Links to the resources mentioned in the podcast.
Chris: Hi, this is Chris Lien
Anita: And I'm Anita Pursley. Welcome to Industry Corner, a podcast where we share postal industry news to help you stay informed.
Chris: On today's podcast we recap the June Mailer's Technical Advisory Committee meetings, including comments from the Postmaster General, some concerns about Informed Delivery, and a greater focus on Address Quality Address Change Service. So let's get into it. Welcome to the podcast everyone. Hi Anita.
Anita: Hi Chris. You made it back from DC okay, I hear.
Chris: I did. We had a great time at the Mailers Technical Advisory Committee meetings for June in Washington, DC and MTAC is always a great opportunity to interface with our postal partners, our customers, the mailing industry, and just get an update as to what's going. And as always, there's no shortage of stuff, right Anita? I mean there's lots to talk about.
Anita: A lot to share.
Chris: I will say that DC was incredibly humid this time of year though. So, uh, so that was a bit of a challenge walking from the hotel over to postal headquarters. But once you got there, it was well worth the walk because it was good conversation and good interaction.
Anita: Hey, before we get into the meat of the update, there are a few things I just want to update our listeners on from our last podcast. Is that okay with you?
Chris: Absolutely, yep.
Anita: All right, so on the last podcast we talked about Steve Phelps' presentation on pricing update and what we can plan for in January. So I mentioned that they're projecting a 1.98% postage increase in January of 2020 but what I failed to mention is a mandate by the postal regulatory commission in the annual compliance determination relative to marketing mail flats. If you are a marketing mail flat, you have to project or plan for an additional 2% above the average percentage for that class of mail just on the flats, on the non-carrier route portion of a mailing. So there's a lot of discussion going on about whether the postal service will actually propose that because you know, sometimes they don't follow the mandates by the PRC, but I did hear several conversations where the postal service said that they are required to do this. So if you are a marketing mail flat, you have to add an additional 2% so I wanted to make sure that we covered that.
Chris: That's a good heads up to our listeners on that part of it. I have to say that if that's the case and if they do go forward with it, I'm disappointed. Because the last time we had something like this it caused volume to go down and that's particularly troubling since we know catalogs work. So we'll have to watch that one closely. I hope the postal service disagrees with that. But you know, it sounds like they're not going to.
Anita: Right. And you know, there's still time to fight this. I do believe that we should make our voices heard and I'm sure there will be a lot more discussion on this because it's just absolutely not going to solve the problem.
Chris: All right, listeners, let your association's know if you don't want that to happen, let them know.
Anita: Right. Good advice. And then we did have a couple of updates on seamless. Last time I reported that 38% of the commercial mail is now on seamless, there is an uptick. We heard it's now at 41 but this is a statistic I hadn't heard yet. 79.5% of commercial letters have migrated to seamless but only 20.5% of flats.
Chris: So it's higher, but it's being skewed because letters are on it, right?
Anita: Right. 41% is probably not an accurate portrayal but they formed a subgroup and I'm sure it's the ALGs LSCs quads, you know most of the flat mailers and they're focusing on issues that are preventing them from moving towards seamless. And then EPS migration is up from 77% to 85 so they're getting closer. We still have the July 1st deadline though for those who got the exception. So still some work to go on that. And then the Informed Delivery Monday issue. Remember I mentioned that?
Chris: Yes, that we weren't getting scans of our mail pieces on Monday mornings for some reason I went back and I looked and you're right. I wasn't seeing those.
Anita: Right. I think it's been going on for about six weeks now. But we did talk to Bob Dixon about it during the focus group sessions and he said that there'll be a fix for that coming up in a July release. But anyway, he explained that the Monday issue was caused by the fact that there was a certain amount of time allotted for distributing the daily digests and once that time was exceeded, it went to the following day. And so you got the blue box in your digest. And for that reason it didn't affect the entire country. So it seems like everybody I've talked to is on the east coast, so I don't know if that's the answer, but we expect to see a fix in July. So I just wanted to follow up because we did talk about those on our last podcast.
Chris: Right. Very good. Thank you for those updates. Now let's talk about MTAC. This meeting kicked off similar to last ones where the PMG gave some comments to get us started. You wanna cover some of those?
Anita: Sure. We talked about the April 30th hearing where the dialogue went on between Megan and uh,
Chris: Representative Meadows, right?
Anita: And so we were expecting a subsequent hearing on July 7th but Megan said no, she wasn't expecting another hearing, right?
Chris: Yeah, nothing is scheduled and she hopes there isn't one.
Anita: Right. And that they have given the committee a verbal briefing on their 10 year plan. So they are working on finalizing and validating its 10 year plan and she wouldn't commit to a release date on that saying that the report would come out in due time and that the BOG would probably be involved in determining how that rollout occurs. So they are working on it and we should hopefully see it relatively soon.
Chris: You know, that'll be interesting to look at too, because I don't know how the postal service can put together a 10 year forecast. Right. With all the uncertainty going on relative to governance and changes in the supply chain and the usage of the mail for marketing and binding the nation, all of those things. But a 10 year plan just seems so unrealistic and the gap to close as part of that 10 year plan, $125 billion gap. It'll be interesting to see. I'm not sure how they're going to do that, but I'm glad to hear that the PMG is verbally explaining to Congress what is intended to be in the plan. So we'll have to keep a close eye on that.
Anita: Right. Hey, I don't know if you had a chance to read the latest PostCom bulletin, but what they reported is that the Huffington Post had a sneak peek at it. I don't know how they got a copy of it and so I won't share what's in it cause I didn't get into all the details, but it looks pretty interesting. It looks like there might be some very controversial issues relative to union pay and so forth. So…
Chris: Well I'll wait till the official one comes out. So… okay?
Anita: That's what I decided to cause that's a little bit like a rumor but we'll see.
Chris: Yeah, yeah. All right. Now Greg Crabb, Greg Crabb is the Chief Information Security Officer for the US Postal Service and talked about Informed Delivery, right?
Anita: Exactly. And you know we had asked him to speak and when I say we, I'm in the industry leadership because the industry has a lot of concerns about their security protocols relative to protecting ID mailer. And so I'm curious to hear what you thought of his presentation because I don't think it went far enough and I think it was a bit off track.
Chris: So my thoughts on it are, one, I thought it was a good presentation. I thought it gave us an opportunity to see through the postal service's eye, specifically Greg's their view and concerns about Informed Delivery and for our listeners to get a better understanding. There's a 2% promotion for later on this year in the Fall that uses Informed Delivery and frankly it's an easy promotion to get. Relatively easy to apply for it and to be able to leverage it, but the concern is that there'll be this deluge of Informed Delivery campaigns that are going to be hitting and the big concern is that with these Informed Delivery promotions, you have to have a click through for the ad and the concern that Greg talked about is when you click on that offer in the Informed Delivery digests, where it comes into your email and you go to a landing page, what is the experience of the user when you get there? Are you going to have all these ads popping up on your screen? Are you going to have excessive ads taking 15 seconds or longer to load in some cases? Maybe a minute. What about privacy and data sharing is it going to be a creepy experience, right? You click on that and seconds later your phone rings somehow, you know? Missing ad pages. There was that part of it. All these things that Greg talked about both from a user experience concern as well as potential security problems.
Anita: Right. So that's where I felt like it was a little bit off track because he was more concerned it appeared to me about the customer experience and quite frankly, I think that's right on. I mean I think we need to worry about customer experience because you know it is kind of creepy if you click on a link and then all of a sudden the phone rings and they want to know if you're interested in their product. I think that's a little excessive, but I think mailers were more concerned about the protocols and the fact that anybody who has your MID or uses your MID can create a campaign for you. So I felt like he was kind of missing that point.
Chris: That's a very fair point. And you're correct on that. In fact, one of the MTAC members had talked about the concern and the level of angst when they go to set up these, are they using the right MID? What if you accidentally transpose the MID or a CRID as you're putting that into the system and put that into the campaign, is all that data going to go to the wrong location, the wrong mailer? And so that's a concern because there's nothing really in there checks and balances thus far to make sure that when that's entered into the system, it's done correctly and it relates to that. So you're right, that's where the industry was hoping for the postal service to give some guidance or some rules with that. And instead Greg seemed to talk more about a user experience. I liked his presentation, but my overarching concern here, Anita, is that we're a little bit late and I really wish we had started this conversation 6 to 10 months ago as we were starting to look at this because the other thing later on in the day that was talked about was just the quality of the mail.dat files that were being submitted for these campaign registration. Only 33% are able to pass validation for campaign submission with mail.dat. So we have this whole big growing list of concerns, user experience, data integrity for setting up the campaigns, the quality of the mail.dats that go with it. I think we need a work group and I think that we need to have conversations immediately on this to try and get some boundaries of what's acceptable and what's safe and secure and is going to have the proper data integrity. And I wish we had done it before and in fact I, you and I were chatting there. We wish that it had just been put out on the floor there. Hey, let's start a work group. Let's get it going.
Anita: Exactly. Yeah. We don't have much time before this promotion. He mentioned that his security team has evaluated 35,000 links that have been submitted, and to me it's like, isn't that an after the fact review?
Chris: It is…he's looking at them now. I'm not sure the reasons or the rationale for letting it go this long, but there's not a lot of time left. The promotion kicks off I think like next month, July or August. Right? For registration for it.
Anita: Registration, right.
Chris: Right. But people are building these links now, right? They're building these landing pages now and so that's a real concern with that. So if we're going to do something, we're going to have to move quickly on this.
Anita: Right. He did say that they're building automated tools to detect any malicious behaviors, so that was really good. I was glad to hear that. But I'm glad you mentioned the mail.dat submission, the low threshold of success because there's been a strong suggestion by the postal service to suggest that customers try Informed Delivery prior to the promotion so that they can make sure that they are succeeding and he actually recommended that they don't go the mail.dat route, that they go that mailer portal route because there has been such a low threshold of success.
Chris: I can understand that from their perspective from my personal take away is that since BCC Software supports the campaign submission through mail.dat. And we do have customers that are actively working with that. I know I'm going to be meeting with my product planning team and I'll get a better understanding of what can we do from education from maybe some additional checks and balances and things like that on the data. Just a better awareness of what needs to be done for these mail.dats prior to submission to that because we want this to be a good experience for the mail service providers. I see it as a growth opportunity for them and we need to do that. Related to this too, although on a different piece of it, just the eligibility of pieces for it and I thought that was interesting, Anita, the Informed Delivery promotion in essence if the piece can't be scanned or the bundle can't be scanned in order to support the Informed Delivery daily digest, you're not going to get the discounts on that is the way that I heard it. So mail that's entered into the DDU non-automation mail, EDDM, detached address labels…
Chris: Yes, saturation flats, business to business mail. So any of those types of pieces or mailings would not be eligible for this discount. And I think that's something that our listeners need to be aware of it before they come into this that when they are talking to their customers about this Informed Delivery promotion, which is a good promotion and I like the idea of using it, but we need to have both eyes open that there may be portions of the mailing that aren't going to qualify or entire mailings that really aren't going to work for this promotion so that they don't get the incorrect expectation of their customers.
Anita: I'm glad you mentioned that because they have released the promotion requirements. So they're out there now and they're intending to have a webinar on Thursday the 27th to review the requirements and then give mailers and opportunity to ask questions. I'm pretty sure that's just going to be the user group. So they're nailing them down soon. But you're right, there's a lot of mail that will not be eligible. So it's something we really need to pay close attention to. And I like the idea of having a meeting internally.
Chris: I agree. And one last thing is on this, and this is good news. So, uh, what was reported by the Postal Service is that 11% of the households in the United States have Informed Delivery now, somebody within that delivery point has subscribed to Informed Delivery. So 11% of the households or 17.4 million registrants and that continues to grow. Gary Reblin, Vice President of Product Innovation had shared that they're still anticipating that at some point next year, I think the end of the fiscal year, next year they'd be at that 40 million. So that's still a pretty lofty goal for the number of registrants, but one of the biggest contributors to that is the Internet change of address as people are doing their ICOA to be able to change the address online. It gives them an opportunity to be able to enroll for Informed Delivery.
Anita: Got It.
Chris: All right. Let's switch a little bit to address quality because that is starting to pick up again. We shared with our listeners CASS Cycle O was extended, so we're not going to have another CASS cycle until the calendar year 2021. However, it's still always a good time to talk about what can we do to improve address quality and ACS Address Change Services. Certainly one area for that, and it was interesting Anita, I sat in the first class mail group when we talked about ACS and what we found is that, how can I say this? The postal service keeps track of how many times they tell an ACS subscriber that somebody moved, you know, Chris has moved, here's his new address. Chris has moved, here's the new address, right, and Jim Wilson, Manager of Address and Geospatial Technology. The postal service talked about how many times he has to remind people, if you will, and it's a pretty large number. That's five times or more. 25% of the free ACS notifications that have been sent have effectively been ignored. Whereas if the postal service charges for ACS, 10% of the five or more. So money drives behavior. I guess as we've said many times before,
Anita: I was pretty disappointed to hear that because the industry's been just saying to the postal service for so long. Just provide this information free, you know, this nit picking of charges here and there is just an annoyance and an administrative costs, but Jim did take that to heart and started collecting data on that. So…
Chris: Yeah, it seems like what he's saying, you know, at least my takeaway is that he's concerned if they give traditional ACS away for free, then we're going to see poor behavior, right? People just won't use the data and we don't want that. We want people to use that data because we need the address changes to be applied. First Class mail now is… Primarily forwarded First Class Mail is still a large, a very large contributor for undeliverable as addressed mail. And speaking of UAA I found it was also, it was interesting that the postal service, talked a little bit about… The Vice President of Delivery, Kevin, talked a little bit about the UAA codes. There are 27 undeliverable as addressed reason codes that a carrier, letter carrier can select from to be able to say that this piece is UAA and you know there's a whole range of them. Well the concern that we've had as an industry for a long time is that the number one reason that a mail piece is deemed UAA is because address not know, which seems to be sort of the default. I don't know you know, and the suspicion from the industry is that the carrier doesn't have time, doesn't really know and doesn't want to look into it. So they just pick the first option. And you know, Kevin kind of took issue with that and felt that that wasn't fair. But what they did do is they've enhanced the mobile delivery devices. So that now the MDD, when the carrier is trying to effect delivery, they can choose what that UAA reason code is right at that moment. I love that idea, unfortunately they can only put 10 of the 27 available for the carrier and if it's a reason other than that they have to take it back to the office to make that change. And the other problem that we have with this, Anita, and this is an interesting thing, but remember we have two major unions, craft unions here involved, right? The National Association of Letter Carriers and the American Postal Worker's Union and if the letter carrier is making that change right in the field versus how can I, can I say this, the letter carrier can do this in the field, but if it's brought back the UAA code, it's done by somebody with a different craft. So who enters the UAA reason code kind of blends between the different crafts. That's part of the challenge that they've had with that. Hopefully we'll continue to make progress on that and get better data and be able to use that. Because again, address quality is still a really important part. There's mail volume continues to decline, which means that we need to make every mail piece count and one way to do that as ensure we've got that address complete correct and current before it goes into the mainstream. Right? The three C's, you know, I love those. A lot of stuff, you know folks. Anything else Anita?
Anita: No, you know it's so interesting. The more we talk, the more I think about topics to discuss on the next podcast. So we have a lot to talk about in the future and hopefully this will be helpful to our listeners.
Chris: Yeah, I agree. Stay tuned for more information that we'll be providing through our newsletters and webinars, express learning sessions, so many different channels that we try to educate our listeners, the industry, our customers. So please, if you've got questions, let us know. Visit our webpage at bccsoftware.com. Give us a phone call, right Anita?
Chris: Cause we want to hear from you. And as always, let us know how can we help? Have a great day everyone. Thanks Anita.
Anita: Thank you, Chris.