Compliance. Not a word that necessarily leaves a warm, first impression with First Class mailers. Perhaps it should. The purpose of this article is to give the mailer a perspective on this matter and the value behind it.

Of course the issue of compliance centers on the Move Update Regulation imposed on First Class mailers last year. A stated purpose for Move Update was to reduce the $1.5 billion cost for processing upwards of 5 billion pieces of Undelivered As Addressed (UAA) mail. The U. S. Postal Service (USPS) applied a mandatory name/address hygiene requirement to First Class mailers because this segment generates 51% of the returned mail.

This writer previously suggested a portion of First Class mailers might be using NCOA or FASTforward™ to get their postal discounts but not bothering to apply the changes. While that may well be fact, all matter of reason suggests this would be but a small, fractional quantity of mailers. What manager of a mailer of size would dare risk the negative publicity, fines and job jeopardy for a limited front-end gain? It doesn’t compute. But that doesn’t suggest the USPS shouldn’t see that First Class mailers adhere to the rules.

However, there are a couple of difficulties with the issue of compliance: the Postal Service’s approach and the contradiction of the official numbers.

In today’s “spin environment” we’ve become accustomed to having situations presented in the most favorable light. Unfortunately, what’s come forth on this matter is quite different. Rather than emphasize the desire to “capture an understanding of how mailers are abiding with Move Update”, the USPS has put the emphasis on its intent to seek out and eliminate whatever fraud may exist. That posturing is troublesome because it is unnecessarily confrontational. Business First Class mailers bring significant revenues to the USPS. In spite of growing alternatives, their allegiance has held this past year with a slight overall increase in first class mail volume. A campaign of enlightenment, understanding and partnership seems a more prudent approach.

And then there’s the matter of numbers. USPS statistics present conflicting, indeed confusing, details. Capture these facts:

• NCOA and FASTforward processing (pre-mail cleansing activities) increased by some 20 billion records; about a 25% increase
• First Class mail only increased by 1.2%
• Instead of lowering, UAA mail actually increased by 1%

Note: Sources are USPS National Customer Service Center and USPS Revenue, Pieces and Weight (RPW) Report. Figures are preliminary.

Since the NCOA and FASTforward processes don’t distinguish by mail class, it’s impossible to identify how many were processed by First Class mailers. And yet, it’s logical that a correlation must exist between addresses corrected to a corresponding reduction in returned mail.

One example: If just 10 % of the increased use of pre-mail services was used by First Class mailers (with an average of 2% corrected records) and applied to their files, 40 million pieces would have been delivered rather than returned. Enough to eliminate the increase in the UAA volume.

However, another example shows a real contradiction that needs resolved. One First Class mailer using endorsements (and applying the changes) every six months has experienced the same amount of returns on each occasion. Net result: no gain to mailer or reduction in UAA volumes. The exact opposite of the goals intended for Move Update.

Three actions, if taken, should result in improved conditions and performance:

1. The USPS should continue its dialogue with First Class mailers. Explaining the UAA problem and benefits of Move Update at Postal Forums and other Industry gatherings would be an effective and economic way.
2. Every mail manager, CFO and CEO needs to appreciate the negative cost impact related to return mail, particularly statement and invoice returns. Pre-mail service licensees and UPSP representatives need to take the initiative.
3. Finally, the most obvious resolve to this ROI (mailer) and UAA (postal) dilemma: Increase the pre-mail cleansing frequency. If semi-annual updates fail to generate net improvement, evaluate a three or four time frequency.

The common thread interwoven in the three? Communications. Call me with your experience (954/428-2270). Perhaps this column can be a shared communications vehicle.

Bob Swick is VP Data Services for Anchor Computer, Inc. He can be reached at rswick@anchorcomputer.com for further information.

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