Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Sun Aug 18 2013 19:41:46

Will USPS Future Plans for Priority Mail Result in Higher Rates?

By: Ina Steiner

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Expect to see television ads promoting the USPS Priority Mail service beginning this week. I was privy to a conference call with journalists hosted by U.S. Postmaster General Patrick R. Donahoe and Chief Marketing and Sales Officer Nagisa Manabe who were trying to spread the word to both consumers and small businesses about the attractions of using Priority Mail to ship packages.

The USPS recently rolled out changes to Priority Mail, including rebranded Express Mail to "Priority Mail Express."

The USPS also added an estimated delivery time designation on shipping labels and in the USPS Tracking information - clearly they believe eBay's philosophy in providing estimated delivery dates to customers - see Monday's Newsflash article for more information.

Donahoe and Manabe called Priority Mail's recent "brand refresh" a bright spot for the organization. As Kenneth Corbin noted in Newsflash recently, USPS shipping and package revenue spiked 8.8 percent for the most recent quarter, and Donahoe and Manabe said ecommerce was a major driver in that growth.

While there were no real surprises in the presentation, in a post-call followup, I did learn something extremely interesting. A spokesperson said future plans include moving to a guaranteed service for day-specific delivery.

Right now, only Priority Mail Express (the former Express Mail service) is guaranteed delivery - the other dates (1 Day, 2 Day and 3 Day), which the duo referred to as day-specific delivery, are estimates based on the package's departure and ship-to location - in other words, customers cannot request 1 Day, 2 Day or 3 Day Priority Mail.

The USPS has flexibility to make changes to services and rates to what are called "competitive" offerings, under which Priority Mail falls. Eyeing carriers such as UPS and FedEx, apparently the USPS believes it can further improve Priority Mail (and improve its bottom line) by guaranteeing delivery dates. But would a hypothetical increase in package volume as a result of such a change be enough to satisfy the desire to boost postal revenue?

I'm curious about how online sellers who rely on Priority Mail feel about such a change. I would think if the USPS could meet those delivery times, guaranteed delivery would be a plus - but would it come with a rate increase? Let us know what you think!

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This user has validated their user name. by: Rexford

Mon Aug 19 14:17:03 2013

Agendaswallowsall, I keep hoping to receive a survey that reads "Would you like the CEO of eBay to leave in 1 day or 7 days"......I'd of course check the 1 day box.

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by: Ed This user has validated their user name.

Mon Aug 19 14:46:58 2013

I would think that USPS should offer Free Shipping.

ebay spends millions of our hard earned dollars promoting Free Shipping. If JD spent the next few years spending his think time on correcting USPS increase problems he won't have so much time making changes that cost us small seller so much of our profits.

If he can't make USPS offer Free Shipping he could at least stop the problem with the DSR shipping cost that is going to be punish every seller that can't compete with his Free Shipping policy due to where they live.

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This user has validated their user name. by: Basset

Mon Aug 19 18:37:37 2013

Ed - That has to be the best post I've read in a long time!!!

Maybe ''Free'' Shipping IS the solution to USPS problems. Sellers have been told so many times that it is the solution to all that ails our business - perhaps USPS SHOULD try it on for size!

Ed, must have had a thinking day this weekend.

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by: mindelec This user has validated their user name.

Mon Aug 19 20:48:36 2013

they will either raise prices or get rid of regular priority, cause if you guarantee regular priority, who is going to pay more for express?

they already shot themselves in the foot with raising international rates, now they will do it again with domestic ones

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by: val2525 This user has validated their user name.

Tue Aug 20 00:07:07 2013

I don't know about rates, but I do know it's already resulting in dings to my DSR for Ship Time.  A package was labeled ''2Day'' by USPS, delivered in 3 days however, buyer left a 4.  I may have to go to Free Shipping for the holiday shipping season just to avoid DSR dings because the USPS overpromised and underdelivered.  I'm starting to think the USPS Donohoe is related to eBay's Donohoe, since neither of them seem to think things out fully in advance of implementing them.  

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by: auctionguy This user has validated their user name.

Tue Aug 20 09:24:12 2013

While I like shooting fiery arrows at ebay for their anti-seller policies and ever-increasing seller fees, I am overall very pleased with the delivery from USPS. Like anyone else, I don't like the fee increases, but they are still the cheapest provider for shipping most packages. It's not like they are gouging us and padding their retirement accounts with high fees. Oh, wait, yes they are. But they have been forced to by Bush.

I rarely go to UPS or Fedex any more. Their fees are just too high for most items sold on ebay. Though they usually have better rates for items over 20 pounds, those items aren't worth selling on ebay due to the high shipping costs and high ebay fees. I won't sell any items over $100 because of the new, simplified, ''lower'' seller fees. There is little profit in those items anyway. With the occasional refund or damage claim, it just isn't worth it. I sell those items through other venues that are more seller-friendly.

I ship almost everything via USPS, usually Priority Mail. With the discount we get for Priority, but not for Parcel Select, Priority is often cheaper. If I offer calculated shipping, the buyer usually chooses Parcel Select, as it is cheapest, but Priority Mail is cheaper due to the discount and/or flat rate boxes, and the box is free, too. The buyer expects the item in 3 to 10 days, and usually gets it in 3 to 4, so they are usually happy. I have also had far fewer delivery and damage problems with Priority Mail than I have had with Parcel Post, when I used to ship more items via Parcel Post.

I have had a small percentage of cases (around 1% to 2%) where the package is delivered late or never has delivery confirmation. Luckily, most of these are honest buyers that don't claim they didn't receive their item just because the package wasn't scanned at delivery.  

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