On October 7, the Postal Service filed its proposal to adjust postage pricing for Market Dominant products in January 2023 with the Postal Regulatory Commission (PRC). The PRC has 45 days to review the proposal, so we should know their decision on whether to approve the proposal just before Thanksgiving. The effective date for the new postage prices is Sunday, January 22, 2023, and the overall average proposed price increase at the class level is 4.2%, but we all know the devil is in the details for price changes like this. Let’s look at a few of them:
- The average increase for letters is 3.3%.
- The average increase for flats is 6.3%.
- The increase for high-density (HD) carrier route letters is 8.4%!
- HD doesn’t provide USPS with much advantage compared to 5-digit mail, so they continue to bring those prices closer together.
- Drop ship discounts remain the same for SCF ($30/M) and NDC ($23/M) entry of letter mail.
- The average increase for single-piece letters is 5.0%.
- The average increase for automation letters is 3.6%.
- The average increase for postcards is 6.5%.
- The average increase for automation flats is 11.3%.
Here’s Some Good News: New and Returning USPS Mailing Promotions
As part of its price filing, the Postal Service also presented its suite of mailing promotions for 2023. There will again be six promotions: four are similar to what was offered this year and two are new. There are substantial postage pricing discounts for each of them. Here’s what to expect:
- The Tactile, Sensory and Interactive (TSI) Engagement promotion will again run February 1 to July 31, but in 2023 the discount will be increased to 5%. While we don’t yet have the guides for the new promotions, we are hearing that all techniques used to qualify for the TSI promotion in 2022 can be used again in 2023. A new technique that can be used in 2023 is applying a scent to the outside of the mailpiece.
- The Informed Delivery promotion will be largely unchanged from the promotion running currently. The discount will continue to be 4%, and the promotion will again run August 1 through December 31.
- The Emerging and Advanced Technology promotion has now been combined with the Mobile Shopping This merged promotion will now run for seven months, May 1 to November 30. The tiered discount for this promotion, which is driven by the complexity of the technology employed, will be increased from 2% and 3% to 3% and 4%.
- The Personalized Color Transpromo promotion for First-Class Mail bills and statements will begin earlier in the year and will run concurrently with the TSI promotion (February 1 to July 31). The discount for most pieces will continue to be 3%, with mailpieces including a Business Reply or Courtesy Reply envelope receiving a 4% discount.
- The Reply Mail IMbA promotion is new for 2023. IMbA is a newly introduced automated accounting system for Business Reply Mail (BRM), and to encourage mailers to adopt the system, this promotion will offer a 3% discount for mailers that use static IMbA on their BRM and a 6% discount if they use serialized IMbA. This promotion runs July 1 through December 31.
- Another new promotion is designed to encourage Retargeting Mail. This promotion runs from September 1 to November 30 and will provide a 5% discount to mailers of First-Class Mail automation postcards that are mailed in connection with website or app behavior (for example: sending a postcard to someone who visited a website but abandoned their shopping cart).
Want to Save on Postage?
Contact me or your IWCO Direct account team if you want more information about the pricing proposal or you want to leverage promotions to blunt the impact of this postage price increase. We’re ready to help you optimize your postage spend!