently effected:

Memphis, TN
A winter storm warning remains in effect until 4 p.m. CT this afternoon.

Cincinnati, Ohio
Due to severe weather conditions on Feb. 6, the Postal Service has
suspended delivery and collection operations for the following offices:
* Darke County Post Offices: Ansonia, Arcanum, Bradford, Burkettsville,
Gettysburg, Greenville, Hollansburg, New Madison, North Star, Osgood,
Palestine, Pittsburg, Rossburg, Versailles, Yorkshire.
* Findlay Post Office (45840).
* ZIP Code 453: Brookville, Casstown, Christainsburg, Conover, Eldorado,
Fletcher, Houston, Lewisburg, Russia, West Manchester.

Virginia
Local Postal Operations in Orthern Virginia were suspended Saturday Feb. 6.
Affected postal operations in the ZIP Code areas beginning with 201,
220-223, 224-225, 226, and 227 in Northern Virginia area.
In Richmond, Post Offices, stations and branches closed retail operations
and suspended mail delivery and collections of mail from boxes on Saturday,
February 6, 2010.
This suspension affected postal services in the ZIP Code areas beginning
with 224, 225, 228, 229 and 244.

Maryland
Due to the winter snow storm blanketing the Baltimore metopolitan area, the
Postal Service suspended all services including retail operations, mail
delivery and collections on Feb. 6.
The suspension affected ZIP Code areas beginning 210 through 219 in
Baltimore, MD, and the northern and western portions of Maryland.

Worldcolor Logistics (WCL) will continue to monitor the situation and
implement the best course of action to mitigate the effects of this severe
winter weather.  WCL will provide additional updates should elongated
delays become likely.

For more information regarding Worldcolor Logistics or for access to past
news publications, visit our Web site at www.worldcolorlogistics.com.

An Important Announcement to ALL Environmentalists & Direct Mail Haters (no political correctness here)…


“No trees were killed in the sending of this email. However, a whole bunch of electrons were terribly inconvenienced.”

The above is the email signature of a friend of mine. While meant to be tongue-in-cheek, it actually makes a strong, yet entirely off base point: Electronic mail is somehow less harmful to the environment than paper-based mail.

Correct me if I’m wrong, but the sending of email does kill trees (I’ll discuss this more below).

Whenever I write about direct mail here, the environmentalists come out to visit. Well, visit may not be the right word; maybe I should say they come out to hate. They must be trolling the internet looking for anything positive about direct mail to take a shot at, like drive-by haters.

So I’m going to set the record straight. And you environmentalists take note, please.

Here’s my question: Which is worse for the environment, direct mail or email? I think email, and here’s why.

  1. Every email sent generates power consumption. Think of all the routers, servers, internet service providers and PCs involved. Consider all of the big-box companies that sell and service PCs. Maybe someone out there has done the math, but I’m sure there’s a hard cost in terms of power consumption per email.
  2. Same goes for time trolling the internet looking for direct mail folks to hate on. If a computer’s on, it’s using energy.
  3. Now here’s the tricky part: Where does the energy that email and computers use come from? It’s not very clean at all, is it? Our electricity is still very much powered the dirty old way, thus the energy consumed by email and the internet isn’t very clean — something environmentalist, direct mail haters don’t really talk about; truly their dirty little secret.
  4. Most people recycle their direct mail, catalogs and newspapers because it’s the right thing to do.
  5. The paper industry — the backbone of the direct mail business — is heavily involved in reforestation (i.e., the planting of new trees to replace ones used for paper). In fact, and I hope some paper merchants will respond to this, reforestation efforts are usually at a ratio of two to one or greater.

Just to let you know, I recycle, and I believe in a future with clean energy, not because it it politically correct, or supports a particular political agenda, but because it just makes sense to do. But to say that direct mail is destroying the planet? That’s a weak and opportunistic argument. Direct mail is still one of the most powerful tools in a marketer’s tool bag if done according to principles.

Got comments? Post them below.

Guest Post: Black Friday? Cyber Monday? It’s Binge Discounting All This Week by Paul Miller


Note to my readers: This article from Paul Miller’s blog does a great job of putting discount holiday shopping into perspective.  As an aside, I’ve known Paul for many years and for the last 3.5 he’s been my editor at Catalog Success (now All About ROI) magazine.  Paul’s position as Editor in Chief recently got budgeted out of existence.  Check out his blog here.

Who knows where we’ll be a year from now, but at least for this season of store and online retail bargains, the killer sales are already going on. Although there will still be big store sales this Friday and probably even bigger ones online next Monday, the big retailers already began to duke it out for the lowest prices earlier this month.

As an article on the front page of Tuesday’s New York Times noted about the biggest store retailer (Wal-Mart) and online merchant (Amazon.com), the gloves have already come off. And as the Times article points out, Wal-Mart has used the media to pick apart Amazon.com’s discounting efforts, trying to ensure the public that its prices will always be the lowest. Meanwhile, Amazon.com has taken more of a high road, noting that bargains can come from all over, not just Wal-Mart.

These two “shopping holidays” haven’t been around all that long. Although Wikipedia tells us that the term “Black Friday” dates all the way back to 1966, it also notes that it didn’t take on a true shopping connotation until 2000. Cyber Monday didn’t hit its stride until just four years ago.

Now, however, with cash-strapped consumers perhaps looking to get back in the shopping game this holiday season, they’re hungrier than ever for a good bargain. Retailers, e-commerce merchants and catalog sellers are equally eager to offer the bargains to show some sort of sales gains this season to make up for the miserable time they’ve had throughout the Great Recession.

Then, you have to factor in the tragedy that took place at a Valley Stream, Long Island, Wal-Mart store just 12 months ago when bargain-hungry shoppers trampled over a defenseless Wal-Mart employee as the store opened at the stroke of 5:00am on Black Friday, fighting their way to the store’s sale items. Wal-Mart announced just last week that although its stores will open at 5am again this Friday, it would keep its stores open a full 24 hours thereafter to try to prevent more The Who’s 1979 Cincinnati concert-like stampedes from occurring again.

What this all adds up to is the likelihood of these two shopping holidays expanding beyond just the two days. This year will offer just a taste of it. Next year could see a considerable expansion of sales days at this time of year.

It’s a trend not unlike the so-called “fifth quarter” of retail business that evolved over the past 20-plus years as the holiday shopping season took on greater and greater importance to retailers, catalog marketers and later, online sellers. What started as a surge of sales immediately following Dec. 25 kept expanding week by week over the years, leading all the way back to this very week we’re now in.

If you can date yourself all the way back to the recession of the early ’80s, you might recall the last extended period of time in American retail when cut-throat discounting reached such levels. As the economy picked up in the mid-’80s, discounting eased up, full-priced retailing edged back and service levels improved. Perhaps that could occur as soon as next year at this time, but I’m guessing that the current state of binge discounting will prevail.

USPS “No 2010 Rate Increase”: The Loophole and a Call to Action


Just when I thought it was safe to believe in the U.S. Postal Service, I find out this lovely tidbit of information: Despite Postmaster General John Potter’s grand statement (or was it a grandstanding statement) that there’d be no postal rate increase in 2010, there’s a giant loophole.

No matter what Potter said in his memo, the USPS can still increase postal rates. Just to be sure, I asked Don Landis, vice president of postal affairs at Arandell Corp., a noted catalog printer/mailer. According to Landis, “It’s possible some mailers could see an increase in their postage come May 2010. The USPS could make regulation changes that would force mail into a more expensive category. We’ll know in January or February.”

How You Can Make a Difference
While I applauded Potter and the USPS for taking a stand for the direct marketing industry in this column two weeks ago, I hope I didn’t speak too soon. I still remain cautiously optimistic, but I also must do my part to help sway the decision. We must hold the postmaster general and the Postal Regulatory Commission to his/its commitment.

Thus, I urge you to write a letter to the postmaster general using the contact information provided below. Here’s the letter I wrote. Feel free to copy, paste and use it, or create your own. The key is to make your voice heard!

Dear Mr. Postmaster General,

You’ve started a trend here. Between the postal summer sale and now this offer to keep postal rates stable in 2010, catalog and direct mailers believe that you may actually be interested in working to our benefit. We look forward to the next postal sale, and hope that the USPS opens it up to smaller mailers to take advantage of. We truly hope that you’ll continue to stop thinking like a bureaucracy and encourage more mail volume with innovative special offers and such.

But direct marketers are also wary because the USPS holds a great deal of power and leverage over us. The last substantial postal rate increase nearly put us under with rate increases of 20 percent-plus. What was the USPS thinking? That move single-handedly drove more and more mailers into the online world. Doing the math, we believe the increase actually caused your revenues to go down due to less mail in the mailstream.

Remember this, Mr. Postmaster General: Every penny more it costs us to mail means we need to generate about 2 cents more per catalog mailed just to break even. In this economy, we need every opportunity we can get to mail our catalogs profitably. We’re struggling to stay alive and keep our workers employed and our customers satisfied.

Keep up the good work, Mr. Postmaster. Please continue this trend.

Sincerely,

The Direct Mail Industry

Reach the postmaster general at the following:

The Honorable John E. Potter
Postmaster General
U.S. Postal Service
475 L’Enfant Plaza, SW
Washington, D.C. 20260-0010
Email: pmgceo@usps.gov

Originally published in All About ROI Magazine

BREAKING NEWS: US Postal Service makes a bold statement: No 2010 postal increases!


Note from Jim: The USPS may have finally learned the lesson that higher postal prices drive down direct mail volume – resulting in lowered not increased revenues.

To Postal Service Customers:

Many of you have expressed concerns regarding mailing costs for 2010. The tough economic climate has presented significant challenges to all of us and pessimistic speculation has suggested that postal prices could increase by as much as 10 percent.

As we begin a new fiscal year and as many of you, our business clients, are preparing your 2010 operating budgets, we want to end all speculation.

The Postal Service will not increase prices for market dominant products in calendar year 2010.

Simply stated, there will not be a price increase for market dominant products including First-Class Mail, Standard Mail, periodicals, and single-piece Parcel Post. There will be no exigent price increase for these products.

This is the right decision at the right time for the right reason. Promoting the value of mail and encouraging its continued use is essential for jobs, the economy, and the future of both the Postal Service and the mailing industry.

While increasing prices might have generated revenue for the Postal Service in the short term, the long term effect could drive additional mail out of the system. We want mailers to continue to invest in mail to grow their business, communicate with valued customers, and maintain a strong presence in the marketplace. Changes in pricing for our competitive products—Priority Mail, Express Mail, Parcel Select, and most international products—are under consideration. We expect to announce a decision in November.

We are committed to working with customers to find ways to grow the mail through innovative incentives like the Summer Sale and contract pricing. Mail is the most effective means of communication and advertising and we will continue to work together to increase the value of the mail. Mail is a smart investment for the future.

John E. Potter

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