On October 10, 2018, the United States Postal Service (USPS) announced a rate increase for 2019. This is the second time in 12 months the USPS has raised its rates. Back in January 2018, Allen Press blogged about the 2018 rate increases and how it would affect publishers and marketers in our industry.
The increased price hike will take effect January 27, 2019. In this blog post, we will break down the pricing increases and what it means to our printing, publishing and direct mail customers.
2019 USPS postage rate change overview
Here’s a quick snapshot of the increases that will take effect in January 2019.
- First Class Forever Stamps will increase from 50 cents to 55 cents
- Priority Mail rates will increase by 5.9%
- Priority Mail Express will increase by 3.9%
- First Class Package service rates will now be calculated based on Zone (like Priority Mail). This service will also experience an 11.9% rate increase on average
- Mailing services product prices will increase by 2.5%
What will the mail increase mean for the print and publishing industry?
Similar to the 2018 rate increases, printers and publishers will have to become familiar with the pricing changes and how their publications are distributed. Cost-saving measures can be taken. A publisher can modify their publication’s page count, frequency and distribution list to offset the postage increase. Additionally, switching paper type, packaging or production specifications are also potential cost-saving strategies.
What does the rate increase mean for direct mail marketing?
It’s no surprise…the direct mail marketing industry will take a direct (no pun intended) hit with these price hikes. In 2018, the USPS raised direct mail pricing across the board, hoping to leverage business and commercial mail to improve revenues. It’s not a bad strategy, as direct mail marketing continues to produce a strong ROI for marketers.
The 2019 postage rate increases will continue to force marketers to be as targeted as possible. Because the variable cost for direct mail is so much higher than email or digital advertising, effective marketers must closely evaluate their distribution lists and cut recipients that fall outside the target market.
2019 USPS rate increases
Here’s a list of some of the increases you can expect to see starting in 2019.
UPS and FedEx also announce rate increases for 2019
It wasn’t just the USPS that announced rate increases. Both the UPS and FedEx followed suit and announced increases for some mailing services.
Effective December 26, 2018, UPS will initiate the following pricing changes:
- The rates for UPS Ground, UPS Air and International services will increase an average of 4.9%
- Fuel surcharges will apply to Additional Handling, Over Maximum Limits, Signature Required and Adult Signature Required accessorials
- A processing fee of $2.00 per package will be charged when Package Level Detail (PLD) is not provided to UPS prior to delivery
- The rates for certain value-added services and other charges will increase
Silver lining… at least the rate increases come after Christmas!
FedEx has made a few immediate changes over the past couple of months with additional pricing increases taking effect in January 2019.
Effective January 7, 2019, FedEx will initiate the following pricing changes:
- FedEx Express package and freight standard list rates will increase an average of 4.9% for the U.S., U.S. export and U.S. import services
- FedEx Ground and FedEx Home Delivery standard list rates will increase an average of 4.9%
- FedEx Freight rates will increase an average of 5.9%
How Allen Press navigates postal changes for our customers
Allen Press mailing expert, Dustin Young, has seen his fair share of postage price increases as well as modifications in USPS regulations. While many organizations will immediately see increased publishing and direct mail expenses, Young stresses that Allen Press is here to help navigate these changes.
“We always sort all of our mailings for the deepest possible automation discount,” Young said. “That will get our clients the lowest possible rates after the increase.”
Young also suggests evaluating the weight of your printed materials to ensure effective cost-savings.
“Customers should analyze strategies to reduce page counts or utilize a lighter paper weight in order to make the mail piece physically lighter,” recommends Young.
Allen Press will continue to track all postage updates and how they might affect our customers. For more information about the postage increases, contact us today.