Innovation waits for no one. While the Postal Service always has been a leader in embracing new technologies, we recognize the pace of change is speeding up — and we’re keeping pace. In fact, we’re accelerating our testing of new approaches to better serve our customers’ changing needs and bring mail much more deeply into their digital lives. We understand that it can be difficult to envision the prospects of mail with so many tools to utilize. We developed IRRESISTIBLE, a website and catalog that provides physical examples of printing techniques and emerging technologies that mailers can incorporate into their own campaigns.
In the pages of the IRRESISTIBLE book, customers can learn about textures, dynamic inks, augmented reality, QR codes and unique folds. All these facets culminate in a unique experience that stays with the recipient far after the lifespan of the mailpiece. On our award-winning IRRESISTIBLE website, there are even more examples of our applications, as well as case studies. We’re adding more advertising to mail in a way that is both effective for the mailer, but also more enjoyable for the recipient.
To keep up with increased e-commerce purchases and deliveries, the Postal Service has developed the next generation mailbox, a larger receptacle to fit today’s delivery needs. The mailbox improves the customer experience as it conveniently holds the majority of mail, so more packages get delivered to the box. Various models are available online for sale with big box retailers.
Our Mailing Business – The beauty of mail is that it’s tangible and tactile. We’re enhancing this distinct experience with digital facets to expand the possibilities of print. We want to drive our clients’ customers to engage with brands and purchase products via seamless experiences that break down the barrier between physical and digital. The future of mail depends on this merging of the physical and the digital. We drive this merge by incenting mailers to invest in new ways to use mail and to engage their customers through annual promotions.
Stamp Program – The Postal Service continues to issue postage stamps as a convenient and secure payment method for consumers.
The “Forever” stamp concept was first introduced in April 2007 with a stamp featuring the image of the Liberty Bell and was designed for consumers’ ease of use during price changes. In 2011, all domestic First-Class 1-ounce stamps became Forever stamps with the exception of stamps in coils of 3,000 and 10,000, and those formats were added to the Forever program in 2014. Forever stamps sell for the basic First-Class Mail 1-ounce price in effect at the time of sale.
In FY2016, the “Forever” stamp concept advanced one step further and extended this convenience to customers needing stamps for mailing items weighing more than 1 ounce as well as for postcards and bulky or odd-sized envelopes that require hand sorting. The new “additional-ounce” Forever stamps will always be equal in value to the applicable price for the price category printed on them at the time of use. Customers purchasing these Forever stamps can easily determine their use by the descriptions on the stamps: ADDITIONAL OUNCE, POSTCARD, NON-MACHINABLE SURCHARGE, TWO OUNCE and THREE OUNCE.
A Global Forever stamp was introduced in 2013, offering a single price for any First-Class Mail International 1-ounce letter to any country in the world. Global Forever stamps may also be used to mail a letter up to 2 ounces to Canada.
In FY2016, 42 new stamps were issued with 135 designs recognizing American history, culture, people and achievements. Some of the stamps issued — as part of the Postal Service’s annual stamp program — paid tribute to individuals diverse as Richard Allen, Jaime Escalante, Shirley Temple, Sarah Vaughan and Henry James. Other stamps issued included: Lunar New Year: Year of the Monkey, Botanical Art, Pets, Indiana Statehood, Star Trek, Wonder Woman, Pickup Trucks, Jack-o’-lanterns, Soda Fountain Favorites and Songbirds in Snow; and stamps released to support the once in a decade World Stamp NY 2016 included: World Stamp Show Folio, Repeal of the Stamp Act, Classics Forever, National Parks, Views of Our Planets, Pluto Explored, The Service Cross Medals and Colorful Celebrations; and all new holiday celebrations stamps included Holiday Windows, Diwali, Hanukkah, Kwanzaa, EID, Nativity, and Florentine Madonna and Child.
Of the stamp issuances, National Parks proved to be the biggest selling commemorative stamp issuance for FY2016 with over 27 million stamps sold. This was followed by our Black Heritage stamp honoring Richard Allen, Views of Our Planets, Legends of Hollywood’s Shirley Temple and our Music Icons’ Sarah Vaughan, all of which sold over 10 million stamps each. Flags were by far our most purchased stamps with 1.9 billion stamps sold, followed by stamps featuring flowers and holiday themes, with each sold over 250 million each.
The Postal Service also is authorized by Congress to issue semi-postal stamps that are used to help raise funds for designated causes. The price of a semi-postal stamp pays for the First-Class Mail single-piece postage price in effect at the time of purchase and reasonable reimbursement of costs to the Postal Service, plus an additional charge. This additional charge (or “differential”) helps fund causes designated by Congress, with money going to a congressionally selected executive agency or agencies. Four semi-postal stamps have been issued since the program began in 1998 resulting in the donation of $98.9 ($98.1+$0.5+$0.3) million. The two semi-postal stamps on sale in FY2016 were the Breast Cancer Research and Save Vanishing Species stamps.
The Breast Cancer Research stamp (1998-current) generated proceeds of approximately $500,000 in FY2016 and $83 million since it was first issued in 1998. By law, 70 percent of the amount raised is given to the National Institutes of Health and 30 percent is given to the Medical Research Program at the Department of Defense.
The Save Vanishing Species stamp (September 2011-current) generated proceeds of approximately $300,000 in FY2016 and $3.6 million in total since its 2011 release.
Stamp Services recognizes the importance of innovation and technology and has begun bridging the gap between digital and physical. This resulted in the development and release of the first official USPS StampApp. This new app leverages digital technology to include both a digital reference library — the U.S. Stamp archive as well as an interactive platform for users to browse the fully illustrated Postal Service stamp library. The StampApp allows users to manage their own personal collections, create and edit their stamp wish lists and share their collections with others. This mobile app is unique because it includes a pre-populated reference library of United States postage stamps.
In addition, we introduced the eBook edition of the popular Postal Service Guide to U.S. Stamps. This is the first-ever eGuide to U.S. Stamps accessible on your smartphone or tablet. The eGuide to U.S. Stamps includes all the contents within the hard copy book that we publish annually — which was the 42nd edition this year. The eGuide brings the power and beauty of stamp art to the screens of laptops, tablets and phones, where collectors can experience the majesty of U.S. stamps as never before. Along with stunning high-resolution imagery of the art of the Postal Service archive, from the Postmasters Provisionals of 1845 through the final issuance of 2015.
For more information about the Postal Service stamp program, visit www.usps.com/stamps.
Stamps to Go and Stamps by Mail – It’s never been easier to get stamps, whether at a Post Office, online at usps.com or at one of our retail partner locations. In FY2016, the Postal Service provided customers with access to stamps at more than 64,250 retail partner locations through the Stamps to Go program. Various marketing efforts are used to remind customers that U.S. postage is available through more than 600 partner companies. These efforts sustain stamp sales while expanding our retail footprint. The Contract Postal Unit program also continued to grow revenue and expand the reach of our stamp program through strategic partnerships. The Stamps to Go program made over $1 billion in stamp inventory available to customers through our retail partner locations in FY2016 and is one of our most cost-effective channels.
Customers, of course, can always take advantage of our Stamps by Mail program. Stamps are delivered through the U.S. Mail without delivery or handling charges. Our retail offices ordered more than 6.8 million brochures highlighting Stamps by Mail to circulate throughout their communities. This program remains popular with the elderly and disabled.
Promotions – The Postal Service encourages mailers to invest in new ways to use mail and engage their customers through annual promotions.
These promotions drive new business by encouraging companies to push the envelope on the way they deliver their direct mail messages. Over 33 billion mailpieces have been mailed through the USPS Promotions program since 2009. In calendar year 2016, the Postal Service launched several promotions designed to help marketers engage their customers by using dynamic color print mobile technology as well as traditional and innovative mail techniques.
- Earned Value Reply Mail (Apr. 1 to Jun. 30, 2016) – This promotion is designed to encourage mailers to promote First-Class Mail as a primary reply mechanism for their customers and to keep Courtesy Reply Mail/Business Reply Mail envelopes in their outgoing mailpieces by providing a financial benefit when CRM/BRM envelopes are used. Mailers who register their mailer identification information and use eligible Intelligent Mail barcodes on their reply pieces will receive a postage credit for each mailpiece that’s returned to the mailer during the promotion period.
- Personalized Color Transpromo (Jul. 1 to Dec. 31, 2016) – Since 2014, USPS has provided this promotion to encourage mailers of bills and statements to use color messaging in order to create a greater connection to and response from consumers. This promotion provides an upfront 2 percent postage discount to mailers who use dynamic/variable color print for personalized transpromotional marketing messages on their bills and statements. This approach is intended to continue to grow the value of First-Class Mail and encourage mailers to invest in color print technology.
- Emerging and Advanced Technology/Video in Print (Mar. 1 to Aug. 31, 2016) – The Postal Service continues to encourage mailers to integrate direct mail with mobile technology and now with video/print technology. Mailers can earn an upfront 2 percent postage discount on mailpieces that include the use of standard near field communications, or an “enhanced” augmented reality experience (augmented reality superimposes digital images or content over a live image of a mailpiece.) These mobile-based technologies allow the recipient to engage in innovative digital experiences triggered from their mailpiece. New for this year is the inclusion of Video in Print to generate opportunities that leverage new video technologies incorporated with a printed mailpiece.
- Tactile, Sensory and Interactive Mailpiece Engagement (Mar. 1 to Aug. 31, 2016) – Tactile, sensory and interactive mailpieces were included in the Emerging and Advanced Technology promotion in 2015. Due to its popularity, this year includes a new promotion focused solely on these applications. Advancements in paper, ink and interactive mailpiece elements provide marketers exciting new ways to enhance customer engagement opportunities. The engagement can be achieved through the innovative use of specialty inks, sensory elements, textural papers and the use of folds or other dimensional elements that the recipient can interact with and manipulate on the mailpiece. This promotion provides mailers with the opportunity to earn an upfront 2 percent postage discount by incorporating these features.
- Mobile Shopping (Jul. 1 to Dec. 31, 2016) – This promotion provides mailers with the opportunity to earn an upfront 2 percent postage discount by integrating mobile technology with direct mail. Using technology platforms such as Quick Response Codes, Snap Tags, watermarks and other advanced technologies, the consumer is launched from the mailpiece into online shopping experiences. This year adds social media opportunities through “buy it now” features highlighted to support shopping during social media activities. This promotion encourages mailers to adopt technologies that create consumer excitement and highlight the connection between the mailpiece and the digital shopping experience.
Every Door Direct Mail – Every Door Direct Mail service is an easy, cost-effective way for marketers to reach potential customers near their businesses. Using an online mapping tool available at usps.com, mailers can select individual postal routes for delivery to every household on those routes. They also can select demographic data in choosing routes. With EDDM Retail, customers can pay for and enter their mail at the retail counter using simplified mailing preparation. Customers may also choose to mail from a Business Mail Entry Unit (BMEU). Since its launch in April 2011, EDDM has generated over $2.2 billion in revenue and over 13 billion mailpieces from mailers across the country.
Market-Dominant Product Pricing and Classification – Our Mailing Services, which include First-Class Mail, Standard Mail, Periodicals and certain parcel services, account for approximately 74 percent of our annual operating revenues. Price increases for these services are generally subject to a price cap by class of mail based on the Consumer Price Index for All Urban Consumers (CPI-U). Our Board of Governors sets the prices, which are reviewed by the Postal Regulatory Commission. Prices for certain Mailing Services increased an average of 1.9 percent in May 2015, 1.7 percent in January 2014 and 2.6 percent in January 2013. Due to a very small CPI, there was not an overall CPI price increase in 2016.
Price Increases – In August 2016, the PRC approved price increases for First-Class Mail retail parcel prices for 1-, 2- and 3-ounce pieces. This price change was to address migrating volume from higher priced First-Class Package Services to lower priced First-Class Mail retail parcels that resulted from the rollback of exigent prices in April 2016.
Exigent Surcharge – In December 2013, the PRC ruled that the Postal Service could collect an exigent surcharge to recoup revenues lost due to the Great Recession’s impact on mail volume. The surcharge revenue is in addition to revenue that the Postal Service would generate solely from a price increase based on CPI-U. The PRC determined the value of this lost revenue to be $3.2 billion in incremental revenue, and $2.8 billion in contribution. The ruling also stated that when this revenue amount is reached the Postal Service must remove the surcharge from our prices.
As a result of the ruling, the Postal Service implemented a 4.3 percent temporary exigent surcharge on Mailing Services in January 2014. That same month, the Postal Service filed an appeal of the PRC ruling in Federal Court. In June of 2015, the Federal Appeals Court ruled in favor of the Postal Service’s appeal. They remanded the case back to the PRC to review the total amount of surcharge originally awarded. In their review, the PRC determined that the Postal Service was due an additional $1.4 billion in revenue. The new total incremental revenue target number for the exigent surcharge was $4.6 billion. On April 10, 2016, in compliance with the PRC’s ruling, once $4.6 billion in surcharge revenue was collected, the Postal Service rolled back the exigent surcharge to the CPI prices approved in May 2015.
