USPS Proposal Could Impact Nonprofit Premiums

Nonprofits that use premiums for donor acquisition and renewal could face increased costs under an amendment being considered by the United States Postal Service (USPS). The proposal would limit all USPS Marketing Mail, regular and nonprofit, letter-size and flat-size, to content that is only paper-based/printed matter. No merchandise or goods will be allowed of any type regardless of “value.”

Something as basic as using a metal or plastic paper clip could force a move from Marketing Mail, which used to be called Standard Mail. Organizations would be forced to Priority Mail, Parcel Select or another USPS rate. Packages with goods and merchandise will have an Intelligent Mail package barcode (IMpb) and will travel through the package network stream, according to the USPS.

A spokesman for the USPS said the Advanced Federal Register Notice issued last week requested comments from mailers on a proposal to limit Marketing Mail Flats to paper-based fulfillment. “This is not a notification of a change, it is to gain feedback from mailers on this proposal.” Comments are being accepted until Oct. 22.

Reaction to the proposal was quick at the DMA Nonprofit Federation conference taking place this week in Chicago. “The Postal Service was just coming back. This couldn’t be a worse time,” said Cheryl Keedy, creative director of The Harrington Agency. She projected that postal fees could double from roughly $250 per thousand to $500 per thousand under such a change.

The potential change would “dramatically increase the cost and impact on many nonprofits that are dependent on and have a significant percentage of their file premium dependent,” said Charlie Cadigan, senior vice president of the nonprofit division of Wiland. Many organizations are attempting to become less premium dependent “but that doesn’t happen overnight,” he said.

“We do carrier route presort. We already do everything but deliver it,” said Cadigan.

The adage in fundraising is acquire by premium, renew by premium. Donors acquired with a premium come to expect a trinket of some sort during a mail solicitation. Religious organizations, for example, often include plastic prayer cards or rosary beads.

Stephen Kearney, executive director of the Alliance of Nonprofit Mailers (ANM), said such a change would have “a huge negative effect on nonprofits. It would rule out all front-end and back-end premiums that nonprofits have been sending for years.”

It’s the kind of change that normally would go through the USPS Mailers’ Technical Advisory Committee (MTAC) before being proposed, according to Kearney. MTAC is “a way to get feedback, learn the possible impacts on mailers, and find a way to come up with creative solutions. For some reason, they went straight to the Federal Register,” he said. The MTAC is scheduled to meet for its quarterly meeting on Oct. 2.

In the Federal Register notice on Aug. 23, USPS claimed the move is to improve “both processing and the delivery of goods and merchandise moving through the mail stream.”

The “limitation to non-merchandise, paper-based/printed matter content would serve three goals:

  • Facilitate levels of service expected for the processing and delivery of merchandise that include end-to-end tracking and visibility;
  • Move fulfillment of merchandise and goods out of USPS Marketing Mail, consistent with the transfer of fulfillment parcels out of Standard Mail (the predecessor to USPS Marketing Mail) in Docket No. MC2010-36; and,
  • Reduce operational inefficiencies when machines are unable to process letter-size or flat-size shaped inflexible items.”

Roughly 149.5 billion mail pieces were delivered during 2017, of which 58.7 billion pieces were First Class, according to the USPS.

The nonprofit community can comment on the proposal through Oct. 22. Comments can be mailed or delivered to the Manager, Product Classification, U.S. Postal Service, 475 L’Enfant Plaza SW, Room 4446, Washington, DC 20260-5015. Comments and questions can also be emailed to ProductClassification@usps.gov using the subject line “USPS Marketing Mail Content Eligibility.”