Growing the Mail Channel

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About the Author

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Bob Rosser

Bob Rosser is Director, Postal Affairs, Products and Services for IWCO. Bob has been with IWCO for the last 19 years. He leads our postal optimization strategies for our clients that achieve in-home targets at the best possible postage rates. Bob’s in–depth automation, data, and postal operations experience also helps ensure that mail packages meet specifications. He subscribes to the innovation philosophy that the best way to predict the future is to help create it. He currently serves as the Mailers Technical Advisory Committee’s (MTAC) Industry Co-Chair and sits on the Board of PostCom and DTAC, and is actively involved with the National Association of Presort Mailers (NAPM). Bob enjoys his family and Grandpa role in the Twin Cities along with music, golf, sports, and Nebraska Cornhuskers football.

Using new USPS growth incentives to grow your mail channel 

Fall typically means marketers are busy with budget and strategic planning for the coming year. And the new 2024 growth incentives from the U.S. Postal Service (USPS) provide a great opportunity to take a hard and strategic look at 2024 mailing plans. Marketers can use these incentives to grow First Class and Marketing Mail volumes. And a 30% postage credit on mail volume that exceeds a Marketer’s mutually agreed upon baseline number can be a game changer for some client organizations. 
 
Below, I’ll walk through an overview of the new growth incentive programs and how marketers can leverage these programs to optimize their spend and improve their results.  

What’s involved in the USPS growth incentive programs? 

There are two separate and distinct incentive programs: one for First Class mail volumes and one for Marketing Mail volumes. 

Parameters for the programs are as follows:  

  • Timing:  
    • The Incentive program begins on January 1, 2024, and lasts the full calendar year through December 31, 2024. 
    • Registration will open in November 2023 and remain open until the end of June 2024. 
    • Postage credits will be reconciled and deposited (if applicable) based on year-to-date volume and class-specific spend at three distinct times: July 2024, October 2024, and February 2025. 
    • Postage credits earned can be used both in 2024 and a through December 31, 2025. 
  • Measurement:  
    • The measurement period for your baseline volume is the USPS 2023 Fiscal Year (October 1, 2022, through September 30, 2023). 
    • USPS is gathering this data by Mail Owner through the use of required ‘By/For’ information in IMb Full Service, submitted via eDoc at the time of mailing.  
      • For example, the data we populate for any mailing includes: Who the mailing was prepared by and submitted for. This might look like:   
        • By: IWCO  
        • For: Your Company Name  
      • IWCO and Company name are identified in our case using USPS Customer Registration IDs [CRIDS]). 
  • Volume:  
    • There is no volume cap on the incentive and even our clients with as few as 1-million-piece baseline volumes can participate. 
    • Postage credit for volume growth exceeding your baseline is calculated at 30% of your net postage paid year to date.  That net postage number used is after any promotion discounts you are eligible for in 2024 as well. 

For more details on USPS program specific details, contact Bob Rosser bob.rosser@iwco.com  or check out: https://postalpro.usps.com/growth-incentive-faqs 

How can I optimize my planned postage spend using these programs? 

As a marketer interested in optimizing your planned postage spend for 2024 and learning how the Growth Incentive program can improve your results, you may be asking yourself “What should I do next?” 
 
I’d recommend taking the following steps:  

  • Know your baseline numbers. Do your homework to gather all volume information by class and company owned CRIDs from all your internal and external mail service providers. 
     
  • Make time for the data collection process. For some of you this will be a very straightforward. For others, it will be more complex as you work to understand all applicable CRIDs and mailing methods used to process and mail company volume. This data collection exercise will help you develop accurate baseline numbers for each business unit as you meet with them. You’ll learn who has the potential to increase their volumes and take advantage of the incentive and who doesn’t. 
     
  • Familiarize yourself with your own numbers modeled with rate increases. With the January 2024 rate increase and another postage increase expected in July 2024, a 30% postage credit for a marketer is a significant opportunity to impact the largest part of your marketing mail spend. Those clients planning for growth can see a dramatic reduction from an estimated 6 – 20+% in their direct mail channel Cost per Lead (CPL) and Cost of Acquisition (COA) with additional qualifying incentive volume. This can be modeled and estimated relatively easily. 
     
  • Think about the opportunities mail can bring to your channel mix. With its measurable results, omni-channel compatibility, and hyper–personalized possibilities, mail can be highly effective compared to other media channels in reaching your target audience. An improved return on investment from qualifying Growth Incentive volumes could be the significant boost your marketing plans needed for 2024. This can help you: 
    • Test new creative strategies 
    • Add mail components to your digital only efforts 
    • Expand cross-sell and upsell efforts 
    • Open new emerging markets 
    • Address customer churn 
    • Build on what’s already working in your mail channel 

There’s a lot of potential in these incentive programs, and I hope that I (and the USPS) have you thinking differently about what’s possible in your 2024 plans. I’ll leave you with one parting question until next time: Isn’t it better to invest a little more than you had planned to drive big results in your mail channel efforts for 2024?  

The IWCO team is ready and excited to assist you as you evaluate this new opportunity and rethink what’s possible through mail in the year ahead. 

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