Welcome to the Talon Mailing & Marketing December 2004 Newsletter:
The U.S. Postal Service says a price increase will not occur -- at least not until 2006.
"Prices will stay the same next year" Gerry McKiernan, spokesman for USPS, told CNN/Money. "And that's a guarantee."
The Wall Street Journal reported earlier that the USPS is expected to ask for a rise in postage stamp prices early next year of at least 10 percent -- possibly increasing the price of a first-class stamp to at least 41 cents from 37 cents.
The possible rate increase stems partly from the failure of proposed legislation that would have allowed the post office to take advantage of pension-fund savings, the paper said.
McKiernan said the company has not ruled out a possible price increase, but the process to request such an increase and have it approved can take as many as 18 months. The government-sponsored postal services company has not yet started the process, he added.
The last price increase occurred in June, 2002 when the first-class postage rate jumped to 37 cents from 34 cents. Prior to that, the rate had stayed unchanged since its 1-cent increase in 1999.
The USPS has also faced a decline in market share as more and more customers prefer e-mail and online bill payments instead of using traditional mail services, said McKiernan.
"First-class mail showed a 1 percent decrease over the past 12 months," he said.
Oil prices, up sharply from a year ago, but down from the highs hit in October, may play a key role in its decision to apply for a rate increase, said McKiernan.
"We have more trucks on the road than anybody. High fuel and gasoline prices can easily influence our bottom line," he said.
Transport competitors, such as FedEx Corp. (Research) and United Parcel Services Inc. (Research), have also increased their prices in recent years.
"Fuel prices go up, and they have to try to offset that with something," said David Campbell, analyst at Thompson, Davis & Co. "It's not a business where costs stay the same every year."
FedEx and UPS will raise their rates at a roughly 3 percent next year, said Campbell. "They have raised about 5 percent so far this year because of high fuel prices."
The state of California has passed a bill called Senate Bill 27 which could impact organizations who rent or exchange mailing lists and/or consumer data. The new law will go into effect starting January 1, 2005.
The bill states that an organization must supply to any consumer who requests it, an explanation of what data has been shared and a listing of each of the third-party organizations the data was shared with. Organizations must comply with the request within 30 days. Failure to comply within 30 days means individuals will be able to seek injunctive relief and civil penalties of up to $3,000 per claim.
With regards to list rentals and list exchanges, while this is a burdensome task, rest assured that Talon has already set up a system to retrieve a consumer's usage history and we will provide that information if the mailing list is housed at Talon.
There is a way to eliminate having to send information to consumers. Jerry Cerasale of the DMA advises the following:
If you are concerned about complying with this new law, the simplest approach is to offer your customers an opportunity to opt out.
If your list(s) are housed at Talon we can accommodate requests and issue usage reports within a day or two of the request.
Talon would like to welcome the following new clients this month to our growing roster of clients:
New Mailing Lists Housed at Talon (we house over 600 mailing lists)
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