A postage rate increase by the U.S. Postal Service (USPS) marks the second increase for 2021, the first increase going into effect on January 24, 2021. Postage rate increases for mailing services, such as letters and postcards, will be implemented on August 29, 2021, based on approval given by the Postal Regulatory Commission.
The hike in prices was proposed by USPS originally to combat the falling volume of mail, which according to USPS has declined by 46 billion pieces (28%) and is continuing to decline. The planned increases will affect the items listed below.
- First Class Mail letter (1 oz.) rate for postage purchased at the Post Office will increase three cents to $0.58 from $0.55.
- Metered Mail rates for First Class Mail letters (1 oz.) will increase two cents to $0.53.
- First Class Mail Flats/Large Envelopes (1 oz.) rates will increase sixteen cents to $1.16 from $1.00.
- Postcards will increase by four cents to $0.40 from $0.36.
- Certified Mail will increase by fifteen cents, to $3.75 from $3.60.
Unfortunately, this increase translates into higher expenses for businesses, like transportation, printing and distribution companies. In relation this will likely force mailing companies, such as Valassis and Mspark, to raise their pricing.
On top of raising prices, the paper industry has changed as well with many paper mills shutting down entirely or changing the conditions for orders. In the current market, the Last Date to Change (LDC) has changed industry-wide. With the change, paper mills are now requesting order confirmations 12 to 14 weeks out from press, where they previously were requesting confirmation at 6 to 8 weeks.
In an article by Reuters, a vast majority, including retailers, newspapers, printers, greeting card companies and others opposed USPS’s rate hike, increasing the rate for most mail by seven percent.
However, despite their objections, especially as businesses still recover from the pandemic, the hike will go into effect come August.
Universal Media understands the rising costs and their potentially negative effects on businesses that use mail for marketing fulfillment. To ensure the potential rate increase does not derail our client’s 2021 and 2022 print marketing programs, UMI’s strategy of auditing our client’s print process and optimizing it to eliminate wasteful distribution is key.
The process seeks to offset these price increases by shifting marketing dollars to where they will reach the right people with the right method, ensuring optimal return on advertising spend (ROAS). Our team will work with your companies’ data, ensuring your costs stay under control and within your budgets, even with dynamic changes happening frequently. There are likely to be efficiencies found by focusing on these factors.
If you are interested in learning more about our print audit process or how to optimize your current print strategy, please contact Shaun Baker, Vice President of Analytics/Print Services.
Universal Media, Inc. (UMI) was founded in 1986 by three advertising professionals, creating one of the largest and fastest-growing locally based independent media agencies, specializing in strategic planning, research and media buying.