Think of it as the catalogers’ equivalent of “first you get mad; then you get even.” When they learned, in late February, that the postal rates for Standard Mail flats were going to increase appreciably more than they’d anticipated, catalogers shook their fists, railed against the Postal Regulatory Commission, and sent hundreds of letters of protest to the Postal Service. Then they started reviewing their business plans, seeking ways to mitigate the effects of the May 14 rate changes.
It was then, in early April, that Multichannel Merchant surveyed readers to find out what changes, if any, they expected to make to their business in response to the postal changes.
Most, in fact, are considering changes in their catalog creative and production, circulation, overall marketing, and parcel delivery strategies. Little wonder, given that the 155 survey participants who mail print catalogs estimated that their postal costs would increase a mean 14.2% if they didn’t modify their business practices in some way. What’s more, nearly 21% of respondents said their postal costs would probably go up more than 20% if they did not make any changes. (Fourteen percent, incidentally, didn’t know how much their postal expenses would go up.)
The more-popular changes are, no surprises here, the simplest. Half of the respondents are considering reducing their catalog mailings to inactive buyers, and 40% may decrease their overall catalog circulation; 34% are looking into changing the paper stock or weight of their catalogs. More than three-quarters (77%) said they are considering increasing their use of e-mail as a marketing tool, and 59% may rev up their search engine optimization efforts.
Respondents are more reluctant to pass the costs on to their customers. Only 21% said they would be raising their prices as a result of the postage changes, with another 34% not yet sure. Among the 230 respondents that use USPS to deliver packages — 70% of the participants overall — 46% said they’ll be increasing their shipping and handling charges as a result, while 28% are uncertain.
Thirty-one percent of the survey participants who use USPS for parcel delivery said they’ll be shifting at least some of their parcel business away from the Postal Service. Add to that the nearly 40% who aren’t yet sure, and the rate hike could prove to be a boon for independent carriers.
Others that may benefit from the postal increase include postcard vendors: Nearly one out of four catalog mailers are considering replacing some catalog mailings with postcards. And providers of list hygiene and addressability products and services may see an uptick in business too, as 25% of the catalogers surveyed are looking into using more of such tools.
METHODOLOGY
On April 9, Penton Media e-mailed invitations to participate in an online survey to 22,736 magazine and e-mail subscribers of Multichannel Merchant The invitation contained a link routing respondents directly to the questionnaire. Respondents were offered a chance to win one of four $50 Amazon.com gift certificates. Follow-up e-mails were sent on April 16 and April 19. Of the 22,044 deliverable e-mails, 328 surveys were completed, for an effective response rate of 1.5%.