when postage rates rise, find hidden value in paper

The cost of a first-class stamp went up to 39 cents earlier this year, with presorted and bulk mail rates following suit. For companies that mail high volumes of bills and statements, the financial impact will be significant.


An overwhelming majority of utility customers still prefer to receive their statements in the mail.
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Some analysts may point to electronic bill presentment as a way to sidestep these increases, but the fact remains that an overwhelming majority-between 85 and 90 percent-of utility customers still prefer to receive their statements in the mail and to pay bills with a paper check. The reason? Customers have little incentive to change their habits and often find e-billing confusing and time-consuming.

Utilities may feel that they are caught between a rock and a hard place but there is hope. Smart utility companies will find hidden value in their paper processes by looking more closely at the value of printed statements and the reliability of the U.S. Postal Service.

deliverability and automated tracking

E-billing may someday provide significant cost advantages to billers, but until customer adoption is more fully developed it is wise to look at the many advantages of issuing statements and bills via P.O.P.- plain old paper.

Electronic payments can certainly serve to decrease postage costs, but in the jump to save, companies may find they lose inherent advantages found in tracking paper. And, while the use of electronic statements is growing, the savings available are still contingent upon customer adoption. So far, the volume is far too small to offset increasing mailing costs. Meanwhile, utilities can find advantage and innovation using some of the tried and tested mechanisms developed over time in the printing and mailing industry.

Deliverability is one consideration that is often overlooked in the buzz about e-billing. When an invoice is put into the mail stream there’s a high degree of certainty that it will be delivered. The Postal Service has a long history of reliability, but with e-mail that claim cannot yet be made. Anti-spam filters, system outages and constantly changing e-mail addresses combine to make e-delivery a less-than-certain process providing less-than-acceptable peace of mind for high-volume billers.

Tracking is another benefit of paper billing. The Postal Service offers highly developed tracking mechanisms that help ensure mail pieces don’t get lost in the delivery process. By using Confirm, an automated tracking methodology from the Postal Service, along with “Planet Code”-a barcode applied to every mail piece that is scanned and documented at each postal facility-utilities can obtain daily updates on the progress of individual statements or invoices that enter and move through the postal system.

These advanced tracking capabilities often provide unrecognized value. Companies can verify mail delivery and synchronize those deliveries with coordinated telemarketing or other promotional efforts.

one-to-one marketing within reach

Printed statements are one of the main, if not the only, points of contact between a utility and its customers. Utilities that issue thousands of statements per week should view these documents as a source of value and new revenue rather than simply “the cost of doing business.”

Statements, unlike other forms of mail, are always opened, most often read, and commonly kept on file. That makes them worth their weight in marketing gold for cross-selling and up-selling new and additional services to existing customers.

With the advent of digital printers and advanced database systems, the promise of one-to-one documents that perform far beyond generic junk mail is within reach. With selective data mining and thoughtful document composition it’s possible to produce statements and bills that command dramatically improved customer response, becoming contenders in successful marketing campaigns.

Rather than viewing printed statements as an expense to be avoided, utilities should leverage their investment and realize the full promise of document personalization and one-to-one marketing.

overlooked expert resources

Traditionally, utilities have maintained the systems to print and mail their statements internally. But not every utility can be an expert in postal discounts, mail piece tracking and document composition. Outsourcing is one way to access these expert skills while eliminating the need to maintain a large investment in staff, technology and process development.

But whatever approach is taken when it comes to “getting the bills out” utilities should continue to look toward the future promise of e-billing while maintaining a close watch on the advantages found in the traditional paper billing process.

Harry Stephens is president and CEO of DATAMATX. For more information about DATAMATX, visit www.datamatx.com or call 800-943-5240.

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