I love endings! That usually means a completion of a task or a goal, and the opportunity to move on to new things. Year endings are the best. Close out the old and start with a clean slate. I think this year will not end so well. Instead of starting fresh we will be dragging an incredible amount of baggage along with us into 2012. As we have moved into our new digital age in the first decade of the 21st century, our legacy tools and traditions, and so much of what makes up our business way of life are struggling to advance with incredible pressure being on them to adapt, or die.
One of our oldest tools in the U.S. has been the Postal Service initiated in large part by Benjamin Franklin. It was instrumental to our overall success for over 200 hundred years. Today, it is seen by many as a ‘relic’ of the past as new digital tools have eaten into its core ability to facilitate communication. Hand written letters are becoming things of the past. Our current generation would not understand the context of the old saw – “keep those cards and letters coming!” Now we have to warn people about communicating (i.e. – texting) while driving.
I could go on for days about this transition, but I won’t. I have written extensively about the battle for the future of our USPS and what it means to commerce and personal communication. The leaders of the USPS have offered solutions – i.e cutbacks, and I have applauded their honesty and candor about their situation and things that must be done to keep the USPS on a sound financial footing given our change in mailing patterns.
The latest salvo against their plan has come from their masters, the Postal Commission – “Postal Service’s Closure Review Process Was Flawed, Panel Says” They believe that the original plan was ‘flawed’ and did not take into consideration a number of sensitive issues other than just cost. That is an honest statement, but the overall consideration by the Commission is politics. The only answer for the USPS is a full and open consideration of what we expect from the service in light of today’s evolving digital world, and what are we will to pay for as citizens to preserve the service as a whole, and how will the prime users contribute to save their unique positions. This includes the full commercial mailers, and rural users who are the prime drivers of cost.
I await 2012 to see how this evolves. I expect no real answers until after the election of 2012 which will go a long way to determining how we as a large community will choose to deploy and pay for the resources that we use.
Postponing the inevitable…good news, and bad advertising, will still be delivered to your mail boxes, on time and without delay. A temporary agreement driven by a coalition of Democrat Senators has gotten the USPS to postpone the planned closing of a number of postal service centers, post offices, and the reduction in service standards the USPS proposed. Whew, just another great challenge for our elected leaders in Washington to boot down the road until ‘later.’
While that was going on this week I spent my time interviewing local businesses and those I know who are professionals in the mail business on how they were taking the situation that will have big impact on them, and their customers. The delay is good news, since we need more time to process and plan. Almost to a person everyone that I have spoken with understands the situation – volumes have dropped, costs have continued to rise, and the direct mail support industry has continued to shrink. Like my old compatriots in the newspaper business they understand the direction things are headed. No heads buried in the sand here!
What they don’t understand is why it has taken so long to recognized what they see everyday. The world has changed, and legacy forms of communication, mail, just as printed daily newspapers, aren’t the dominant forms of communications they used to be. We all must plan for the next phase of evolution in how we send and received all of our information, including payments for bills, as well as Christmas cards. This hurts because it forces us to once again, realize how much our entires lives have been transformed, and will continue to change.
I hope that in this ‘truce period’ we can lower the volume and come up with some plans on what we want our postal services to be. I didn’t use USPS, because we might find other ways to communicate or ship messages with something other than a total government monopoly. But we have to define what we want, what we are willing to pay for, and then gain agreement before moving forward. If not, the plan will fail. Here’s to coming up with some great plans…and to a Happy Holiday for all.
Another one bites the dust! Lee Enterprises, publisher of 48 daily newspapers, filed for Chapter 11 bankruptcy protection to refinance almost $1 billion in debt. This will not be the last bankruptcy filing for the newspaper field, perhaps the last for 2011, and that’s a good thing.
The plan is for the company to repay its creditors in full, but will require the extension of key payments of maturing debt due in April into 2015-2017, though at higher interest rates.
The newspaper business is not the high margin field it used to be. Coupled with the debt incurred after a major raft of acquisitions and consolidations over the past several years, the field is awash in red ink. In the case of Lee it was their acquisition of the Pulitzer chain back in 2005.
Recently, Warren Buffett bought The Omaha World Herald, it’s other newspapers in what is likely a ‘sugar daddy’ deal. By that I mean it was for personal reasons, not just as an investment. Nice to have a lot of disposable billions like Warren has, and that is what the newspaper business needs. Deep pockets, and the desire to make a difference with a big voice in the local community. This was really how the newspaper business got started, and going back to our roots could be what we really need at this time in our history.
A funny thing happened on my way to researching the options for the USPS. I got way laid! I must admit that this happens to me a lot, especially when I have ‘chores’ to do. This time, no chores, but I found that when I started doing research with all of my friends in the direct marketing field – they wouldn’t stop talking. I quick discussion turned into a 2-hour meeting. That was repeated multiple times, but it was well worth my time, and therapeutic for them. I left them all with the feeling that they had gotten something off of their collective chests.
What did I learn…a lot! First thing, all are passionate about what they do! They feel that they are contributing to the big marketing effort to sell goods and services, and that direct marketing is still relevant and vibrant. The second thing that I learned is that, they are nearly all wondering, what the hell happened, and this can’t be happening to me.
Where do they go from here, and where the heck do I go from here? More field work I guess, looking for real options that reflect the public mood, and the mood of the users of direct mail and direct marketing. Meanwhile, the battle continues to be waged in the halls of Congress, where hearings will go on,and talk will flow. If we could harness the energy from all of the Congressman’s lips, even on this little subject, the energy crisis would be over…tomorrow.
Seriously, this issue on the future of the USPS is real, and everyone is concerned. The answers aren’t simple, and few agree, today, on what we should do, and what kinds of USPS we should have in the 21st Century. I will continue my journey throughout December to try to bring some sense to the issues, and to try to shed some light on possible solutions, and probable outcomes. Now back to the battlefield to interview more wounded warriors. Roger and Out!
It seems that the battle for the direction and future of the USPS has now been fully engaged. We’ve had words, and now we have action – or at least the threat of action. We’ve gone from hand wringing, to bluster, and now we have the scheduling of some real action to address the persistent financial problems facing the USPS. Today we have a real General, albeit the Postmaster General, promising positive steps to reducing costs by changing service levels to reduce costs.
As a direct marketing veteran, 30 years in service, General sir! I am pleased that Patrick Donahoe has taken some bold steps indicating that he is ready to make the cuts and adjustments that will help bring his USPS back into a balanced financial position.
Over the coming days, and probably weeks, I will write extensively about all of the issues, hopefully from the perspective of all sides, and try to posit some solutions that I think all can live with, if not love. Our times have changed how we consume our information, more digitally now, and less via print and mail. This trend is likely to continue and that means adopting solutions that work best for all of us.
Tomorrow – the USPS plans and requests, their solution for the short-term fix to their budget woes.