Hauser Delivery & Industry Trends Newsletter

OVERVIEW

Mail delivery from February to May 2004 was up and down. Most of the volume of the mail was sent in Late March and mid to late April. The best delivery patterns were witnessed in May as the system was cleared of large volume mailings.

The USPS system struggled as usual during the IRS income tax season whereby the sheer number of late filers this year surpassed any previous year. The delivery patterns surround April 15^th were off by 3-5 days for most mailers regardless of size or circulation of the mailing.

In late March, there was a great number of political mailings in the postal stream as Democrats and lobbyists rallied to direct mail to gain support. These large volume drops seemed to have great impact around that time period.

Areas such as Atlanta, Houston, Northern California and Seattle struggled more with on time delivery during these peak volume and workforce time slots. In those areas it seemed that we saw a larger percentage of non delivery for postcard mailings. The chief reason for the non delivery is that the postcards are lost inside other pieces of larger deliverable mail.

As we approached May the mail volume seemed to reduce significantly as many mailers cut back on volume or eliminated unproductive drops from their mailing plans. The total mail volume in 2004 seemed to be 5% less than in 2003, which helped bring response rates up for most mailers, despite poor economic and political conditions.

LOOKING AHEAD

The second half of 2004 should be a lot more challenging. The mail volume will certainly increase over 2003 by 20%. The Olympics will be a major distraction to response rate. The political conditions around 6/30 can impact mailings in a significant manner. Mail delivery will be somewhat hampered by the volume surges, and the mailing schedules.

Many mailers have similar schedules for their drops as to avoid the Olympics and avoid the election. In Presidential Election years, the response rates are usually poor if the incumbent wins. The anticipated Bush victory will lead to a poor responding week ensuing the election. Given the fact that there are set times "not to mail" the congestion level of the post office will be great forcing some seriously slow delivery in the larger markets and higher volume SCF’s.

It is best to look at 2000 in order to plan for this year as there were the same distractions. Even in 2002, mailers drove their schedule off of "avoiding the week of 9/11" this forced competitive congestion at an alarming rate in the mailbox. The mailers who ignored this logic actually saw more of a lift in their response as a result of being isolated in the mail stream.

At this point, managing order flow day to day will be imperative as to look towards the daily climate in the world and the tangential distractions. The gift buying season will be heavier towards the end of the season this year as like last year, as many customers are pensive about the economy. The mail delivery later in the season should crawl.