Cost
Madison Avenue Flirts With 3-D
According to the Wall Street Journal, “Papa John’s International, the U.S. Postal Service and General Electric have begun to incorporate “augmented reality,” or AR — a technology that lets consumers interact with hologram-like images — into their marketing. One well-known example of AR: the yellow first-down lines in TV broadcasts of football games. This week, the Postal Service will start running an ad campaign that touts a flat-rate shipping fee for its Priority Mail service. The online portion of the ad effort includes a “virtual box simulator” on the prioritymail.com site. The simulator allows consumers to hold an object, such as a cup or a book, in front of a Webcam and use the resulting 3-D image to determine the right size box for shipping the object. The push into AR comes as companies have grown dissatisfied with relying solely on static advertising or passive media like TV commercials, which have washed over coach potatoes for years. In pursuit of alternatives, they have pumped money into approaches that encourage consumers to “engage” with their message or product, something ad executives believe helps increase sales.”
Summer Postage Sale – well, sort of a sale, no, more like a small rebate
summer sale
To those that are excited about the impending summer postage sale, there are a few details you need to know, first, did you receive a letter from the USPS recently?
Here is what it looks like: summer-sale-electronic-letter
Here are the details:
The USPS has made it official (almost) that they are going forward with the proposed ‘Summer Sale’ event. The PRC must still weigh in with their decision, which is expected in late May, to make this program official. This program would provide a 30% postage credit on mailings submitted between July 1, 2009 and September 30, 2009. This incentive program is designed to increase mailing activity during the usually dormant summer months, when the USPS has their most excess capacity available.
Unlike most sales however, there are a multitude of qualifiers that apply to the Summer Sale.
Who and what qualifies?
For the most part, the USPS has already determined what mailers qualify. Letters were sent out on 5/7/09 to approximately 3,200 mailers whom they determined will be eligible for this program by utilizing the mail volume data that exists within their internal system.
1. This program only applies to Presorted Standard letters and flats.
2. The next qualifier is that you must have mailed a minimum of 1,000,000 pieces during the time period of October 1, 2007 and March 31, 2008. Total volume is calculated by mailer, so even if you utilize multiple permits, your total volume will be calculated across all permits that are associated to your organization. This also applies to “Ghost Numbersâ€, which are created if your mail is sent through a Mail Service Provider. If you feel you are eligible, but have not received a letter, then you can request a contact by emailing your information to summersale@usps.gov.
If you have met the criteria above, you are ready to begin to calculate the ‘Sale’ portion of the program. The 30% postage credit will be given only on the number of mail pieces that exceed your mailing threshold for the time period of July 1, 2009 to September 30, 2009. The caveat to this all is that your mail volume in October must not fall below your mailing threshold for that month. If this occurs; the total credit accrued from mailings between 7/1/09 to 9/30/09 will be deducted by the amount of pieces that fell below the threshold in October and that will be the final credit. The credit will be issued at some point in December of 2009 once the USPS has completed the above calculations.
How to calculate your potential savings:
Below is an example of how to calculate the savings that you as a mailer may receive through this program. Listed in this example is the all important Threshold, which will be the key to planning your mailings to take advantage of this program.
1. Base volume (7/1/08 – 9/30/08): 500,000 pieces
2. Trend:
a. Volume 10/1/08 – 3/31/09 = 1,800,000 pieces
b. Volume 10/1/07 – 3/31/08 = 2,000,000 pieces
c. a/b = (1,800,000 / 2,000,000) = .90 or 90%
3. Base x trend = Threshold:
500,000 x .90 = 450,000
4. Rebate = (Actual volume – threshold) x (actual postage cost / actual volume) x 30%
a. Actual volume for 7/1/09 – 9/30/09 – threshold =
475,000 – 450,000 = 25,000 pieces
b. Actual postage cost / actual volume =
$103,075 / 475,000 = $0.217
c. Rebate =
25,000 x $0.217 x .3 = $1627.50
The October Effect:
It is important to keep your mailing volume for October in mind when factoring the potential savings. If your volume falls below the calculated threshold, then your overall credit will be impacted. Below is an example of how to calculate this effect.
a. October 2008 volume x trend (in #2 above) = October threshold:
300,000 x .90 = 270,000 pieces
b. If October 2009 (260,000 pieces) < October threshold:
Threshold – actual = adjustment
270,000 – 260,000 = 10,000
Rebate adjustment
a. Actual volume – summer sale threshold – rebate adjustment:
475,000 – 450,000 – 10,000 = 15,000
b. New rebate:
15,000 x $.217 x .3 = $976.50
For those of you that have received a letter; be sure to certify the volume that the USPS has provided to you since this will be a binding once you have agreed to enroll in the program. Also be sure to have your response in by August 1st, 2009.
This program is a great way to potentially reach more customers at a lower cost and therefore enhance your business’ ROI. The system is not perfect, but it is a step in the right direction for the USPS to utilize their new found pricing freedom to help mailers.
From the Federal Register today:
Federal Register Notices
DATE: Pending publication in the Federal Register.
Standard Mail Volume Incentive Program (aka Summer Sale)
AGENCY: Postal Serviceâ„¢.
ACTION: Final rule.
SUMMARY:
The Postal Service is revising Mailing Standards of the United States Postal Service, Domestic Mail Manual (DMM®), to add section 709.2 which introduces new standards for a special volume incentive program for mailers of Standard Mail® letters and flats with mail volume exceeding their individual USPS™-determined threshold levels. The program period will be from July 1, 2009 through September 30, 2009.
EFFECTIVE DATE: July 1, 2009.
FOR FURTHER INFORMATION CONTACT: Kevin Gunther at 202-268-7208.
SUPPLEMENTARY INFORMATION:
The Postal Service is implementing a volume incentive program for qualified high-volume mailers of commercial or Nonprofit Standard Mail letters and flats, for volume mailed between July 1, 2009 and September 30, 2009, above their USPS-determined threshold level. This program encourages mailers to provide new volume and to take advantage of our current excess capacity to process and deliver additional volume.
Fred Smith Talks Green: Helps the environment and Fedex’s bottom line
BILL DRIES | The Daily News
Fred Smith is going green. In the case of the FedEx founder, however, it’s a different shade – something like military fatigue green.
Smith is reframing the push for alternative fuels and energy from a discussion of “what ifs†to a national security issue.
Electric vehicles and biofuel incentives are part of a plan Smith admits is controversial. It includes nuclear energy, a carbon tax and maxing out domestic oil exploration.
Smith is co-chairman of a coalition of corporate executives and retired military generals called the Energy Security Leadership Council. The other co-chairman is retired general and U.S. Marine Corps commandant P.X. Kelley.
In two speeches this year, one at the National Press Club in February and the other to a conference at the University of Memphis last month, Smith continued the ESLC bid to set specific goals for American energy independence and take the green movement from theory and individual practice to national policy.
After terrorism and nuclear proliferation, Smith and the council rank the nation’s dependence on foreign oil as the “largest national security risk in front of the United States.â€
Smith and Kelley wrote a column for The Washington Post in the summer of 2006 that began with a question.
“Could a mere 4 percent shortfall in daily oil supply propel the price of a barrel to more than $120 in a matter of days?†they wrote. “Such a rapid rise in fuel costs would have profound effects that could severely threaten the foundation of America’s economic prosperity.â€
Two summers later, they turned out to be off the mark by only $27 a barrel.
“People forget that while subprime mortgages and CEOs and all of these other risky instruments and problems with Fannie Mae and Freddie Mac and all of the other things you’ve read about were the bonfire that’s consumed our economy, the match that lit it off was $147-per-barrel oil, which reached its peak last July,†Smith said at the April 20 supply chain conference at the University of Memphis’ FedEx Institute of Technology. “Each of the five major recessions since the first oil embargo in 1973 have been coincident with a significant hike in fuel prices.â€
Toward the end of the Bush administration last year, the ESLC was instrumental in helping win passage of the first increased standards for fuel efficiency in cars in 20 years.
“We spent 20 years from the last time the country increased fuel efficiency standards, which all of my free market friends argue against with me,†Smith said. “Nobody is more free market than I am. FedEx is a creature of deregulation. … This is not purely an economic issue. It’s a national security issue.â€
Interests to protect
The five recessions and the five corresponding spikes in fuel prices span the life of FedEx, the cargo innovator Smith founded in Little Rock in the early 1970s and that, soon after, moved to Memphis.
FedEx uses a lot of oil in its air and ground operations. The company has almost 700 aircraft in its entire operation and runs more than 80,000 vehicles of different types, Smith said. Aviation is the most energy intensive use FedEx has.
FedEx Executive Vice President William J. Logue told a U.S. Senate committee in 2007 that FedEx Express alone consumed more than 1.3 billion gallons of fuel in fiscal year 2006.
And Smith said that has propelled the company’s own quest through the years to find and even encourage research and development of more fuel-efficient vehicles as well as those that use alternative fuels.
The speech at the University of Memphis was the first part of an unusual two-day set of public comments from Smith. The next day he attended an executive session of the Memphis City Council at the council’s invitation. The council solicited Smith’s advice on how government could operate more efficiently.
His answers to those questions were specific and he was careful not to stray far from the questions.
Smith’s remarks on green as a national security issue were heavy on specifics even though Smith was talking extemporaneously.
“Over half of our $600 billion-plus military budget every year is spent for the sole purpose of protecting the oil trade,†Smith said as he noted complaints about the cost of a carbon tax, which he favors. Smith said there are no similar concerns about “having to have a military establishment of the size that we have that’s gotten us involved in two wars in the Middle East, which is almost exclusively because of our dependence on petroleum coming from that part of the world – not totally – but almost exclusively.â€
Smith, who backed John McCain in the 2008 GOP presidential primaries, even went back to the 1950s Eisenhower administration benchmark that set anything above a 20 percent dependence on foreign oil as a “grave national security risk.†That dependence is now at 60 percent.
“That might be in a perfect world not a problem. But we don’t live in a perfect world,†Smith told the group of about 100 people at the University of Memphis. “And, unfortunately, contrary to a great deal of what you hear about in terms of the oil business, it’s not our great integrated oil companies like Chevron and Exxon who control most of the oil.
“Ninety-percent of the proven oil reserves in the world belong to national oil companies. And many of those national oil companies are outright hostile to the United States, or at least indifferent to our standard of living and our national interests.â€
An electric plan
Smith’s suggestion as well as that of the leadership council includes a goal of converting the nation’s short-haul commercial vehicle fleet to electrically run cars and trucks. That goal also would include personal cars and trucks.
“The United States should as a matter of national policy move toward a largely electrified short-haul transportation system,†is how Smith put it.
In a February speech at the National Press Club in Washington, Smith said electrification would be a “sea change†made possible in part by technological advances in the past 25 years that have given longer life to batteries. But he said the transition still will be difficult.
“We cannot encourage the purchase of electric cars and then not have the generation capacity to power them, the transmission capacity to deliver that power to the consumers who need it, or the smart grid technology that will be required to handle those cars as we plug them in and out of the grid,†he said.
At Syracuse University in New York, Patrick Penfield has been writing for several years about the emergence of this turn in the green movement.
“In the next several years, you will be hearing more about supply chain sustainability or the green sustainable supply chain,†he wrote in August 2007.
The assistant professor at the Whitman School of Management at Syracuse also cast the validity of the move in different terms.
“The whole idea of a sustainable supply chain is to reduce costs while helping the environment,†he wrote.
It’s no accident that reducing costs is mentioned first.
On the second day of the green supply chain conference at the University of Memphis, Mike Bruns, the president of Memphis-based Comtrak Logistics, said lower fuel consumption is at the root of green considerations for him and others in the freight business.
“I guess I could sit here and tell everybody that I’m a real believer in green – and I guess I am,†Bruns said. “But I’m really a believer in making money. And it’s generally interesting that everything we’re doing to make some money at Comtrak has everything to do with being more green.â€
At the same panel discussion, Mark Schulze, a vice president of BNSF Railway Co., one of the city’s major rail presences, was more direct.
“I haven’t seen one decision made yet that was environmentally based,†he said. “It gets down to cost and on-time performance. … But there is a mandate to lower our diesel fuel consumption, which will benefit us with (fewer) greenhouse gas emissions.â€
Price-driven alternatives
Penfield told The Memphis News that converting to such a green supply chain will be “long and arduous.†He also said interest and commitment could wane in direct relation to the price of gas.
“When gas prices are high, there’s actually a benefit to the greening of the supply chain,†Penfield said. “When gas prices are low, that whole impetus is taken away. Nobody wants to talk about it. Nobody really wants to figure out ways to help the environment.â€
Smith, however, saw differences in last summer’s gas price spike. There was the part that China and India played in upping the demand for gasoline.
“Prior to last summer’s run-up, you could anticipate that the crisis would come, demand would go down and you’d come back and to some degree it would be business as usual,†Smith said. “On the supply side, there really was little alternative to the continued consumption of fossil fuels. But in the interim … the development of battery technology fueled … by the proliferation of laptops and PDAs and cell phones has created a whole new generation of batteries that have the amount of storage that will allow the daily use of a personal automobile to be tolerant by batteries.â€
That means traveling 40 miles on a single charge.
FedEx teamed with the Environmental Defense Fund in 2004 to launch the first commercial hybrid truck. Smith calls it a PUD – pickup and delivery vehicle. It’s a step-in delivery van that has 700 cubic feet of space. It is 42 percent more efficient than diesel-powered delivery vans and its emissions are 90 percent less. The FedEx fleet uses 300 of them.
“The problem with the vehicle is it is more expensive than the conventional diesel,†Smith said.
It’s more expensive by about $30,000.
“When the price of fuel was up to $4 or $5 per gallon for diesel, you actually were getting close to getting a reasonable return on investment for that,†he added. “But as fuel has come back down – and it will go back up in all probability – it’s very hard to justify.â€
Victoria Mills, the managing director of the EDF’s corporate partnerships program, said the FedEx request for proposals on the hybrid trucks was nevertheless an important step.
“That’s where the transformation started,†she said. “Then within two years, no fleet trade show was complete without a hybrid offering.â€
By the EDF’s count, the 300 hybrid PUDs FedEx has are among 1,200 hybrid trucks either on the road or on order in North America. The FedEx fleet of hybrids is one of 85. And there are 36 makes and models.
“What we’re seeing is not just rising orders, but a diversification in the marketplace,†Mills said by phone from Boston. “That reflects confidence in the technology and a much broader trend in business to address climate change.â€
Seeking a standard
Penfield said at least for now, the diversity has a downside as well.
“We want to move to batteries. But these different automobile manufacturers are all using different batteries,†Penfield said. “How do you charge it up?â€
Penfield talked about charging stations for battery powered vehicles being used in Israel in which motorists simply swap spent batteries for newly charged ones.
“The problem is getting everybody to use that battery,†he said. “That’s an issue. There’s no standard. … Nobody has a path to follow.â€
Smith told the National Press Club in February it’s important that whatever standards are set for a national grid don’t create a new dependence on imported technology.
“The investments – private and public – involved in electrification could have a tremendous positive effect on the American economy – if we do everything in our power to encourage the creation of new manufacturing capacity and jobs here at home,†Smith told that gathering. “That means, among other things, reducing the corporate tax rate and changing the tax code to allow the expensing of capital equipment. If we are going to drive battery operated cars, let’s make sure that as many of them as possible are built here in the United States.â€
Mills concedes Penfield’s point about the impact changing oil prices have on the demand for hybrids as well as the expense of hybrids at this point.
For business owners who run or manage fleets of vehicles, the main issues are if the new additions to the fleet pay for themselves and over what period of time.
Mills and Smith agree that until the gap in price between conventional short-haul vehicles and the hybrids is bridged, government incentives are essential.
“The difference between having incentive help and having no incentive help can be five to 10 years off the payback of one of these trucks,†she told The Memphis News. “New York, for example – their program will fund 80 percent of the incremental cost of a hybrid truck. At the federal level, money from the stimulus bill has gone into what is called the Diesel Emission Reduction Act (DERA).â€
The DERA regulations have spun off a business of organizing hybrid or alternative-fuel fleets for companies integrating them into their overall fleets and capturing the federal incentives.
Tennessee Gov. Phil Bredesen took a test drive last month in an electric car made by Nissan. The Japanese carmaker with a Tennessee presence plans to begin selling such cars for commercial and government fleets in the U.S. next year.
Bredesen has proposed a network of public charging stations for electric cars in a partnership that would involve state and local governments as well as carmakers. At the test drive, he also talked of research on solar-powered charging stations in Nashville, Chattanooga and Knoxville. Bredesen said he hopes to garner some of the federal stimulus funds for the effort.
California recently enacted a voucher program for short-haul vehicle fleets that contributes $10,000 to $40,000 per vehicle for new hybrids.
“Over the road†longer-haul trucks remain problematic if the goal is no diesel fuel.
“We don’t see in the near term any technology that will displace the use of diesel power plants,†Smith told the Memphis audience. “But we have many initiatives to reduce the energy consumption of our over-the-road vehicles.â€
Hybrid technology for over-the-road vehicles still involves using conventional diesel fuel, Mills said.
“That was originally the last place people thought to look for hybrid applications,†she said. “But, in fact, Walmart has been testing out some hybrids in long-haul applications, just because when you drive that many miles, smaller percentage gains in fuel economy add up to huge cost savings.â€
In one case, the hybrid part “simply captures the energy from braking and stores it in a battery where it can be used to supplement energy from the diesel fuel.â€
Here to stay?
For all of the technological changes being explored and garnering attention as well as financing for now in the corporate world, Smith said oil isn’t going to vanish as the fuel that runs America.
“It’s unrealistic to think that the demand for petroleum is going to decline from 80 million barrels per day or thereabouts, which it was last summer, and go to the point where petroleum is going to be irrelevant,†he told the Memphis audience last month. “We should be producing the maximum amount (of oil) that we can in this country.â€
It is a point in the leadership council’s set of recommendations that he admits, “We don’t get as high a grade on … from environmentalists.â€
Smith said an “enormous amount of resources†beneath the outer continental shelf could be produced in an “environmentally sensitive†way.
He also said, “Nuclear energy should be a huge part of the equation,†noting the use of nuclear power at FedEx’s facilities in Paris, France. “It’s the only completely emission-free power source.â€
Penfield isn’t so sure about the future of petroleum.
“I think eventually something is going to happen where it will be a pretty dramatic situation,†he said. “There’s going to come a point in time when we do run out. With the population increasing the way it is and these different countries booming, it’s going to be very, very difficult to attain the stuff.â€
He sees a “tipping point,†or point at which the research and development of green alternatives becomes a direction for corporations in possibly the next two to three years, with some important questions still to be answered in the research.
“Does it make sense to switch? Does it make sense to change the infrastructure? If prices of gas are low, it’s going to be a hard thing to convince people to switch. It really is. I hate to say that,†Penfield said.
Mills has a different view.
“I believe we’ve reached that tipping point and gone beyond it,†she told The Memphis News. “I believe that people have internalized expensive and fluctuating fuel prices as a business risk that they need to manage. I believe that people are seeing environmental innovation and efficiency improvements are going hand in hand – getting them where they need to be to address security objectives, to address climate objectives, to address business objectives.â€
Two Maine newspapers test the future of newspapers’ web plans
Richard Anderson, publisher of Village Soup
By Galen Moore of MHT, The Journal of New England Technology
Competing business models to save the newspaper industry are breaking ground not in Boston or New York, but in Down East Maine, as two local publishers try web-based strategies that couldn’t be more at odds.
Village Soup Inc., a chain of four local papers with headquarters in Rockland, last year blurred the line between advertising and editorial by letting local merchants pay to post their blogs on its Village Soup family of websites.
Last month, the Ellsworth American took a turn in the opposite direction, replacing its online presence with a site called Fenceviewer, which features summarized versions of the paper’s articles. The full Ellsworth American is available weekly as a PDF download to those willing to pay a $32 annual subscription.
“Beginning around the first of the year there was a swelling of opinion inside the news industry that we couldn’t continue to give it away for nothing,†said Ellsworth American publisher Alan Baker. The company toyed with a micropayment strategy, as had other newspaper sites nationally at the time. But in the end, Baker said, “We decided we’d hold our nose and jump.â€
Nationally, the newspaper industry is desperate, grasping at straws such as e-book readers to make up for plummeting print ad revenue. Yet in the microcosm of small-town Maine, local newspapers are trying new strategies — and one publisher has an idea he hopes to export nationwide.
Village Soup, which also has a paper in the state capital, is now under contract to expand its online model to five newspapers in Alabama and New York state via a software-as-a-service model hosted on virtual, cloud-based servers. Village Soup publisher Richard Anderson claimed that his strategy is already a success, saying the sponsored blogs generate 19 percent of the company’s $2.5 million annual ad revenue, according to a May 1 piece he wrote on the media blog Reflections of a Newsosaur.
In Anderson’s model, advertisers pay to blog, and their posts appear under a home-page “bizBriefs†column with a headline and a byline that look exactly like news articles. BizBriefs posts are supposed to be confined to informative postings, and many do — like a mortgage broker’s post on Federal Reserve Board Chairman Ben Bernanke’s comments, or sewing tips from a fabric store. About 600 people clicked on a local dentist’s post about the dangers of oral piercing, Anderson said.
The click-throughs for display ads don’t compare, he said. “Banners and buttons, no matter how closely you target the content … it’s difficult to get people to read what you have to say.â€
It’s a strategy that makes sense, said Dharmesh Shah, chief software architect and founder of Cambridge-based Hubspot Inc. According to Shah, when businesses post informative content, web users tend to find it and click on it. However, the model may be difficult to duplicate outside Village Soup’s hyperlocal context, he said.
Community businesses likely to blog on a newspaper’s site are very aware of who’s reading and why, he said.
“When you narrow the focus and most people know the individual/business posting, you’re less likely to be an idiot,†Shah said in an e-mail. “It would be like walking into a neighborhood cocktail party and starting to scream about the new promotion you’re having at a car dealership. It just wouldn’t work.â€
The Ellsworth American’s payment strategy serves an even narrower niche. From 12 percent to 15 percent of its subscription revenue is in mail subscriptions — typically snowbirds who get the paper by mail during winter months. Problems with the postal service have taken their toll.
So far, about 100 readers have subscribed online, said Chris Crockett, the paper’s IT manager, but it’s still early in the process. There have been “some comments,†about the new model, he said, but many people have been satisfied to be pointed to the paper’s trimmed-down free site.
“This is such an interesting time,†Baker said. “We are optimistic. We think this is an opportunity for us, with the economy soft.†The subscription downloads may cost more, but they offer more: they are searchable and include ads as they appear in the print edition, he said. “We want to come out of this recession with an even stronger business model than we had going in.â€
USPS: Ve Haf Vays of Making You Use Our Barcode
Wednesday, May 6, 2009 From the Dead Tree Edition
The Postal Service’s Intelligent Mail program might fail because it is not sufficiently attractive to mailers, the Government Accounting Office warned today.
Not to worry, the Postal Service responded. If the tiny Intelligent Mail barcode (IMb) discounts scheduled for later this year are not enough to entice mailers, it said, two years from now the huge penalties for not using IMbs will force mailers to change their ways. Starting in May 2011, mail without IMbs will be ineligible for automation discounts, which typically are at least several cents per mail piece.
“Some mailers have said they find the pricing incentives insufficient to recover their investment in the program,” said the GAO report. “For example, some large mailers said they invested millions of dollars to update and purchase hardware and software, while some smaller mailers expected to invest tens of thousands of dollars.”
Other highlights of the report and the Postal Service’s response:
The Intelligent Mail program “lacks a comprehensive strategy” that includes a detailed plan or “goals and measures of success”, the GAO said. The Postal Service agreed to beef up its planning but said the approach recommended by the GAO would drag out implementation too long.
“USPS and mailers may not be ready for implementation given USPS’s short-time period in which to simultaneously design, develop, test, and implement the Intelligent Mail program,” the report said. Amen to that!
An odd statement from the Postal Service: “Despite an extremely compressed schedule, the successful implementation of the Operating System environment on May 11 and the Test Environment for Mailers on May 18 demonstrates how well this effort works.” May 11 and 18 haven’t occurred yet, and mailers are reporting that the Postal Service is not ready for those key dates. See “Another Delay for Intelligent Mail?”
USPS “lacks information on costs and savings attributable to the Intelligent Mail program,” the GAO said. USPS responded that the program will give it valuable information enabling it to become more efficient but that “there is no sound financial method to specifically attribute these reductions to Intelligent Mail.”
“According to USPS, Intelligent Mail is the most complex project it has undertaken,” the GAO report said.
Postal detectives crack the case of messy, missing addresses
Barbara Trumpp (bottom center) and Arlene Jones (bottom right) process mail at the United States Postal Service Glendale Remote Encoding Center.
The Arizona Republic
Without leaving their cubicles, U.S. Postal Service sleuths in Glendale solve more than a million mail-delivery mysteries daily for post offices nationwide. Their wits and their computers are their only tools.
Is that a 3 or an 8? Senvisa or S. Envisa? Is a letter addressed “FCCI, Georgia” intended for the southern state’s FCCI Insurance Group in Duluth? Because it could be meant for the Floyd County Correctional Institute in Rome or the Fellowship of Companies for Christ International in Atlanta.
Sloppy handwriting and incomplete addresses, it turns out, almost succeed where snow, rain, heat and gloom of night fail in staying mail carriers from completing their rounds.
But those hard-to-read addresses usually don’t slow carriers because data-conversion operators using their best detecting skills are at work around the clock at the USPS Glendale Remote Encoding Center, save for the 10 hours it’s closed on Sundays.
The Glendale center is one of five in the United States – there were 55 when the postal service opened them in 1995 – devoted to interpreting scrawls and squiggles, blurs, smudges, missing information and otherwise ambiguous addresses.
In other words, the stuff that stumps the postal service’s sophisticated optical character-recognition software.
“This work makes me take a few extra minutes when I address my own envelopes,” says Debra Napier, one of more than 700 data-conversion operators, called keyers for short, employed at the site.
She’s seated in the midst of long rows of cubicles in a room adorned by little more than signs with U.S. cities’ names. Her eyes rarely stray from her computer.
Electronic images of envelopes sitting in 41 mail-processing plants across the U.S. flash onscreen, one after another, calling on her ability to decipher the shaky handwriting of a letter writer with arthritis or to see past the stickers obscuring an address. Twelve years as a teacher prepared her well for this job.
Napier also has learned a thing or two along the way. When addressing Christmas or birthday cards, she painstakingly prints rather than writing in cursive. She uses white envelopes even for Christmas cards, because addresses are hard to read on dark backgrounds. And forget silver ink.
Although most of the mail that keyers puzzle over is hand-addressed, they also see pieces printed with ink cartridges long overdue for replacement or displaying printer-produced addresses haphazardly positioned on envelopes.
In most cases, a machine at a mail-processing plant reads the address on an envelope, sprays on an ink barcode and sends the envelope on its way, keyer Steve Karr says. When the machine fails to read the address, an electronic image of the envelope is sent to a remote encoding center.
In the Glendale facility, the fastest keyers, like Karr, may handle an eye-blurring 900 to 1,000 images in an hour. Keyers succeed with as many as 75 percent of the pieces they process, says Chuck Van Dyke, manager of the Glendale Remote Encoding Center.
Aided by the postal service’s more than 2 petabytes of online data (think 4,000 years-plus of songs on your MP3 player), keyers examine the slightest clues – two digits of a ZIP code, a street name without house numbers, the first letter of a state abbreviation – and draw conclusions.
Postal abbreviations for four states start with an “A.” That letter coupled with a ZIP code beginning with 8 tells keyers the mail should go to someone in Arizona, not Alabama, Alaska or Arkansas.
Kerr, with 13 years on the job, peers at his screen and sees a sliver of a number, determining what it is based on its position between other numbers. On another envelope, he notices that a sender who inadvertently reversed positions for the mail and return addresses has scrawled arrows to indicate the mistake.
The goal is turning around each piece in no more than 20 minutes, Van Dyke says.
But the process usually is far speedier. As staff members work, they’re thinking about the child eager for a birthday card or the person looking for her W2 form so she can file her income-tax return.
“Back at the plant that has the indecipherable letter, there’s a truck getting ready to carry the mail,” Van Dyke says, “and it leaves by 10 p.m. local time. The times are lined up on the computer so keyers can see which of the pieces of mail they’re working on are becoming critical timewise.”
Such scenarios occur less frequently these days. Advances in technology have made the postal system’s optical scanning equipment capable of reading 95 percent of handwritten envelopes, up from 2 percent when the centers opened, Van Dyke says.
With demand for their work decreasing, three of the remaining remote encoding centers will be closed, the Glendale facility in May 2010.
Still, even the most advanced optical scanning and the best efforts of data-conversion operators fail at times to divine a letter’s destination. Then, once more, a human must intervene.
A letter addressed “Jane Doe, Second House Around the Corner from the Barber Shop, St. Peter, MN”?
That will go to Minnesota, where a mail carrier in the small town of St. Peter knows exactly whose mailbox to tuck the letter into.
Redplum mailer lets marketers dissect why some mail practices are not ideal
Redplum coupons
From the May 04, 2009 Issue of DMNews
Scott Couvillon President of marketing, DukkyMay 04, 2009
In critiquing this mailer piece from Redplum, we also can examine the direct mail practices we see every day that crush any chance of significant redemption and contribute to the definition of “junk mail.” 

First, the format: How did you feel the last time you stood in the center of a crowded tourist destination with a flag-sized street map unfurled in your hands? This is a similar badge that coupons carry. It is part of the reason why gift cards, according to two studies recent studies, redeem 10% to 30% higher than coupons with an identical offer. Gift cards have a perceived value that coupons lack, and personalization only increases the perceived value. And, anonymous coupons sent to someone name “resident” lack any perceived value. 

Therefore, to improve the format of the piece, I’d like to see more personalization, less anonymity. Also, the structure of this Redplum mailer makes capturing redemption information difficult. The model allows for customer engagement, but doesn’t give them a reason to. 

Next, the analytics: Coupons like these, are sent out en masse. Redemption is typically reported through a clearinghouse or a point-of-sale system after the fact. Whatever the case, this process can fail to capture significant amounts of information. While too long to list, two fundamental failings that stand out are which specific recipients redeemed and who was interested, but never got around to it. 

Finally, the relevance: While you could argue that saving money and pizza are universal constants, there is no predictor that the brands represented in this piece will benefit. A significant flaw with any saturation mailing, and a reason for lower redemption rates, is that there is no effort made to match the right offers to the right people.

Any offer that lacks relevance and perceived value could be seen as inefficient. More contemporary solutions should take these lessons, apply more advance targeting technology and offer marketers equal economy with far greater returns both in revenue and feedback. 

The bottom line is not to abandon direct mail, but to improve your direct mail investments. l

USPS Summer Sale – Save 30%!!!!
May 1, 2009
DMM Advisory
Pricing and Classification — keeping you informed about the prices and mailing standards of the United States Postal Service
Summer Sale
Today we filed a notice with the Postal Regulatory Commission for a Summer Sale. The Sale will provide a 30 percent reduction in postage for qualifying Standard Mail customers mailing letters and flats. The Summer Sale will run from July 1 through September 30, 2009.
The Summer Sale offer is subject to review by the Commission for up to 45 days following May 1.
The Domestic Mail Manual (DMM) is available on Postal Explorer (pe.usps.com). To subscribe to the DMM Advisory, send an e-mail to dmmadvisory@usps.com. Simply indicate “subscribe” in the subject line
Paper Firms Cashing In Before Loophole Plugged
By Steven Mufson
Washington Post Staff Writer
Saturday, May 2, 2009
Federal government payments to the U.S. paper industry continued to mount during the first quarter, as companies raced to take advantage of a loophole that richly rewards them for a long-established method of burning byproducts of the pulping process.
During the first quarter, the Treasury pumped $540 million in cash and tax credits into the coffers of International Paper, one of several paper companies that qualify for billions of dollars in alternative fuel tax breaks under legislation that experts say was written for other purposes.
The tax benefits reward companies for burning a pulping byproduct known as “black liquor,” a practice that has been common in the paper industry since the 1930s. International Paper said $145 million of its total has been delivered in checks from the Treasury; because the tax credit is “refundable,” it can result in direct payments to companies with no tax liability.
The huge payments are being made under a tax credit clause in the 2005 highway bill that was designed to promote the blending of biofuels with gasoline or diesel for use in vehicles. In an energy bill adopted in late 2007, the clause was altered slightly to help the Alaskan fishing industry in the home state of then-senator Ted Stevens (R).
Late last year, paper companies began to apply for the credits. PricewaterhouseCoopers pushed the idea, according to industry and congressional sources who spoke on condition of anonymity because of their access to confidential conversations. David Nestor, a Pricewaterhouse spokesman, would not comment on guidance provided to clients. The tax credit expires at the end of the year.
Senior lawmakers, including Senate Finance Committee Chairman Max Baucus (D-Mont.), are weighing amending the legislation to put an early end to the lucrative payments. Canadian and Brazilian trade associations have also protested that the payments give U.S. firms an unfair advantage.
“Unless we plug this loophole, the federal government is liable for billions in credits for black liquor in 2009 alone, even though the credit was never intended for this fuel,” Baucus said at a hearing last week. “We are working to undo that unintended consequence.”
Because the Internal Revenue Service deemed that paper companies were eligible for the credit, the Joint Committee on Taxation has had to raise its estimate of the cost of the credit nearly 50-fold, from $61 million to $3.3 billion. Wall Street analysts put the cost as high as $8 billion.
Last week, Doyle R. Simons, chief executive of Temple-Inland, said that the IRS had approved payments to his company. He said Temple-Inland will use 550 million to 650 million gallons of black liquor this year. Because the tax credit is worth 50 cents a gallon, that would yield $275 million to $325 million in credits.
“They ought to change the law, but you can’t blame the paper companies for saying there’s money on the table and we’re going to pick it up,” said Bob McIntyre of Citizens for Tax Justice.
The United Steelworkers and other unions are backing the ailing paper industry. “Many companies are depending on this tax credit to keep mills running. In short, this credit could not come at a more appropriate time,” Michael V. Draper, a vice president of the United Brotherhood of Carpenters and Joiners, wrote to Senate Finance Committee members this week.
Sen. Olympia J. Snowe (R-Maine), a Senate Finance Committee member, defended the credit’s use. “This tax credit is a lifeline,” she said, for an industry “hanging on for survival in this economic crisis through no fault of their own.”
Many economists and environmentalists say that the paper industry shouldn’t reap rewards for old practices. Snowe argued that the paper industry was “ahead of the curve.” But analysts note that the industry burns black liquor because it is toxic to fish. Leaks are punishable by fines.
Some analysts cautioned that in the midst of the auto industry bailout, Congress would block a program resembling another bailout.
But a UBS analyst’s report said: “At the very least, this is creating debate, slowing the process. . . . In the meantime, the industry can continue to claim credits. The longer the delay, the more cash they stand to collect.”
Newspaper Association Kills Off Print Magazine — Goes Online Only
I think the comments to this blog are actually more interesting than the story. Seems most don’t care about the printed piece!
Failures by Mike Masnick
Thu, Apr 30th 2009 2:25am
From techdirt http://techdirt.com/articles/20090429/1827544698.shtml
The Newspaper Association of America, who just recently has been out pushing the value of a print product as opposed to an online-only product, seems to not be taking its own advice. According to Romenesko, the NAA has not only laid off nearly 50% of its staff, but it’s also switching its own print magazine to an online-only production. Seems difficult to take the group seriously when it claims print is somehow fundamentally a better product, doesn’t it?
4 Comments | Leave a Comment..
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by Matthew – Apr 30th, 2009 @ 6:01am
Actually, I don’t find this behaviour especially hypocritical. I happen to agree that print magazines are somewhat higher value to me than online publications. Most people would agree, though, that online publishing is LESS EXPENSIVE than print publishing. It could well be that, despite print being a superiour format, they’ve opted to go all-online in order to reduce costs. (One could disagree with their assessment of the value of print; I’m just saying, it’s not hypocrisy.)
You’re Right
by kirillian – Apr 30th, 2009 @ 7:22am
You’re Definitely Correct. Print does provide more value – it provides thermal insulation for those that can’t afford more expensive material to keep themselves warm…and SOMEONE has got to provide the fuel for all those trash can fires…
define fundamentally
by Stray Dog – Apr 30th, 2009 @ 7:28am
only when you want to line the bottom of a birdcage or some other task,, no this is not multi tasking, it’s recycling
Print
by Rick – Apr 30th, 2009 @ 7:52am
Disagree. Print still has value and I still enjoy reading while turning actual pages, but perhaps being a lithographer since 1970 has colored my judgement.
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