Is USPS's Critical Mail a sign of deeper changes to come?

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February 27, 2011
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March 2, 2011

Is USPS's Critical Mail a sign of deeper changes to come?

USPS recently announced the introduction of Critical Mail. By introducing 'high-speed' products for special situations, USPS may set the stage for slowing down the rest of the mail, reducing operating costs, and hopefully maximizing reliability at the same time.

USPS recently announced the introduction of a new product line, Critical Mail.  Tailored for customers requiring mailing solutions for important documents, Critical Mail, may forebode the shift of USPS’s business model away from volume-driven revenues and toward value-based offerings (a recommendation we made in an earlier blog) .  The USPS suggests that Critical Mail will be valuable in a number of ‘situations’ such as event tickets, identification documents, stored-value cards, education transcripts, or urgent direct mail messages, suggesting the ‘contextualization’ of the transaction between sender and receiver.  We have long advocated that not all mail is equal, and that USPS must better understand the ‘purpose’ of the transaction in order to better serve its customers. USPS’s Intelligent Mail platform is ideally suited for this purpose.

Along this train of thought, one wonders if the introduction of Critical Mail may not precede and predict a change in overnight commitments for the rest of the mail.  In an age of instant communications, our market research indicates that mailers prefer consistency of service over speed.  Our analysis further shows that reducing overnight mail delivery commitments for the majority of first class mail (and often standard mail) may significantly reduce operating costs. By introducing ‘high-speed’ products for special situations, USPS may set the stage for better adapting its service standards to today’s customer needs, thus reducing operating costs and  hopefully maximizing reliability at the same time.

 

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