10 TIPS TO REDUCE THE RISING COST OF POSTAGE

Office Solutions, Apr 2007 by Maguire, Michael

Spend less and mail better!

In case you didn't know, the rate to mail a standard letter via First Class mail will increase from 39 cents to 41 cents this May. In addition, the U.S. Postal Service (USPS) has created a new pricing structure, called Shape-Based Pricing (see page 19). If your organization is like many organizations, you probably didn't budget for this midyear increase and may find yourself trimming back important direct mail campaigns. This doesn't have to be the case. In (act, when ^^· you make the commitment to mail smartly, not only will you reduce your postage expenditures, you'll also reach more prospects and customers. You can increase the speed at which your direct mail is delivered, while reducing the number of miss deliveries. How? Just follow these simple rules:

Rule #1: Consider Standard mail

Examine your mailpieces. Which pieces need to go via Pint Class mail? First Class is required for "transactionaT mail, induding bank and credit card statements, legal correspondence, and brokerage communication. Typically, Standard mail is used for catalogs, self-mailers, and other marketing mailpieces. Standard mail may bear a recipient's name, both inside and out, but the offer is available to many other recipients. For example, your bank sends your checking account statement to pu via First Class mail. The same bank may send pu an offer for a new credit card using Standard mail. The difference is that pur statement is relevant only to you, whereas the promotion is available to many. In some instances, Standard mail rates are 50 percent less than First Class.

Rule #2: Process your list with address-cleansing software

Processing your list through address-cleansing software will standardize the addresses, correct ZIP codes and spelling, and add ZIP 4 codes. Adding ZIP 4 codes is a necessary first step for taking advantage of many discount programs. All address lists used to produce mailings for automation rate discounts must be matched by CASS (certified address standardization software). Updates to the software are available monthly or bimonthly, and lists should be "re-cleaned" often as the USPS realigns addresses frequently.

Rule #3: NCOA your list twice a year

Your first question might be "What the heck is NCOA?" NCOA is an acronym for National Change of Address. You provide addresses to a USPS NCOA licensee who standardizes the list to conform to USPS requirements. Once an address has been standardized, the address is matched up against the NCOA File, which contains approximately 160 million records or 48 months of permanent address changes.

Address change information is derived from USPS Form 3575, Change-of-Address Order, filed by relocating postal customers. If an exact match is made with the old address information in the NCOA File, you're provided the new address information. NCOA helps reduce undeliverable mail by correcting input addresses before mailing.

Some mailing software vendors have embedded a similar postal product called NCOALink. This allows address updating right at your desktop without having to send your lists to an outside service bureau. Perhaps the biggest difference is that NCOA finds moves going back 48 months, whereas NCOALink looks back 18 months. This service has saved mailers millions of dollars that otherwise would have been wasted in materials and postage.

Rule #4: Use an electronic postal scale

If you're using a spring-loaded manual postal scale, you could be wasting 15 percent of the postage applied to single letters. That's what an independent study conducted several years ago found. It's no surprise. What do you do when the scale indicator is "on the line"? Most people post at the next higher rate because they want to be sure the letter gets delivered. An electronic scale is significantly more accurate and can be interfaced to your postage meter to automatically set the postage. This eliminates accidentally setting the meter for $4.20 rather than the 42 cents you intended.

Rule #5: Presort your mall-use POSTNET bar codes

In its most basic form, presorting means grouping your mail by ZIP code. All of the pieces going to the same destination get grouped into the same package or tray. Mail is first sorted to specific areas (five-digit ZIP codes), then to more general areas (three-digit ZIP codes). The leftover mailpieces are also grouped together. Because you're doing some of the work, it costs the USPS less to process and deliver the mail. Those savings are passed on to you in the form of postage discounts.

The easiest and most accurate way to presort is using a PAVE-certified presort software program. Just as the USPS has a certification process for address cleansing, it also has certification for presort software as well. A presort program will also make it easy to generate the postal bar code, a requirement for automation discounts. The bar code is a symbolic representation of the ZIP 4 code and some additional address information. The combination of address cleansing, presorting, and bar coding provides the greatest discounts.