postage optimization: take a fresh look

2014 Enterprise Client Summit

2014 EnterpriseClient SummitUnlock the Value ofYour Communications

2014 Enterprise Client Summit

Postage Optimization:Take A Fresh Look

Bruce Gresham Eric KemptonPB Presort Services PB Marketing

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Why take a fresh look at postage spend?

Postage accounts for 70-80% of final mail piece costFor every penny you save in postage, that is up to 5% you can add to your marginPostage: pass through vs. profit center• Strengthen

relationships• Rebates go to bottom

line

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Mail Piece Design

Data Analysis

PrintProduction

Inserting Mail Sorting

Mail Piece Lifecycle

Postage savings and workflow optimization can be gained during each stage of composition and production:

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Mail Piece Design

Mail piece design has a great impact on rates • First Class or Standard Class• Size, weight & paper stock options• Letter, self-mailer, postcard

– A 5”x7” postcard costs the same as a 6.125” x 11.5” postcard

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Mail Piece DesignAutomation compatible• Use Fonts between 10pt and 14pt• Black text printed on white

background• Avoid script, bold and narrow fonts• Avoid glossy stock for the envelopes

or glossy card stock for postcards

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Mail Piece DesignConsult with your printer• Size matters• 2-up, 4-up or 8-up• How many pieces can be

combined on a sheet?

Other Considerations• USPS Incentives• 2nd ounce rides free

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Additional Resources

PB Customer Guide Mailpiece DesignDirect Mail Manual (DMM)

www.usps.pe.comRapid Information Bulletin Board System (RIBBS)

www.ribbs.usps.gov

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Data Analysis

Optimization Enablement tools:• Manifest Software• Predictive Presort• One Pass Solutions

House-holding

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Mailing Compliance

Mail Piece Lifecycle Tracking• Track pieces from

composition through out for delivery

• New mailing regulations: Consumer Financial Protection Bureau, Affordable Care Act, etc.

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Print Production

Make mailing part of your printing specificationsConsider the following:• Stock matters

– Do you really need 100# cover?– Ask if there is a “House” stock– Price fluctuates among brands

• Varnishes and coatings

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Data + Print Production

Variable/personalized printing

+

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Inserting

Automate manual tasksMeet SLAs fasterAchieve the lowest cost per thousandIncrease revenue with a wider range of applications

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Data + Printing + Inserting

++

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Mail Sorting

In-housePresort Services providerHybrid Strategy

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Mail sortation

Thinking beyond throughput

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Existing Batch Read Rate

Improvement

99% - 95% 1.50%94% - 90% 4.60%89% - 85% 7.70%84% - 80% 9.90%79% - 70% 12.90%69% - 60% 17.60%59% - 40% 18.20%

0.00%2.00%4.00%6.00%8.00%

10.00%12.00%

14.00%

16.00%

18.00%

20.00%

99% -95% 94% -

90% 89% -85% 84% -

80% 79% -70% 69% -

60% 59% -40%

Platinum Recognition

Existing Batch Read Rates

OCR Technology and sorting performance

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OCR Read Rate impact on your businessClient inputs:

Volume = 120,000/day90% Current Read rate 5% Read rate improvement Discount Class Distribution– 65% 5 digit– 20% 3 digit– 8% AADC– 7% MAADC

Yields over $100,000 Annually !

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* Example based on postage for 120,000 letter pieces per day, meant for illustration only. Does not include additional labor costs for manual handling of mail which is not resolved via sorter.

OCR Read Rate impact on your business*

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OCR Read Rate impact on your business*

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Presort Services Provider

What to look for:• USPS Full Service compliant• Security for payables• National footprint• Delivery improvement

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Mail Exchange

Transport mail volume for targeted ZIP Codes to specific Operating Centers for final processingImproved delivery standards Thorough analysis of the mail volume at PBPS locations, in addition to a review of USPS service standards

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Industry Trend

Take a Hybrid Approach:• Direct present best qualifying mail via manifest

software or MLOCR sorter• Outsource residual mail

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Business Mail Bundling

A new service for Presort Services clients• PBPS processes your jobs as normal, bundling

any mail that is sent to the top 500 Delivery Point zip codes. The majority of these Delivery Points tie to a business address that is typically a payment lock box center, hospital or insurance processing site.

• Your mail will be bundled within Priority Flat Rate boxes with other major mailers.

• A note to the package recipient will explain mail was bundled from several companies to enhance the delivery experience.

• For permit mail only.

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Mail Piece Design

Data Analysis

PrintProduction

Inserting Mail Sorting

Look at the entire mailpiece lifecycle as a whole• Each step in the process is related to another• Maximum optimization is achieved when all components are

aligned

Putting it all Together

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Questions?

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Contact Information

Bruce GreshamVP Business Planning & StrategyPB Presort ServicesBruce.Gresham@pb.com704.726.6728

Eric KemptonSortation Solutions Marketing

Pitney BowesEric.Kempton@pb.com

203.796.3955

2014 Enterprise Client Summit

Thank You

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Appendix

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USPS Incentives – 1 of 3

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USPS Incentives – 2 of 3

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USPS Incentives – 3 of 3