Post office will carry on, media expert believes By Susan Todd The Star-Ledger
Thomas Harpointer, chief executive officer of AIS Media Thomas Harpointer, chief executive officer of Atlanta-based AIS Media, has a stake in the postal system’s survival.
Harpointer works with businesses to improve their marketing, usually by providing ways to better measure the results of their efforts to capture the attention of consumers. He advocates a multi-channel approach, meaning a mix of, say, direct mailings, e-mailings and other technology.
While the postal system downsizes, Harpointer is optimistic that it will survive in some fashion and, possibly, revamp its business model to reduce its costs and make better use of technology.
When the economy rebounds, companies will resume using direct-mail marketing, one of the postal system’s biggest money-makers, he said.
"Ultimately, as the economy recovers,’’ Harpointer said, "there will be a place for direct mail.’’
Harpointer recently spoke with Your Business about the postal’s system’s struggles and its outlook for the future.
Q. Is the U.S. Postal System another casualty of the internet?
A. The postmaster general went to Congress last year and cited two catalysts for the postal system’s problems, one was the bad economy and the fact that businesses have significantly cut back on mailing and the second is the growing use of e-mail. There’s nothing the post office can do to cut down on the use of e-mail.
There’s just no way around that, especially with the growing use of handheld devices. The problems with the post office started way before the internet became a factor. When the Mail Box Stores and the UPS stores started opening. A worker for the post office made $65,000 and workers in the competing stores would make half that.
The real future of the post office is going to depend on a shift in their business model. As the economy recovers, we do expect to see direct-mail advertising increase. That’s a big money-maker for the post office. The bad news is, it’s going to get worse before things get better.
Q. What are some of the coming challenges?
A. Another large revenue stream for the post office comes from banks that send out statements. Today, only about 20 percent of bank and credit union customers are using e-statements.
There’s a big movement right now among bank associations to help convert customers from paper to e-statements. It’s becoming a national initiative. When the banks become more successful in converting their customers, even if it takes two to three years to get to 50 percent, it’s going to hurt the postal system.
Q. What do you think the postal system will look like in three years?
A. How it’s going to evolve is anyone’s guess. The post office is going to have to help businesses better measure the results of their mailings. Using interactive marketing will improve results of direct mail. It gives the business owner the ability to better track results.
I’m hopeful that’s what the postal service will embrace. What they’re very poor at is educating people on how to effectively use their service. The postal service just exists. It doesn’t provide any education or guidance. It needs to do a better job at educating their customers about how to use their system with digital services. Unfortunately, a lot of businesses take a shot-gun approach.
They create a list and blast out the mailings. Without a strong interactive tie in, they’re just guessing. They have no idea whether the envelopes are ever opened or how receptive the recipients are to the offers.
With an e-mail campaign, we can clearly see how many e-mails were sent and opened and how many clicks the mailing got. I think the postal system, once they change their business model, they’ll be fine, but the post office as we know it is a dead business.
Q. How is your company tied to the postal system?
A. Our clients range from small retailers to Fortune 500 companies with advertising budgets of between $1 million and $10 million. As an interactive agency, we know that multi-channel marketing is more effective.
E-mail brings in about $40 for every dollar spent while direct mail is getting $8 for every dollar spent. That’s very compelling. A lot of businesses today are under pressure to maximize their return on investment.
They’re cutting out radio and print marketing, but it’s not that they don’t work. All of these platforms can work with the right system. That’s what we’re bringing to the table. We hate to continue to beat on them, but you have to evoke change. At some point, a turnaround has to occur. We hope it occurs sooner than later.
•
del.icio.us
digg
facebook
E-mail this article to a friend (requires login).
