Hauser Group News

OVERVIEW

The overall mail delivery for on-time delivery based on clients perceived in-home windows of 3-5 days was at 65% for the entire year of 2012. The strongest delivery period was 2^nd quarter of 2012 where the mail volume was lighter than the other 3 quarters and there were no significant weather related problems. Delivery on time was even higher in Mid May at over 70% where the volume was lighter and the postal vacations were not in effect yet. The USPS did a much better job of processing mail in April 2012 then in previous years. This is typically a time period where the IRS mail has superceded all standard mail but we did not see that much of a decline of on-time delivery.

The weakest time period during the year was the 3^rd quarter as volume started to significantly pick up after Labor Day. The week of Labor was the 2^nd least effective in-home week during the year only followed by the last week in November directly after Thanksgiving. In both cases, these were also the highest mail volume weeks during the year. The 4^th quarter had some of the biggest drops of in-home window accuracy as Hurricane Sandy seriously affected delivery in the Northeast. Yet, the near 70% delivery during the light periods in December kept the 4^th quarter ahead of the 3^rd quarter for the year. First quarter delivery was uneven as there were some regional snowstorms in areas that normally never receive snow which caused lateness.

FIRST QUARTER

On a regional basis, we saw trends throughout the year. The Mid Atlantic states struggled with on-time delivery in the first quarter, as there were some snow storms in those areas. Those same areas did rebound and reach better on-time status for the rest of the year. Random areas like Grand Rapids, Louisville and most areas in New Mexico saw the weakest on-time delivery for 1^st quarter. St Paul area which included all 550 and 551 areas had an incredible 85% delivery time. We had 31 decoys in that area and showed that high an on time delivery percentage.

SECOND QUARTER

During the 2^nd quarter, on time delivery was more solid and the performance of the USPS was at it’s peak for the year. We saw unusual lateness in a lot of areas in Kentucky as well in specific cities such as Miami, New Orleans, Richmond and Baltimore. The best delivery areas were in Pittsburgh, Buffalo, St Paul, Green Bay and Minneapolis. The amount of mail was down about 9% from 2011 volumes which helped make the post office’s job easier. The decline is based on list rental data we saw on like lists from year to year.

THIRD QUARTER

The 3^rd quarter suffered mainly due to the surge in volume in September. We saw 13% more mail on like lists from 2011. Mailers continue to cut back in summer in favor of mailing in the peak periods and more testing has been occurring in this time period. The unusual drops occurred in Pittsburgh which dominated the 2^nd quarter. We consider Pittsburgh to include 150-156 and 160-161. A lot of the drop in on time delivery occurred outside the city zip codes. New Haven, Western Massachusetts and Staten Island all saw major drops in performance in 3^rd quarter. The drops in Staten Island were before the Hurricane. Top performances were in Wichita, Vermont, Charlotte, Raleigh and Jacksonville. In catalog delivery, many of the top catalogs were in-home at the same time in middle of September which possibly lead to some markets losing track of what came in first and what came in later.

FOURTH QUARTER

The fourth quarter was hampered by Hurricane Sandy in many Northeastern markets. The delivery problems for that region were widespread throughout early November. Long Island, Brooklyn, Staten Island and Westchester were all among the most prominently late areas for the 4^th quarter and much was due to the hurricane.

Cincinnati, Atlanta and Seattle were other areas that faltered heavily during the holiday season. Best performers were Memphis, Arkansas, Chicago and Charlotte for the 4^th quarter. Mail volume during middle December was lower than last year, but the volumes in October and November were 6-8% higher than 2011, with late November up 13% over last year based on like lists.

LOOKING AHEAD

It seems that the best delivery time period is in the 2^nd quarter, where there are vacuums of dropped volume where exposure is greater and delivery is stronger, which could be the best opportunities to try test mailings, launch new product lines, and experiment with new list sources. The USPS is more sensitive than ever to volume driven time periods and weather related problems, which are usually at the peak of the mailing season. To achieve better on time mail delivery, it will be crucial to work closely with the distribution planning as the delivery performances in certain areas are very sensitive to volume. Mailers may need to add more lead time from entry point to achieve more optimal delivery. Early delivery was not as big a problem in 2012 as it had been in 2010 and 2011, which can afford mailers to be more liberal in lead time to the distribution centers.