Recent advances in technology are helping merchants become better marketers by utilizing the Postal Service to not only reduce their shipping costs but also deliver an improved customer experience.

Today's merchants and retailers face a two-pronged dilemma. On the one hand, consumer choice and customer expectations are at an all-time high, fueled by fierce competition among retailers, easy availability of products through multiple channels (including mobile), and brand proliferation. At the same time, consumer sentiment has permanently shifted as a result of the recession; price matters as never before, and that extends to the cost of shipping for e-commerce and catalog merchants. Consumers are no longer willing to pay a premium for expedited shipping — which makes USPS-based technologies more attractive.

In recent years, the USPS and its business partners have made significant investments in technologies supporting full visibility of small parcel deliveries and returns in a postal environment. The goal of this partnership is two-fold: to provide solutions that not only reduce costs (for both shippers and consumers), but also deliver a superior customer experience that improves customer loyalty.

This is accomplished by using rich data and ensuring transparency throughout the delivery/returns process to accurately manage customer expectations, reduce labor and customer service costs, improve inventory management processes, and streamline reporting across the business. This article examines how USPS technologies can lower costs and improve service, and also takes a look at several specific examples of how USPS-based solutions can make a real difference.

Postal technology lowers costs for consumers
In this new era of cost sensitivity, receiving a package in 3-5 days, at a fraction of the cost of expedited shipping, is good enough for most consumers — giving a distinct price advantage to the USPS and its partners. 

Given the high fixed costs of expedited shippers due to their enormous investments in facilities and fleet requirements (both aircraft and trucks), these carriers must charge a premium for residential deliveries, as evidenced by ever-increasing residential and delivery area surcharge fees, or any one or more of the dozens of •value-added service' fees that may be assessed. On the other hand, since the USPS already supports every U.S. residential address as part of its standard daily service, these costs are integrated into its operating structure. Additionally, for merchants developing initiatives to reduce their impact on the environment, it is worth noting that the USPS can support a year's worth of service to a single address for less than one gallon of fuel. That's a huge benefit for merchants — and one they can pass along to consumers with lower shipping costs and a cleaner environment.

Improving the customer experience through better communications
Of course, lower costs are only part of the equation. Advances in technology from the USPS and its partner community can also help merchants improve customer service while reducing their support costs. Postal business partners can provide merchants with end-to-end visibility in a delivery environment that allows them to:
• Provide regular updates about orders to customers through low-cost e-mail communications
• Deliver customized tools that allow the customer to track each order, greatly reducing the number of "where's my order?" calls into the call center.

By empowering consumers with better communications and improved access to information, merchants can actually deliver a level of service that builds brand loyalty — and in turn, increases customer revenue.

As for those social networking sites that can turn into a whirlwind of brand-damaging comments due to a single bad shopping experience? By using the right shipping technologies to exceed a customer's expectations, these networks have the opportunity to become the lowest cost, yet most effective, word-of-mouth marketing vehicle available to a merchant. 

Postal lowers the cost of undeliverable shipments

We've taken a quick look at how USPS-based solutions can lower costs and improve service in general — now, let's examine two specific examples by focusing on how such systems can reduce the number of undeliverable shipments and improve the returns process.

Undeliverable parcels, which affect approximately four percent of shipments annually, are an increasingly expensive headache for merchants. Considering that an expedited carrier may charge up to $10 in •value-added service' fees in order to "correct" a single package address, a merchant with a million shipments per year may pay $100,000 - $400,000 in additional shipping costs annually, all of which may be levied at the "driver's discretion." 

However, postal business partners can help merchants reduce costs by assisting them with address hygiene services designed to correct current and future issues associated with undeliverable parcels and mail. By utilizing the Coding Accuracy Support System (CASS Certified) services, merchants have the opportunity to identify address problems before they become an issue, resulting in lower delivery costs and fewer re-shipments. And because the corrected address information can be provided to them electronically, merchants can update their file with that information to avoid another reshipment to the address. All of this can be done electronically, at costs which are a fraction of those offered by expedited carriers — lowering costs, reducing or eliminating needless re-shipments, and creating a more positive customer shopping experience. 

Many Happy Returns
The USPS and its partners can also help merchants deal with the inevitability of customer returns — enabling merchants to keep it simple, convenient and cost-effective with a USPS pre-paid returns service. The measurable benefits can range from minimal to game-changing.

When combined with a postal-based return service, the latest returns technology can provide you and your customers with the highest level of visibility throughout the returns process for optimal efficiency. These services can:
• Accelerate the returns process by seven to nine days
• Provide full visibility to returns within 24 to 48 hours, so the merchant doesn't overstock on merchandise that is coming back via returns
• Deliver self-service tools that allow consumers to check on returns at times that are convenient to them, while minimizing calls to the contact center
• Take advantage of vendor-provided tools that support RMA processes, online label generation, etc., while capturing product-specific information associated with the return 

These are just a few of the benefits available through a technology-based postal returns solution. As a result of the benefits described above, customer service costs drop, inventory expense decreases, labor and real estate utilization is streamlined, internal reporting processes improve, and costly accessorial fees such as call-tags are eliminated. The net result: you can actually deliver a better customer experience in what can often be a negative situation. 

Looking ahead
USPS-based shipping solutions bring together the best of both worlds for merchants: reducing costs, while enhancing the customer experience. In today's economic climate, it's no wonder that, while volumes for expedited services have continued to steadily decline, volumes for cost-effective service alternatives through the Postal Service are on the rise. 

Kevin Brown is the Director of Marketing for Newgistics, where he maintains responsibility for the company’s branding and corporate communication initiatives, in addition to supporting strategic efforts in the development of new products and services for the company. Prior to joining Newgistics in 2003, Brown held a variety of Sales and Marketing-related positions in the technology industry with companies such as Dell Corporation and International Business Machines (IBM).