Is Informed Delivery the Next Big Thing in Marketing?


The USPS created a buzz in the industry at the 2016 National Postal Forum (NPF) when they defined Informed Delivery (ID) as a way to enhance consumers “mail moment” with the goal of making mail relevant and slowing down the degradation of mail volume. At the 2017 NPF they made it a focal point of the conference and declared it “ready to go.” They anticipate it will be the next phase of omnichannel marketing. So get on board mailers!

A bit of background for those unfamiliar with Informed Delivery. At its core, ID is a system that allows consumers to view images of their mail online (via email , a phone app or logging into USPS.COM) before it arrives at their house. All mailers are paying for the development of this product through postage since the USPS does not have a revenue stream tied to it. To enhance the core ID product the USPS is developing an option for mailers to control how a consumer views their mail piece electronically, including the ability to have the consumer link directly to a website. (https://www.usps.com/business/pdf/informed-delivery-overview.pdf)

I don’t know whether this product is going to be the next big thing in marketing or if it will actually work to slow down the degradation of mail volume. I’ll let the numbers speak to that. I do want to be sure that all who consider ID go in with their eyes wide open and understand what’s in place today and what might be there in the future.

Consumer Involvement

The USPS is targeting ID to more than 127 million households in the US. So far they have registered consumers from 5.8 million (4.5%) households and of those, 1.7 million (1.3%) are using the email or the phone app. The USPS states that only email and phone app users are truly engaged, while the rest may occasionally look at the images. Who are these 1.7 million engaged consumers? The USPS will not, nor can they, divulge due to privacy laws. But ask around at the next industry function you attend and see how many of your fellow mail professionals are registered. How long will it take to get a reasonable number of consumers signed up that might tip the scales to keeping mail relevant? What is a reasonable number of consumers? The USPS plans to market to consumers throughout the fall mailing season and hopefully we’ll have a better idea of whether the numbers and activity level of engaged consumers has increased sufficiently sometime next year. 

Technology – next step to omnichannel

On the technology side, currently only letter mail that sees a Delivery Point scan is creating an image in the ID applications. By default, this is a black and white image of the address side of the mail piece.  Images from flat mail, catalogs and publications, are not included today. The USPS has plans to add additional software over the next few months that will allow them to create an ID event when a specific catalog or publication is scheduled to arrive in-home. The open issue is that in most cases the software that creates this event uses scans of bundles or pallets and not a picture scan of the mail piece. This means the consumer will not see the mail owners brand unless the mail owner steps in and invests in submitting additional information to the USPS about the mailing.

This trigger software is just one of many software components that have yet to be written, or in some cases, defined. For example a number of applications need to be developed that will allow the mail owners to encompass ID as part of a marketing campaign. Missing components include the ability for the mail owner to know which mail pieces triggered an ID event as well as the ability to create customized messages for each consumer or group of consumers. The USPS is aware of these missing components and is working towards meeting the mailers needs, but this will take time. Will a marketing analyst be able to measure the impact of adding ID to your existing campaign without this data? And if not, is this really a step forward or is the USPS just muddying the marketing data?

This is just the tip of the iceberg on the technology challenges facing the USPS and the industry in moving forward to make ID the next step in omnichannel marketing. Have I failed to mention the various system needs, data security (https://krebsonsecurity.com/tag/informed-delivery) and the investment that mailers will need to make for this to become a viable marketing tool? Let’s just say there are more “investments” to be made.

Measurement of Success

I’ve asked both the CFO and CMO of the USPS how they are going to measure success. They usually avoid discussing metrics, insisting they have to do this because it’s the right thing. That may be true, but I struggle to understand why an organization that is currently fighting to create any ROI from a $1 billion  investment in the Flats Sequencing System (FSS), would venture into another project of this scope without any measurements for success.

As mentioned earlier, the USPS is using postage dollars from all customers to develop ID and has no monetization tied to this program … YET. The USPS has hinted that it intends to monetize ID similar to the way GOOGLE and others monetize their web searches. There has been substantial investment in IT development and the base infrastructure required to support the limited functions of ID today. Will this monetization scheme pay for all the investment?

As a mailer, how will you measure success if you engage ID? I suspect that each of you will need to look at the options available and will determine whether this is a good use of your marketing dollars. And yes you will have to invest in ID if you expect something out of it, even if the USPS is stating that it is free.  There is a cost to set-up a mailing for ID and to communicate this to the USPS. I also expect that your success algorithms are more sophisticated than what the USPS has demonstrated so far, and in the process you will push the USPS and others to make further investments necessary to helping you achieve an ROI.

Conclusion

I hope I’ve given you enough detail to understand where Informed Delivery stands today. Given the lack of substantial consumer involvement, the number of open technology issues and the inability to create a measurement for success, I would state that at this time Informed Delivery is still in a proof of concept phase. Will Informed Delivery meet the goals of the USPS? It’s too early to tell. The product needs to be fleshed out and the USPS needs to finalize how much more it will invest.

Consider also the fickle consumer who this product is aimed at. Will they get aboard and use this to augment mail? Or will they look at this as a way to determine whether they need to walk to the mailbox to pick up mail today?

Am I saying “don’t participate at this time?” No I’m not! Just make sure that when you do, you go in with realistic expectations.

Finally, let’s all please keep the dialog going on this product, both what works and what doesn’t. The USPS is open to suggestion on what can be done to improve ID. I’ve participated in a number of client discussions with the USPS and others to help, and look forward to more because … possibly this is the right thing to do.

Phil Thompson is Quad/Graphics Director of Postal Affairs. He manages the business and technical relationship between Quad and the USPS. Phil partners with the USPS and customers to develop, test and improve the efficiency of mail handling and expand postal e-commerce solutions.

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