Economics & Research Blog
USPS' October, More EDDM News, and Other Items
Back in July we presented data about USPS'
By Dr. Joe Webb
Published: December 3, 2014
Back in July we presented data about USPS' Every Door Direct Mail (EDDM) and noted that the price increase resulted in a decrease in volume
. Volume from the second calendar quarter did the same. That +9.4% increase in EDDM prices, part of last year's Christmas Eve exigent ("grinch-like") price increase, has not, pardon the pun, delivered. Prices were up, volume fell -10.3%, net revenues decreased -1.9%. (click chart to enlarge)
The Save the Post Office blog
summarized testimony that the USPS felt they did better than the dire changes they had forecast. The table of data from the testimony is in a Google spreadsheet
. Analysis of the spreadsheet at the most aggregate level shows that the USPS volume is down -1.8%, revenues are up +2.8%, and they are netting +4.7% revenue for each piece of mail. Make more by doing less is not the definition of productivity except to internal cost accountants. Productivity comes from increasing the value of what is produced, confirmed by the actions of the marketplace. Productivity usually increases the market and does not make the market shrink. The USPS on the other hand considers that progress.
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Dead Tree Edition
(one of our industry's best and must-read blogs) reported that the USPS had a great October. October is the first month
of their fiscal year, so trumpeting about how great it is. It's probably not wise, but perhaps not for the reason you think (that counting the chickens before they hatch thing, you know).
Retail holiday sales have been sloppy and bad for the holiday season among the brick and mortar folks, with high growth in e-commerce channels. Some of the retail experts have been explaining it as holiday sales and discounts starting well before Thanksgiving, into October. They also note that discounting is rampant throughout the year, not just for the holidays, especially from the competition of online sellers. With consumers still strained in terms of their incomes, they have become well-versed in using malls and stores as showrooms for Amazon and other online retailers.
One of the beneficiaries of the renewed growth of e-commerce is the USPS which has made deals with shippers and even offers Sunday delivery in some areas. Packages is one area where USPS has made progress, counter to the trends of general mail.
USPS' good October might have been a precursor to the shift in retail shopping patterns, and that shift may be just that: moving the deck chairs around but not changing the number of them.
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Dead Tree Edition had a good summary of Discover Card's continued use of direct mail
, and the critical role it plays in their marketing strategy. It's a good read, with links to the larger story.
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