Pony Express Rides Again

(Into Oblivion)

The following is a perspective by postal commentator Todd Butler, CEO, Butler Mailing Service. The views expressed here are solely the author’s and do not necessarily represent the views of the Association for Postal Commerce.

The Pony Express rode into oblivion in late October 1861. It was replaced by high-speed communications… the telegraph. The Pony Express was too slow and costly, compared to its on-line competitor, to deliver value to its customers. Eric Hadley, director of marketing at MSN, has stated that “of all the media options available to marketers today, online offers the richest palette for reaching consumers with sight, sound, motion and interactivity, combined with high-end demographics...” Obviously our on-line competitors see little relevance in ink on paper advertising or any value in hardcopy delivery. They see the United States Postal Service as too slow and costly, unable to deliver the media options relevant to today’s markets.

Clearly the survival of the Postal Service is dependent on its ability to deliver relevance and value to its existing customers, while generating increased revenues and growth through new customers. So how is postal management positioning this venerable institution? Over the last several years the marketing team has concentrated on touring the south of France and three products: Click-n-Ship, cardboard doughnuts (or puppies) and yellow post-it notes. Though interesting, no one believes that these new products have the potential to provide the necessary revenues or growth needed to meet the needs of the Postal Service. Nor can these products compete with multimedia advertising on the Internet.

Management must do better than paper dolls… excuse me paper dogs, in delivering value to its customers. Hope of enlightened leadership fades after viewing their award winning Mailtown USA interactive CD. On it the Postal Service proclaims that mail is interactive because customers open an envelope. While the director of marketing for MSN is reaching out to customers with sight, sound, motion and the interactivity of the Internet, postal marketing is promoting the interactivity of removing a sticker from a piece of paper or clipping coupons. The obvious irony is that this marketing team is utilizing sight, sound, motion, the interactivity of an enhanced CD and being on-line (required to run Mailtown USA) to tell customers that opening an envelope is as interactive as mail can get!

It’s no wonder our competitors laugh at us. For years they have been using the Postal Service to distribute millions of enhanced CDs to promote and grow their on-line offerings. AOL has used enhanced CDs so successfully that they were able to buy the media giant Time Warner. And while AOL was growing, the Postal Service was losing volume, revenue and customers. Instead of promoting successful ideas and expanding their customer base, postal management has delivered yellow t-shirts, post-it-notes and another double digit rate increase.

An enhanced CD in the mail stream is called Multimedia Mail. If postal management decided to distribute Mailtown USA to customers using its letter carriers (instead of an alternative delivery method) it would be an excellent example of Multimedia Mail. When the Postal Service delivers Multimedia Mail, it is delivering better video than broadcast TV or the Internet, better sound than radio, the same animation, multimedia programming and connectivity as on-line advertisers. Best of all Multimedia Mail is hand delivered, targeted and a powerful multiple-media package not available from its competitors.

Not only does postal management not comprehend the potential of Multimedia Mail, they are blind to using it in developing new customers. Ever since the advent of the Tivo DVR, major TV advertisers have been concerned about consumers skipping their commercials. They are looking to reallocate resources in an attempt to avoid the consumers’ “SKIP” button. In an effort to increase the value of TV commercials, these same advertisers want to use database techniques developed by the direct mail industry to target commercials to specific households. Cable companies have promised to deliver the necessary addressable medium through their set top boxes.

Hello! Reallocation of resources, addressable medium, database marketing and marketing messages targeted to specific households, this sounds like DIRECT MAIL. Multimedia Mail is the obvious solution to these advertisers’ needs.

How big could this market be?

· October 18, 2004 -- The Financial Post “Forrester Research, the Boston-based technology research company, found in a recent study that 93% of U.S. advertisers are interested in targeting their television ads to individual households."

The Postal Service’s response… another year of cardboard doughnuts.

And Cable company’s response?

· October 18, 2004 – AdAge.com “Ford Dealers Test Addressable Cable TV Ads” “…addressable cable TV ads can be targeted more precisely using household demographics such as gender, age and income…” The article goes on to say that about 35% of cable subscribers can be targeted now but that by 2006, 70% of cable subscribers will be able to be targeted with specific commercials.

How should the Postal Service respond? (Better late than never!)

PMG Jack Potter should take personal responsibility and march into the major on-line and TV advertisers and tell them that the Postal Service has the addressable medium they desire, NOW! That our industry can deliver interactive video and multimedia programming at a better value than broadcast or cable TV. He could tell them that Audi mailed this type of package with 18% of the recipients signing up for a test drive! That’s delivering value and no one can deliver customers to the Internet like the Postal Service!

Eric Hadley’s belief that “online offers the richest palette for reaching consumers…” is delusional. The Postal Service, utilizing enhanced CDs and hardcopy delivery, is the best way to reach targeted consumers with interactive multimedia. Only the Postal Service can deliver mailbox to web connectivity, providing one-click access to on-line resources. Only the Postal Service can turn the “mail moment” into the “Internet hour”. Only the Postal Service can deliver your sliver of the Internet to any delivery stop in the USA.

The Postal Service needs leadership and an aggressive marketing team to communicate that its new core competency is delivering digital data and one-click access to the Internet, and that no one does it better! Those thundering hooves you hear can either carry us into oblivion like the Pony Express or we can ride them into the future, delivering the targeted digital products advertisers are demanding.