In its letter to Senators Joseph Lieberman and Susan Collins. the GAO illustrated the seriousness of the Postal Service’s financial problems and the need for a solution that will make most stakeholders uncomfortable in a single chart. The chart is even more disturbing when it is compared to similar volume projections made in the Postal Service’s
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Strategic Transformation Plan: 2005-2006 and the Postal Service’s Action - published September, 2005
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Ensuring a Viable Postal Service for America: An Action Plan For The Future - published March, 2010
In both documents, the Postal Service presented multiple forecasts for the future of postal volumes. In each document, the most pessimistic forecast was the most accurate. The Postal Service would have done a better job preparing for its future if it managed its business based on the pessimistic forecast. Unfortionately, the most pessimistic forecasts were always considered nothing more than another “chicken little” forecast that since the invention of the telegraph had predicted the decline of paper-based communications.
2005 Forecast
2010 Forecast
Forecast Error Due to Changing Economic and Technological Changes
The major error in both forecasts is the Postal Service’s optimistic assessment of future First Class Mail volumes. The impact of electronic diversion of business related mail (i.e. transactions, bills, notices, statements, financial reports, etc.) and the replacement of mail with consumer access to information on line that was previously mailed.
The current forecast that GAO presented for Standard mail is slightly below the forecast of a year and a half ago which suggests . This raises the concern that the Postal Servcie may soon have the same trouble forecasting Standard Mail that it clearly has had in forecasting First Class mail. More information is needed regarding how much of the forecast change since the 2010 forecast is due to the slow recovery and how much is due to technological competition.
Implication of Declining First Class Mail
The mix of mail that GAO presents in its table indicates that well over 75% of all mail delivered to households in 2020 will be advertising. Like the Internet, satellite and cable television, broadcast Television, and Radio, the Postal Service is a communications mode that delivers both content that the recipient wants (i.e personal communications, information, and entertainment) with advertising that was not requested by the recipient but is delivered because it has real value to the sender. In these other modes, the advertising pays for all or a significant part of the cost of the content that the recipient wants.
For most of its history the Postal Service has been similar to all other communications modes that rely on revenue from advertising that the majority of what is sent to, watched, or listened to by the recipient is content. Advertising represented well less than half of what the recipient recieved. This has now changed as advertising now represents most mail received by a household. In 2020, the GAO’s table inicates that well over 75% of the mail delivered to households will be advertising.
Both the Postal Service and the direct mail community has to begin asking how the value of mail advertising will be affected as the share of advertising rises from 50% to 75% of mail received. The Postal Service and advertising mail community may need to consider if efforts are needed to increase the content share of mail to ensure that the advertising that is delivered remains effective.
Two things stand out when looking at some of these projections. First, the impact of the recession is repeatedly minimized. Demand is significantly down and one place that is likely to be is the advertising market.
Also, the three year and counting panic mode of the Postal Service ought to have those who utilize the system questioning whether they will need to find alternatives. The market has been completely destabilized by the way postal management and Congress have handled this. The volume projections may be a self-fulfilling prophecy.
I wonder if the situation might not look very different were there even a hint of consistent leadership coming from Washington.
I think it is funny when I look at these charts maybe we are missing something here. Last year we had 1 or two tubs of flats per route and maybe two trays of dps mail and some parcels. This year we have 6 to 8 tubs of mail on each route per day and 4 too 8 trays of dps. Parcels galore so where are they getting these numbers or maybe the mail I see is imaginary. you keep telling the same lie over and over and sooner or later people believe it. Maybe my office is the eception too the status quo!
i agree with you totally amazing huh how they come up with these graphs????
I find it hard to believe that mail volume will
go down as thousands and thousands of people
pour into the our country from the Middle East,
Mexico, South America, China etc., etc.
These numbers could not be real.
Wow look at all the pretty graphs. It’s very easy to use a computer to manipulate an appearance to convey your results to fit your needs. It’s called smoke and mirrors. You notice they don’t let the public know that the USPS only processes 17% of the letter mail. The other 83% of the letter mail is being processed by the big mailing houses and with huge, huge discounts. Oh yeah and your right about the increased mail volumes we are seeing. But again they don’t want you to know the real truth. Again using a computer and pretty graphs, they can show the mail volumes are declining. The truth of the matter is that they are shutting down the AFCS machines in processing plants by 10PM or 11Pm to make it look as if they are efficient. Then the rest of the mail is being held or shipped out not cancelled. So again if the mail is not being cancelled correctly it’s not being counted. Again smoke and mirrors leave the magic tricks to the magicians.
Yes, parcels are going up. I also deliver many more magazine subscriptions than 2 years ago. What I do not understand is if so many people are loosing their homes and jobs, why would they have the inter-net? If a person is trying to save money, the first thing I would think would go would be gym memberships, cell phones, cable and of course the internet. These are all extras.
Can you please tell me why is it when I post blogs that state the truth they don’t post them. I quess someone dosent want the truth to be told.
Your comment has been posted. Just a little slow.