Idustry Eye: Shop Talk - Understanding Postal, Letter to the Editor

Letter to the Editor: Inventory Dilemma Calls for ‘Coopertition’
Thank you for putting inventory control at the forefront of All About ROI with Ray Goodman’s article and your Editor’s Take on the subject [October issue, pgs. 30 and 9, respectively]. Annalee Dolls Inc. is a designer/marketer of seasonal decorations, specializing in soft sculptures. We work in multiple channels, directly and indirectly selling to consumers.

It’s been our view for many years now that inventory is the cancer within the fragmented industry of gift and home décor. These difficult times have made it even more challenging to walk the inventory tightrope.

The inventory dilemma brings to light the need for companies within industry segments to work together. Manufacturers, vendors and retailers can no longer expect to thrive by doing their job better than their opposition. Successful businesses must partner with others to mitigate risks and capitalize on strengths. These partnerships have to span vertically and horizontally — with friends and competitors. This is very much at the center of a new buzzword making its way into our marketing environment: coopertition.

To that end, Annalee has devised a marketing concept called circular marketing. It’s based on erasing inventory risks by using multiple channels, including off-price, to move inventory while guaranteeing sales. To the surprise of many full-price retailers, this concept has delivered new customers to them, caused by consumers making a first purchase in an off-price channel and then desiring a better selection and current products.

Bob Watson
Annalee Dolls Inc.

From the editor: We plan to publish a feature about Annalee Dolls’ concept of circular marketing in an upcoming issue of All About ROI.

Understanding Postal: Failed Droop Test Could Wilt Your Postage Dollars
Another recent rule change from the USPS has catalog mailers re-evaluating their designs. The “droop” test is back in full force, with some changes that have mailers concerned they could be facing 40 percent to 50 percent higher postage bills if their mailings don’t pass the test.

The rules affect retailers who mail store circulars via Standard mail as well. Catalog mailers should encourage their printers to find out if their designs are likely to pass the new droop test; if they don’t, the consequences in postage could be huge.

The USPS flats deflection test (aka, the “droop test”) has been in effect for several years. But earlier this year, the USPS revised the rules so catalogs and other flat-sized mail pieces now are required to be even less flimsy than before. The USPS says the change is designed to make the pieces run through its equipment more easily with less damage.

Effective Jan. 4
The new rules take effect Jan. 4, three months later than the original September 2009 implementation date, following protests from mailers and their associations. Many catalog mailers and their printers are re-evaluating their designs to ensure compliance.

The rules apply to all catalogs and magazines except those mailed at USPS saturation or high-density, carrier-route prices. The revision to the rule changes the four-inch droop allowance to three inches and eliminates the current exception for oblong pieces — i.e., those with a bound edge on the shorter side. Oblong pieces could still qualify by adding a tab to the open edges opposite the bound edge, or by other design changes.

Oblong designs aren’t the only ones that risk failing the test. Tabloids, press-pasted mail pieces, pieces with lightweight cover stocks and interior page stocks, even blow-ins, can affect a catalog’s ability to pass the test.

Consequences?
Unfortunately, the USPS has yet to communicate any official information on the consequences of a failed test, how it’ll determine whether pieces have passed the test or any process for pieces to be prequalified prior to production.

—Kathy J. Siviter, president, Postal Consulting Services (kathys@postal
consulting.com).