With a response rate of 4.9% for prospect lists and 9% for house lists, direct mail offers a highly effective way to reach consumers. However, a growing campaign can get costly since postage is a major expense.
The good news is that presorting direct mail allows you to improve cost efficiency significantly by putting in a little extra work. If you’re sending a lot of direct mail, these savings can add up quickly.
Here’s what you need to know about direct mail presort, the pros and cons, and how you can make it work for you.
What Is Presorting and How Does It Work?
USPS Presort is a discount that the U.S. Postal Service offers to customers when they sort their mail before sending it. Businesses can lower their postage cost by doing most of the work normally performed by the postal service to prepare a piece for mailing. The discount depends on the service level, as well as the weight and shape of the pieces.
The presorting process groups mail by ZIP Code and sub-ZIP Code. Using specialized software, you can also verify mail addresses, sort the mail into specific groups and add barcodes to each piece according to USPS’ rules. You then deliver the mail to the post office using trays supplied by USPS.
The Advantages of Presorting Direct Mail
Presorting your direct mail brings many benefits to your marketing efforts, including:
- Cost savings: The normal rate for letters is $0.55 and the presort rate is $0.46 for a 1-ounce piece, saving you $0.09 apiece. For a 3-ounce piece, you’d pay $0.46 instead of $0.85, lowering the cost by $0.41 each. For postcards, you pay $0.285 instead of $0.35. Multiply those savings by thousands of pieces, and you can see how quickly they’ll impact your business.
- Faster processing and delivery: Since USPS only has to transport and deliver the mail, you can reduce the processing time at the post office. You’ll also have more control over the timeline, especially when you work with a trusted direct mail service that offers a fast turnaround time.
- Higher response rate: Time-sensitive materials — such as statements from financial institutions, invoices from collection agencies, correspondence from government institutions, bills from utility companies, limited-time marketing promotions and more — can get to recipients promptly, making them more likely to prompt the desired responses.
- Save time and reduce overhead costs: Instead of making numerous trips to the post office or navigating a maze of postal regulations, you can work with a direct-mail service that takes care of the entire presorting process so you can save time, money and hassle all at once.
The Disadvantages of Presorting Direct Mail
While there are many benefits to USPS presorting, you may encounter some challenges:
- Increased resource requirements: You’ll need to allocate staff to prepare the mail and deliver the bins to the post office. This will also require a designated area in the office for mail preparation and a laser printer to create the presort labels.
- USPS presort cost: You’ll have to apply for a presort permit, which costs $240 a year for outbound mail.
- Software purchase and maintenance: A Coding Accuracy Support System (CASS)-certified software, which improves the accuracy of your mailing by verifying addresses in your list against a database of deliverable addresses in the U.S., can cost $1,000 or more per month.
Is Presorting Direct Mail a Good Option for Your Business?
If you send over 2,700 letters or 3,700 postcards a year, you’d achieve enough savings to cover the cost of the presort permit. Businesses that have extensive mailing lists for catalogs and advertising can realize the most savings. However, those that only send out mailers in short spurts may not yield enough savings to offset the costs of setting up the in-house presorting process, applying for the permit and purchasing the software.
To take advantage of the many benefits of USPS presort without the hassle, work with a direct-mail service provider that can help you improve the cost efficiency of your direct mail campaigns. For example, our commingling service helps our customers realize average savings of 10-20% annually while making sure that their mail gets to the right place on time, every time.
Get in touch to see how we can help you make direct mail work harder for you.
