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Direct Marketing, Advertising & Publishing Line of Business NAMMU Mailing Industry Forum 19 September 2007

Direct Marketing, Advertising & Publishing Line of Business NAMMU Mailing Industry Forum 19 September 2007. Guiding Vision.

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Direct Marketing, Advertising & Publishing Line of Business NAMMU Mailing Industry Forum 19 September 2007

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  1. Direct Marketing, Advertising & PublishingLine of BusinessNAMMUMailing Industry Forum19 September 2007

  2. Guiding Vision Canada Post will be recognized as the foremost driver and enabler of effective and results-proven Direct Marketing in Canada, helping companies grow their businesses while serving as an industry leader in consumer knowledge, consumer protection and privacy, and multi-channel direct marketing delivery.

  3. 5 Key Trends Impacting the Mail Industry • Government Legislation & Social Advocacy • Privacy, Spam, Do Not Call, Environmental • Technology Advancements • Changing how marketers market – speed, channel, production processes, integration, data management • New Media / Channels • Fragmented media landscape • Generational Changes • ‘Net Gen’ driving difference in media consumption pattern • Marketing Effectiveness – a growing Board Focus • Marketing impact on bottom line

  4. The Future Marketing Landscape … • Channels will look different due to technology advances • Facilitating ‘conversations’ between consumers and companies • Highly Interactive Media • Highly competitive media environment • Measurement of response/engagement across all media; • Customer insight & targeting more refined; • Consumer in control … • “Pull” not “Push” marketing; • Demand choice of channel for receiving information • Need for simplification (information management) • Marketer’s Future Reality: need to actively manage the customer experience • Highly customized 1:1 communications (content, offer, timing, channel) • “Event Triggered” contact strategies

  5. Growth of Mail Improving efficiency & effectiveness Relevance Direct Marketing - Our Priorities

  6. Product and Price Changes - January 14, 2008 • Addressed Admail Adcard • Unaddressed Admail • Business Reply Mail • Publications Mail • Catalogue Mail

  7. Product Changes and Enhancements • Increased size flexibility in Unaddressed Admail • Residential and Business specifications - Letter Carrier Standard items - up to 115 g: 12” x 6” (3 days) - over 115 g: 12” x 6” (5 days) -Letter Carrier Oversize items - up to 115 g: 12” x 9” (5 days) - over 115 g: 12” x 9” (5 days) - Non-Letter Carrier Standarditems - up to 500 g: 12” x 6” (1 day) - over 500 g: up to 1000 g 12” x 6” (3-5 days) - Non-Letter Carrier Oversizeitems - up to 500 g: over 12” x 6” up to 14 X 11” (1 day) - over 500 g: up to 1000 g 12” x 6” up to 14” x 11” (3-5 days) NEW 15

  8. One indicia for multiple services - the design and specifications allow for increased flexibility Product Changes and Enhancements • New Generic Indicia with Perforated Edge Design • Addressed Admail, Catalogue Mail, Lettermail and Publications Mail Simply add the name of the service and your Customer Number or Agreement Number (as required) to the artwork according to the instructions available by selecting "Postal Indicia" from our website at www.canadapost.ca/postalservices 19

  9. Adhesive notes (sticky notes) allowing advertisers / customers to affix a message to the outside of the item Product Changes and Enhancements • Repositionable Notes (RPNs) • Addressed Admail, Publications Mail and Unaddressed Admail including AdCard • Provides marketers with innovative, creative options to stand out and increase response rates • Notes can be repositioned on a refrigerator, computer or telephone as a reminder or for future reference after the mail item is discarded • Direct Marketing application for all industry sectors 18

  10. Product Changes and Enhancements • Undeliverable publication notification • New automated process for Publications Mail • Current process • Canada Post removes covers and address labels from undeliverable Publications Mail items for return to Publishers • Publishers do not receive the information in a timely manner New process • Address label information will be data entered into a new application • Publishers will receive a secure weekly report of undeliverable addressinformation via email and PosteCS • Billing will be automated 16

  11. Product Changes and Enhancements • AdCard • AdCard for Addressed Admail and Unaddressed Admail • Lower minimum order volumes: from 5,000 to 1,000 items • Two new price steps will be introduced to accommodate • 1000 items up to 2,499 items • 2,500 items up to 4,999 items • Extended to credit card as a method of payment 17

  12. Product Changes and Enhancements • Presort Strategy Phase 2: Brick-piling • Publications Mail and Addressed Admail • For larger mailers: 10,000 per mailing or more • To improve efficiency and service by increasing number of direct downstream pallets and reducing bags and monotainers • Features: • Reduced fill heights from 50cm to 30cm (national) and 15cm (local) • Access to levels 3 (DCF) and 4 (FCP) • Access to Canada Post reusable plactic pallets • cost and hazard reduction of wooden skids…and greener • easier handling (4-way entry, light, nestable) • meet current and future mail prep. specs. • $2 per use fee effective October 1, with 30-day free trial for new users 16

  13. Product Changes and Enhancements • Changes to edgemarking • Short & Long and Oversize presort items • Addressed Admail, Publications Mail, Lettermail Presort and Lettermail Presort Local Current edgemarks • Acceptable to identify the end of the container but should not be placed in either of the locations reserved for the Delivery Mode Direct or Delivery Facility mark New edgemarks (in addition to the current process) • Allowed to identify the beginning or end of a container by edgemarking two envelopes (items) in a row at the same location as is used for the Delivery Mode Direct or Delivery Facility mark 13

  14. Product Changes and Enhancements • Reduced container weights from 25kg to 22.7kg • Addressed Admail, Business Reply Mail, Catalogue Mail, Lettermail and Publications Mail • Aligns with CUPW Collective Agreement • Unaddressed Admail to be implemented at a later date 12

  15. Important Reminder • Business Reply Mail • 4-state barcode mandatory as of July 16, 2007 at which time the 93-symbology to be out of spec at $0.10 surcharge • New BRM Artwork Online Tool enables customers to download and print the BRM overlay label to fit on a standard 2”x4” label and stick or glue the label over the BRM address and old 93 symbology bar code, ensuring the BRM indicia with the three bars and chevrons are not covered • Benefits / Application: • Enables customers to recycle and update their supply of BRM cards and envelopes that depict outdated artwork. For example: old bar code 20

  16. Important Reminder BUSINESS REPLY MAIL (BRM) - Reminder Business Reply Mail Altering the BRM address and/or postal code provided by Canada Post might result in the following: • 10 cent surcharge per piece • Slow response time • Items sent to the Undeliverable Mail Office (UMO) • Items not accompanied by a packing slip making tracking of a campaign response laborious • Restrictions on BRM Artwork Online Tool • Cancellation of BRM Contract Agreement

  17. Overview - Price Changes • Addressed Admail • Overall weighted average increase 3.2% • 1¢ increase on S/L and 2¢ increase on O/S • Addressed AdCard • No price increase (0% in '07) • Catalogue Mail • Overall weighted average increase 3.6% • Business Reply Mail (BRM) and International BRM • Annual fee increase from $575 to $600 (4.3%) • Per item fee increase of 3.2% • Overall BRM fee and per item increase 3.3% 6

  18. Overview - Price Changes (Cont’d) • Unaddressed Admail • Overall weighted average increase 4.7% • Non-contract price weighted average increase 4.1% • Contract price weighted average increase 4.3 % • Transportation fee weighted average increase 11% • Oversize Unaddressed Admail being introduced in urban areas • 1¢ premium over standard prices, for both urban areas (new) and rural areas (existing) • Unaddressed AdCard • Overall weighted average increase 3.5% 7

  19. Overview - Price Changes (Cont’d) Publications Mail • Overall weighted average price increase of 4% • Increase on base price ranges from 0 cents to 2 cents • No price increase for Samples and Bundles of Unaddressed Copies • Undeliverable Publications Mail returns price increases to $1.00 (from 97¢) to reflect service improvements 8

  20. Overview - Price Changes (Cont’d) • LCP price restructure • Publications Mail • Introduction of a distance-based Letter Carrier Presort (LCP) price structure without price differentiation (in response to customer / association feedback) • Provides an 18-month lead time before price differentiation takes effect in January 2009, allowing our customers time to assess their National/Regional/Local mix and evaluate optimal mail induction point(s) • New structure enables our customers to choose between convenience (national mailing) and mailing cost optimization (drop shipping) 10

  21. *Phantom charges will be based on theLocal DMD base price. Overview - Price Changes (Cont’d) • New Publications Mail pricing structure with • no price differentiation for 2008 • Applies to Publications Mail LCP mailings only • Local - destination city* same as originating city • Regional - destination province* same as originating province • National - anywhere else in Canada that is not deemed to be Local or Regional • **Some exceptions accounted for in SERP e.g., Atlantic provinces are Regional • No operational or mail process change for customers: pricing logic is embedded in software (SERP or In-house) 9

  22. The upcoming changes were postedon the Canada Post website on July 6, 2007Click on the icon: “Service and price changes effective January 14, 2008” For more details…. 21

  23. Other Product Enhancements Optical Endorsement Line (OEL) Pilot for Publications Mail • Current Specifications for a DCF Bundle Label 16

  24. Other Product Enhancements Optical Endorsement Line (OEL) Pilot for Publications Mail Proposed OEL option for routing information on address label / mail piece • Benefits • Cost reduction • less paper • less handling • reduced errors • Service improvement 16

  25. Other Product Enhancements • Expanding access to mailing agreements • Publications Mail • Currently only publishers may hold agreements for Publications Mail • Proposed change to business practice to allow intermediaries to hold agreements • Aligns with Addressed Admail • Exceptions: • Volume discounts • Publications Assistance Program (PAP) • Proposed for this fall, pending final approvals 16

  26. Growth of Mail Demonstrating the value of direct marketing and direct mail Ease of access & use Improving efficiency & effectiveness Data Targeting & Hygiene capabilities Performance improvements Relevance Improving Effectiveness of Existing Product & Service offerings Enhancing Existing Product & Service Offerings Evolving product and service offering to meet future market needs Direct Marketing - Our Priorities Going Forward

  27. Questions?

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