Measuring the Impact of Mail Pooling and Co-Mailing on Catalog Postage Costs, Part 1 of 2
In the first of this two-part series on helping catalogers realize maximum postal discounts, I’ll examine the various techniques you can use to save in postage — including co-binding, co-mailing and mail pools.
Last year’s postal rate increase of almost 10 cents/piece left catalogers scrambling to offset the impact to their bottom lines. For many, printing has become an area to trim costs. Printers can deliver postal savings when mailing from their plants. Increased attention is focused on mail pool and co-mail programs. Postal savings can be realized in three unique ways:
1. Weekly destination-entry, drop-ship mail pools. Catalogers bind and address the books themselves. Then their mail is combined on trucks shipping to bulk mail centers (BMCs) and sectional center facilities (SCFs) to realize destination-entry postal discounts.
2. Co-bind pools handle the mailing of streams for multiple customers. Combine them into one; then all the participants are bound and addressed on the same binding line.
3. Co-mail pools where catalogs for each participant are bound at the printer but not addressed. Mail files for all participants are combined into one large file, and the catalogs are then placed on offline co-mail machines to be addressed and mailed in a single mailstream.
Weekly destination-entry mail pools have been used for a long time. This is when printers combine all their bulk mail in a week and truck it to BMCs and SCFs around the country. Mailers realize substantial savings, ranging from 4 cents to 7 cents per book in net postal savings, after paying the printers’ freight and administrative costs.
When searching for a new printer by comparing a potential printer with your existing printer, ask yourself two questions:
* How big is your weekly mail pool? and
* How much will I save in destination-entry discounts?
Mail pools offer more potential savings than co-binding and co-mailing; the savings are easier to estimate. Therefore it’s necessary to get a tight-cost estimate for mail-pool savings.
Co-binding and co-mailing are newer technologies being offered to catalogers, and printers are scrambling to add these programs. The difference between co-binding pools and co-mailing pools is co-binding requires two companies to combine their mail tapes and bindery runs. Because only two companies typically can co-bind, the potential postal savings are typically less than with a co-mail pool. Offline co-mail pools combine up to 30 catalogs in a weekly pool. But one drawback to offline co-mailing vs. co-binding is ink-jet information is limited to the outside back cover only.
On average, catalogers save approximately 2 cents/catalog mailed net of the co-mailing charges when co-binding or co-mailing.
Next week, in the final part of this two-part series, I’ll discuss how to compare the differences in postal costs when comparing printers.
Jim Coogan is president of Catalog Marketing Economics, a Santa Fe, N.M.-based consulting firm focused on catalog circulation planning. You can reach him at (505) 986-9902 or email@example.com .