Full-Service Intelligent Mail – What’s really in it for the community newspaper publisher?

By William E. (Bill) Garber
Interlink Founder and Chairman

All calculations start with the 14 cents per subscription that adding Full-Service Intelligent Mail will add to Interlink’s annual license fee.

Savings from just Automation Rate discounts that require Full-Service Intelligent Mail as of Jan. 26, 2014, will exceed the Full-Service Intelligent Mail cost differential for more than 90% of Interlink clients.

In short, when considering only Automation Rate discounts, 90% of Interlink clients will pay less cash out in 2014 while using Interlink Circulation than if Interlink had kept its 2013 license rate and had not included Full-Service Intelligent Mail.

However, total savings is a more complex measurement. And, a much higher number. Let’s be more specific.

  • Address Change Service (ACS).
    • Savings from one yellow sticker per week at 55 cents per sticker: $28.60 annually.
    • Retained $39 subscriptions due to electronic address changes after the first week, rather than after the 10th week using the yellow sticker service, estimated at only one subscription saved every other week: $1,014 annually.
  • Full-Service Intelligent Mail is implied to secure new USPS service level standards for newspapers.

    Without Full-Service Intelligent Mail sack and tray tags, newspaper mail can be expected to suffer increasing delays at random intervals. With delivery issues being the number one cause of distant subscription renewal failures, it is realistic to expect that Full-Service Intelligent Mail will retain distant subscriptions at least equal to the number of subscriptions retained by switching to electronic ACS: 26 at $49 annually, or $1,274.

    Let’s keep in mind there were two million Full-Service Intelligent Mail mailings last year. So this is not some untried imaginary system, but a system with proven design benefits that for the first time in history are not dependent on increasing mail volume, but come into their own even more so as mail volume declines, as it has been for some years now.

  • Full-Service Intelligent Mail is the critical path to cost reductions within the Postal Service.

    CASS processing is designed to accurately identify the destination of each mail piece and to sequence pieces within a bundle with precision. This is how to reduce handling costs in a delivery system with fixed staffing levels.

    Full-Service Intelligent Mail is how to predict staffing levels required on a per-shift, per-facility basis. And, for the first time in history, the Postal Service has a workforce that is sufficiently flexible that it can staff to volume rather than facility. With 80% of delivery cost accounted for by the workforce, this is how to keep delivery costs in line with declining mail volume. If Full-Service Intelligent Mail succeeds in minimizing postage increases by just 10% going forward, the annual community newspaper savings will be: $20 weekly, or $1,040.

    It is encouraging to keep in mind that UPS and FedEx can nearly double their workforce during the holidays and just as reliably deliver more than twice the number of packages using the same technological approach that Full-Service Intelligent Mail is built on. With the Postal Service delivering more items every two weeks than FedEx and UPS combined deliver worldwide in a year, Full-Service Intelligent Mail has the potential to keep postage low while dramatically improving service level standard compliance.

On the basis of these three benefits, total annual value to the typical community newspaper will be over $2,200 in retained subscription revenue and $1,000 in reduced postage going forward, and that is in addition to the Automation Rate discounts previously recognized and in 90% of the cases has already paid for the new Full-Service Intelligent Mail capability in Interlink Circulation.

Keep in mind that Full-Service Intelligent Mail has been added to Interlink’s historical 2008 license fee for just 14 cents per subscription, or $210 annually for a 1,500 subscription community newspaper on which the above figures are based.

Like a community newspaper subscription itself, we believe the value of the 14 cents per subscription that Full-Service Intelligent Mail adds to Interlink’s license is actually a pretty amazing value.