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Jan 16, 2019

Postage Going Up

On January 27, first class postage is going up to 55 cents, a 5-cent increase. This is the largest increase in almost 30-years. As this article states:
“The Postal Service lost $3.9 billion in 2018, attributing the losses to drops in mail volume and the costs of pensions and health care. It marked the 12th year in a row the agency reported a loss despite growth in package shipping.”

$3.9 billion. That’s a big number. To put this in context the USPS lost almost a half million dollars every hour, 24-hours a day. That’s just not sustainable.

We have been fortunate in this country to have had such a great postal system. It has been fast, accurate and affordable. Nonprofits have been doubly blessed by the US Postal Services’ postal subsidy for nonprofit organizations.

But that is changing before our eyes.

  • Delivery of nonprofit mail is getting slower and slower and impossible to predict.
  • Nonprofit mail is now delivered in batches. That means when your appeal does finally get delivered, it’s hitting your donors’ mailbox at the same time as every other nonprofit’s mail. This fall I received 8 appeals on the same day. So now not only are your appeals unpredictably slow on delivery, they are facing greater competition.

I can’t help but think that the nonprofit postal subsidies will likely end soon.

Here’s what I recommend while there is still time:

Analyze the ROI of your donor segments this fall and test first class postage in top performing segments. With access to reliable nonprofit postage, first class postage is an extravagance. However, you are paying a lot of money to create your appeals, and nonprofit postage is no longer reliably giving your appeal the chance it deserves. Why wouldn’t you pay a little extra to insure a quick delivery with less competition in the mailbox?

As seen time and time again, strategic investments in acquisition and retention prove valuable when looking at a donor’s long-term value. A few extra cents in the right places can make a huge difference.

Test this. And share the results.

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