We all are very much aware that the Great Recession over the last few years has hit many businesses hard.
The United States Postal Service is no exception.
Mail volume was already declining with the introduction of new technology in computers and email.
And to make matters worse, some of the worst economic times seen in decades came with a furry.
All types of mail saw a dramatic drop in a significantly short amount of time.
The USPS website showed that the total mail volume in 2006 was approximately 213.1 billion pieces.
In 2015, only 154.2 billion.
That is still a lot of mail but a drop of that magnitude is, well, staggering.
So what the heck happened?
The Exigent Rate
In effort to survive, the USPS called for an Exigent Rate Case.
This case stated that due to the circumstances they were in, the Postal Service had permission to raise the market-dominant prices above the CPI-U, or consumer price index price cap for a certain amount of time.
After the submitted proposal and a long hearing, which was conducted on record and gave the opportunity for the public to comment, the case was granted.
Ergo, the very high rates we were seeing a short time ago.
A Drop in Rates
As mentioned, the Exigent Rate Case was only granted for a certain period of time.
That time is over.
The emergency rate expired on April 10, 2016, which was the first postal rate drops we’ve seen since 1919.
Maybe the first for some of you in your life!
And the good news just keeps getting better — for us, anyways.
Mail volumes have recovered significantly, especially for packages due to online shopping.
But as for the Post Office, it’s still not all rainbows and sunshine.
The current Postmaster General, Megan Brennan, says multi-year revenue declines are still a big concern and were in excess of $7 billion in year 2009 alone.
She also said in an USPS article that “removing the surcharge and reducing our prices is an irrational outcome considering the Postal Service’s precarious financial condition.”
For starters, the United States Postal Service isn’t going anywhere anytime soon.
But we still don’t know how these rate decreases will affect their bottom line.
It goes without saying, for those of you considering a direct mail campaign, this is the best time to experiment!
Now that mailing and shipping rates are low, it’s time to move away from digital and use this opportunity to take another stab at traditional marketing.