000991
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BEFORETHE
POSTAL RATE COMMISSION
WASHINGTON, D.C. 20268-0001
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MAILING ONLINE SERVICE
I
I
_
Docket No. MC98-1
DIRECT TESTIMONY
OF
LEE GARVEY
ON BEHALF OF
UNITED STATES POSTAL SERVICE
I
000992
.-
1
TABLE OF CONTENTS
2
AUTOBIOGRAPHICAL
3
I. PURPOSE
OF TESTIMONY
4
II. PRODUCT
DESCRIPTION..
SKETCH . .. . .. . .. . . .. .. . .. . .. . .. .. . .. . .. . . .. . .. . .. . .. . .. . .. .. . .. . .. . .. . .. . .. .. . .. iv
Ill. IMPLEMENTATION
IV. POTENTIAL
.4
Test.. ........................................................................
.5
.6
Test.. ...................................................................................
Service.. .........................................................................
C. Experimental
9
.I
............................................................................
........................................................................................
A. Basic Operations
B. Expanded
. . .. . .. .. . .. . . .. .. . .. . .. . .. . .. .. . .. . . .. . .. . .. . .. . .. . .. . .. . .. .. . . .. .. . .. . .. .. . . 1
CUSTOMERS
.7
. . .. . .. .. . . .. . .. .. . .. . .. . .. . .. .. . . .. . .. . .. . . .. .. . .. . .. . .. . .. . .. . .. . .. .. . .. .. . 8
IO
V. USER ACCESS TO MAILING ONLINE SERVICE . . .. . . .. . .. . .. . .. .. . .. . .. . .. . .. . .. .. . .. . .. .9
11
VI. GOALS .........................................................................................................
.I1
12
A. Program Goals.. .................................................................................
.ll
13
B. Operational
.I2
Goal.. ..............................................................................
14
VII. EFFECT ON THE ESTABLISHED
15
VIII. DATA COLLECTION
16
17
IX. CONCLUSION
PRINTING AND MAIL MARKETS .. . .. . ...I2
. .. . .. . .. .. . .. . .. .. . . .. . .. .. . .. . .. . .. . .. . .. . .. . . .. . .. . .. . .. .. . .. . .. . .. . .. . .. . .. .. . . 14
.. . .. . . .. . . .. .. . .. .. . .. . .. . .. .. . . .. .. . .. . .. . .. .. . .. . .. . . .. . .. . .. . . .. .. . .. . .. . .. . .. .. . .. . .. . .. . . 15
MC98-1, USPS-Tl,
page
ii
1
LIST OF EXHIBITS
2
EXHIBIT USPS IA: Mailing Online Process Diagram
3
EXHIBIT USPS 1 B: Timeline for Mailing Online Tests and Roll-Out
4
5
LIST OF APPENDICES
6
APPENDIX
A: Experimental
7
APPENDIX
B: Market Test Service Data Collection
Service Data Collection
Plan
Plan
MC98-I,
USPS-Tl,
page
iii
000994
_-
1
2
3
Direct Testimony
id
Lee Garvey
4
AUTOBIOGRAPHICAL
5
My name is Lee Garvey.
6
Manager in the Marketing department
7
responsible
8
provide small businesses
9
Mail.
10
I serve as a New Business Initiatives Group Program
of the United States Postal Service.
for managing the development
A 25year
SKETCH
with convenient
of Mailing Online, a strategy designed to
intemet access to First-Class
career as a letter carrier in the Arlington, Virginia post office.
12
as Station Manager, Account Representative,
13
National Account Manager.
14
wide variety of postal customers,
15
facilitating solutions for a multitude of mailers’ needs.
17
and Standard
employee of the United States Postal Service, I began my postal
11
16
I am
I have a bachelors
College in Washington,
International
I have since held positions
Account
Representative
In these latter positions I have worked extensively
and have been instrumental
degree in business administration
in analyzing
and
with a
and
from Columbia Union
DC.
MC98-1, USPS-Tl,
page
iV
000995
e-1
I.
2
is to describe the current and planned operation of
3
Mailing Online.
I describe the program, its operation,
4
implementation
of the service.
5
established
6
the business imperatives
7
II.
9
and the planned stages for
I also address the potential effects of the service on the
printing and mail markets, the objectives of the Mailing Online service, and
PRODUCT
to which it responds.
DESCRIPTION
Mailing Online will allow postal customers with access to a personal computer
(PC)’ and an internet connection
to transmit documents
created on their computer and
10
have them printed and mailed, paying online in a single transaction.
11
World Wide Web-based
12
commercial
13
system.
14
individuals and small- and home-based
15
access to sophisticated
16
17
.-~
OF TESTIMONY
The purpose of my testimony
8
F,
PURPOSE
software application’
Mailing Online is a
designed for user-friendly
access to
digital printing and mailing services via a Postal Service network control
This service uses advances in technology
The experimental
businesses,
digital printing technology
to benefit our customers,
who would not otherwise
and to bulk automation
especially
have
mail rates.
Mailing Online service is planned to operate as follows.
Customers will submit a document
and a recipient address and data list electronically
to
’ Mailing Online is designed to accommodate a large percentage of the personal
computers currently in use.
*The Postal Service will provide full service access via the World Wide Web,
using browser functions in lieu of user-installed software. Lower costs, ease of use,
and a desire for wider initial availability have focused development efforts solely on
Web-based software. Greater functionality and increased user utility may be sought
(footnote continued.. .)
MC98-1, USPS-Tl,
page
1
1
the Postal Service via the intemet.
2
fields, in addition to the recipients
3
inserted.
4
specifications.
5
information,
6
center, which performs multiple functions, including mail merge and variable data
7
merge if applicable,
8
center will create print files and distribute them directly to commercial
9
according to destination
.I0
Customers
Word processing
documents
address, where data specific to the recipient can be
will also have numerous
choices regarding
Then, the digital files containing the document,
and printing options will be processed
address hygiene, presorting
ZIP Codes.
printing and finishing
address files, customer
through a computer
network control
and limited archiving.
The commercial
The control
print sites
print sites will be geographically
situated according to demand and will be equipped with high-quality
digital printers and
11
finishing equipment.
12
an expected 25 sites in operation
13
specified,
14
mailings, and transport them to a local office for acceptance,
15
by the Postal Service.
16
as Standard
17
charged the applicable postage rate, plus a fee covering the production
18
costs.
The plan is to add print sites incrementally
during 2001.
as volume grows, with
The printers will print the documents
place them in permit indicia envelopes,
prepare system-sorted
processing,
The mail will be entered as First-Class Automation
(Regular or Nonprofit) Automation
(footnote continued.. .)
through the future development
Online customers.
---.
may contain merge
of user-based
as
batch
and delivery
Basic Mail or
Basic DBMC Mail. Customers
will be
and system
software for certain types of Mailing
MC98-1, USPS-Tl,
page 2
000997
-~
1
Mailing Online currently accepts digital document files from two standard word
2
processing
3
lists can be submitted
4
current print-on-demand
5
standard
as well as three popular desktop publishing
in four standard
technology,
PC formats.
requirements
9
individuals,
offices, and small enterprises
broad appearance
publishing
13
graphics, logos, and signatures;
.
.
19
who are expected to use Mailing
include:
software to createand
digital printers to produce-complex
a wide variety of finishing capabilities,
including a variety of binding and stapling
the ability to control when the mail piece enters the mailstream
by scheduling
a
specific mailing date online;
17
18
of the
options;
15
16
imperatives
and format flexibility, driven by the ability of desktop
12
14
See LR-2., p. 2. The
and features reflect the stringent user-friendly
Online. These customer requirements
l
to digital printers.4
and user features for Mailing Online were developed
8
11
of
the Postal Service plans to utilize industry
through extensive focus group and end-user research.
small/home
Mailing
In order to take full advantage
7
10
packages.3
print formats such as PDF and PostScript for transmission
Initial service requirements
6
-~
packages
.
the customization
of output using recipient database
variables under the control
of the user, such as a person’s account balance on an invoice.
3 Applications currently supported-MS
WordTM, WordPerfectTM, PageMaker”,
Ventura”
and QuarkTM-were
chosen based upon market share at the time of
technical specification.
Future development will include additional applications
identified by user demand studies. In addition, a universal Portable Document Format
(PDF) input capability will be included to allow document creation using many
unsupported applications.
4 Proprietary print solutions specific to a single manufacturer have been avoided
intentionally to create the broadest possible opportunity for participation by any digital
print provider.
MC98-1, USPS-Tl,
page 3
000998
-4
1
2
Mailing Online combines the power of desktop publishing
3
software with the speed and convenience
4
of high-quality
5
delivery by the Postal Service.
6
collection,
7
Postal Service is responding
8
mail collection (39 U.S.C. 5 403(b)(l)).
9
highest consideration
of the internet; it combines
printing with the security, familiarity, and universality
mail preparation
of hard copy
electronic
mail
and assembly, and traditional hard copy mail delivery, the
to its mandate to provide an efficient nationwide
system of
It also responds to the mandate to “give the
to the requirement
for the most expeditious
transportation
11
methods of accomplishing
12
logistical flexibility, traditionally
13
electronically
14
furthers fulfillment of the Postal Service’s responsibility
15
to meet the needs of different categories
16
Ill.
18
the visual impact
By creating a service that integrates
IO
17
and word processing
collection,
and delivery of important letter mail” (39 USC § 101(e)), and to seek new
these tasks. Enhanced
service options and increased
open only to large mailers, will now be available
via the intemet and Mailing Online to even the smallest mailer.
This
to provide types of mail service
of mail and mail users (39 U.S.C. § 403(b)(2)).
IMPLEMENTATION
The Mailing Online implementation
operations
test, the expanded
test (“market test”), and the experimental
19
A. Basic Operations
20
The first phase, a basic operations
21
September,
22
Connecticut,
plan involves three stages:
the current basic
service.
Test
test, began on March 9, 1998, and will end in
1998. Tests are currently underway
as part of the operations
in Tampa, Florida, and Hartford,
test for the Postoffice Online-the
Postal
MC98-1, USPS-Tl,
page 4
000999
1
Service’s internet access channel for small and home offices.
2
of 200 selected participants
3
numbers of PC-produced
4
are using the Mailing Online prototype
documents
The basic operations
system to mail small
to any domestic destination.
test was designed to provide the Mailing Online developers
5
with technical information
6
service, so that a request for a viable experimental
7
properly.
8
findings of customer requirements
9
capabilities
and the experience
necessary
to define and refine the
service could be formulated
During the basic operations test, qualitative and quantitative
and refined into specific, technical product features and attributes.
basic operations
11
about technical capabilities
12
assumptions,
and to create a set of technical requirements
13
components.
Technical specifications,
14
requirements
are undergoing
15
participants
16
printing and production
17
developmental
test provides a means for the developers
pay First-Class
in the marketplace,
The
to evaluate assumptions
to begin to evaluate costing
for the operational
actual costs and specific operational
continual review.
Mail single-piece
For the current basic operations
test,
postage for the mail that is produced, with
charges covered by the Postal Service as part of the
costs.5
18
B. Expanded Test
19
The expanded test is scheduled to begin September
metropolitan
market research
are being tested against existing technological
10
20
For this test, a maximum
areas: New York, Boston and Philadelphia,
I,1998
in three
using one printer located in the
’ This temporary arrangement also has the benefit of being an incentive for
potential customers to participate in the test.
MC98-1, USPS-Tl,
page
5
00%000
1
northeastern
2
printer in early August.
A second printer in another area may be added after the test
3
begins.
test is expected to continue until the implementation
4
experimental
5
United States.
The expanded
of the
service.
The plan for this test is to allow a substantial
increase in the number of
6
participants
7
will conduct further tests of the technology
8
establish and maintain with contract printers for the nationwide
9
---c
The Postal Service expects to have a contract with the
from the current two hundred to several thousand.
The Postal Service is requesting
During this phase, we
and refine the relationships
that the Commission
we need to
experimental
recommend
service.
interim fees
10
and an interim classification
change for this phase as a market test of limited duration,
11
pending a recommendation
on the request for an experimental
12
changes are needed for a number of reasons.
13
production
14
purposes; a mechanism
15
rather than by the Postal Service.
16
service requirements
17
discounted
18
mailings.’
19
actual customer usage when payment for printing services has not been waived.
20
Without the interim fees, the Postal Service would be forced to scale back the
service.
With the expansion
and printing costs would exceed reasonable
These interim
--
of the service, the
amounts for developmental
is needed to have them covered by the mailers at this point,
accurately,
Second, in order to assess market demand and
customers
in this phase should be allowed access to
postage rates for both First-Class and Standard
Third, the development
Regular automation
of projectible demand data must be premised upon
MC98-1, USPS-Tl,
page
6
001001
1
expanded test considerably,
2
limit the accumulated
3
compromise
such as by limiting participation
loss. Such a scaled-back
or volume in some way to
test, however, would necessarily
one or more of these immediate objectives
4
C. Experimental
5
Following the market test, the Postal Service proposes that Mailing Online be
Service
6
offered as an experimental
service for an initial period of up to two years.
7
distinction between the market test and experimental
8
availability in the latter of service to customers
9
distinction between the experimental
10
prove to be as simple as the presence
11
uniform entry of mailpieces
12
criteria.
of a nationwide
at destination
versions of Mailing Online is the
nationwide.
and permanent
The primary
In turn, the primary
versions of Mailing Online could
network of print sites that permit
entry rates under the existing eligibility
-~
13
-.
For the experiment,
the Postal Service will expand the service by contracting
14
with a number of printers in different locations, as described
15
more efficient service.
16
include full color printing.
17
printing options expected to accompany
18
defined costs an approach
19
options to be added or dropped during the course of the experiment.
earlier, in order to provide
The number of printing options also increases,
perhaps to
The increase in the number of printers and the expansion
this phase make the application
in
of a markup to
superior to a complex fee schedule while permitting specific
In the experiment,
(footnote continued.. .)
’ Access to Standard Nonprofit rates will not be technically feasible at this stage,
since eligibility will have to be determined at the time of customer access. The software
necessary to enable this is not expected to be finalized until the experimental phase.
MC98-1, USPS-T11 page
7
001002
1
the range of mailing options will be expanded to include First-Class,
2
and Standard
Nonprofit (assuming
Regular,
qualification).
The Postal Service is asking the Commission
3
Standard
to expedite its recommendation
on
4
the experimental
5
Service’s efforts to have major software publishers
6
versions of their software expected in early calendar year 1999 and to conform to the
7
planned nationwide
Data Collection
integrate Mailing Online into new
extension of access to customers.
During the experiment,
8
9
service so that there will be sufficient certainty to support the Postal
the Postal Service will collect data as described
Plans in Appendices
A and B. A determination
in the
to seek classifications
IO
and fees for Mailing Online service would be made prior to the end of the two-year
11
period.
12
IV.
13
POTENTIAL
CUSTOMERS
We expect users would include a wide range of individuals,
small businesses,
14
home offices, and charitable organizations.
For example, to mailers of a limited number
15
of invoices and statements--such
16
effective way to produce invoices easily, get them in the hands of customers
17
and thus accelerate
18
use is also anticipated
19
high-quality
as local merchants-Mailing
cash flow. While most customers
Online offers a costquickly,
will be small organizations,
by individuals, as well as by larger companies
some
for low-volume,
mailings.
MC98-1, USPS-T1 , page
8
001003
1
P
direct mail advertising
2
and solicitation,
3
Virtually all direct mail materials are designed
4
understand
5
will not be well suited for large volume direct mail or catalogs, because the economics
6
of on-demand
7
make localized, short-run direct marketing feasible for smaller businesses
8
never have used direct mail before. Time-specific
9
production
IO
V.
which we estimate will produce about half the Mailing Online volume.
using desktop computer technology;
that about one-third are produced in short-run quantities.
digital printing are currently unacceptable
convenience
I
Mailing Online
for long runs. However,
it does
that may
mail entry, graphic flexibility, and
are likely to be most important for these potential customers.
USER ACCESS TO MAILING
ONLINE SERVICE
11
To use Mailing Online, a PC user will:
12
1. Produce and save a document
using one of several popular word processing,
13
office suite, or desktop publishing software programs.
14
2. Produce a database of recipients’ names and addresses,
15
several thousand,
16
into the document.
These addresses
17
existing commercial
databases
18
fly
The largest potential source of volume will be short-run,’
ranging from one to
as well as a list of any other variable data to be merged
and data could be downloaded
from
or created by the mailing originator.
3. Log on to the internet and utilize the PostOffice Online Universal Resource
19
Locator (URL) or hotlink embedded
20
application
in his or her computer desktop or browser
to access the Mailing Online World Wide Web pages.
‘We have defined short run as less than 5000 printed impressions.
MC98-1, USPS-Ti,
page g
001004
I
4. Using a secure and easy-to-use
file transfer procedure,
transmit the
2
document
3
“proof’ the document online and will be notified of addresses
4
matched with the Postal Service’s Address Management
5
and are therefore being purged from the list.
6
and list to the Postal Service server. The user will be asked to
printing and finishing specifications,
8
to the material being sent and the senders
and to choose a class of mail appropriate
service expectations.
6. Approve and pay for postage and the requested
10
11
System database
5. Call up the “electronic job ticket” from the Mailing Online menu to enter
7
9
that cannot be
printing and production
via credit card, prepaid account, or other approved
Upon receipt by the Postal Service, print-image
fees
payment method.
files of the documents
12
recipient address files will be created for subsequent
13
print facility (or facilities) nearest the document
14
standardized
15
compatible.
16
and batched before transmission
17
the maximum depth of sort with a prepared manifest and mailing statement,
18
transmission
19
inserted into envelopes,
20
specified mail processing
21
existing service commitments.
22
print resolution
and
batching and transmission
destination(s).
Address
and corrected so that mail produced will be completely
to the
elements will be
automation
Where possible, files with like printing and finishing options will be merged
to the printer.
Each batch address file is presorted to
along with the print files. The documents
addressed
will then be printed, finished,
with delivery point barcodes,
facility for makeup verification
Specifications,
for
and taken to a
and delivery according
to
such as materials grade, paper weight,
quality, and finishing options will be identified in printer contracts to
MC98-1, USPS-Tl,
page 10
001005
1
maintain system-wide
2
when a document
3
deposited
4
VI.
consistency.
Electronic confirmations
will be provided to the user
is received at the print site, when it is printed, and when it is
into the postal mail-processing
facility.
GOALS
5
A. Program Goals
6
The primary goal of Mailing Online is to improve customer service by providing a
7
convenient
electronic
means for entry of single piece and short run mailings that can
8
capitalize upon automation
9
Service to determine
compatibility.
The experimental
whether the current specifications
10
the desktop computer-based
11
cost of producing
12
efficient way to use the mail. The testimonies
13
Campanelli
(USPS-T-8)
14
convenient
and easy-to-use
15
businesses
not currently availing themselves
16
production
period will allow the Postal
for the service are optimal.
For
mailer, Mailing Online is expected to reduce the aggregate
and entering a small mailing and provide a lower cost and more
of witnesses
confirm this expectation.
and preparation
Wilcox (USPS-T-7)
and
Mailing Online will also provide
electronic access to postal services for those small
of this medium for lack of ready mail
capabilities.
17
B. Operational
Goal
18
The operational
goal for the experimental
Mailing Online service is to verify the
19
capability of working with industry providers to build and operate a sophisticated
20
nationwide
21
mail.
distributed
printing network as a user-friendly
This strategy of purchasing,
electronic
as opposed to developing
means of inducting
the capabilities
in-house,
F
MC98-1, USPS-Ti,
page 11
001006
1
makes sense because the core functions and competencies
2
include neither business software development
3
technological
4
Postal Service to keep up with on its own.
5
VII.
6
developments
nor printing and finishing.
in these industries occur rapidly-too
EFFECT ON THE ESTABLISHED
PRINTING
rapidly for the
Mailing Online will promote the growth of direct mail and newsletter
among small businesses
8
Consequently,
9
business to printers, list brokers, and content providers.
because of Mailing Online’s convenience
it will increase the satisfaction
Furthermore,
if the service is expanded
of postal customers
nationally,
11
printing services, and mail production
12
quantities, offering opportunities
13
The Postal Service is currently developing
14
that qualified print service providers have an opportunity
15
revenue from this service.
16
In addition,
AND MAIL MARKETS
7
IO
of the Postal Service
During the experiment
and assembly
publishing
and ease of use.
while providing new
it will create demand for
services, in potentially
large
for private sector firms to benefit from Mailing Online.
a procurement
we expect to demonstrate
to the utility and effectiveness
strategy which will ensure
to reap the benefits of new
Mailing Online’s overall
17
contribution
of small-volume
direct mail as a marketing
18
tool, the net result of which should be an increase in business for the entire direct mail
19
services industry, including increases in list rentals, and new graphic design and
20
printing opportunities.
21
software manufacturers
22
increased markets for their offerings.
In addition, auxiliary providers such as document
and list maintenance-related
design
services will benefit from
MC98-1, USPS-T1 , page 12
001007
P
1
It should be kept in mind that the target customer for Mailing Online is the
2
relatively small mailer and the current non-mailer.
3
existing volume in this segment is produced
4
piece’rates.’
5
automation
6
their volumes increase, perhaps through the use of presort services or bulk hybrid
7
providers.
8
9
It is believed that much of the
on desktop printers and entered at single-
These very small volume mailers will learn about the benefits of
preparation
and rates and may be inclined to seek greater discounts when
The bulk hybrid mail segment contains several established
reasonably
sized businesses.
I understand
that while these companies
10
long-run, graphically
11
volume mailers.
12
which instead seeks to leverage the convenience
13
efficiencies
14
players with
compete for
simple, repetitive mailings, they do not currently target small-
Nor do they offer widely-available
internet services like Mailing Online,
of a Web browser and the short run
of digital print devices.
Lettershops
may be impacted by Mailing Online.
some of today’s small volume lettershop
Driven by users’ desire for
15
convenience,
mailings may migrate from
16
current methods to the Mailing Online system.
17
technology,
18
slowly and into more purely electronic communications
19
e-mail.
20
technology
adopters, stem their migration to alternate methods, and enable creative
21
lettershops
to build more personalized
22
on the online approach.
However, as small mailers adopt PC
this shift into electronic methods is likely to occur anyway, albeit more
If successful,
methods such as end-to-end
Mailing Online could enhance the image of postal services among
and individually-responsive
systems capitalizing
MC98-1, USPS-Tl,
page
13
001008
1
Digital print providers are aggressively
2
opportunities
3
compete with Mailing Online.
4
printers encourage
5
promote the awareness
6
gain increased
7
VIII.
8
9
10
(see USPS-T-6).
pursuing on-demand
printing
Most digital printing services do not themselves
Rather, as discussed
by witness Hamm (USPS-T-6).
the Postal Service to pursue Mailing Online actively, because it will
and use of digital printing generally,
and printers are likely to
printing business.
DATA COLLECTION
In accordance
with the Commission’s
rules for market tests and for experimental
services, the Postal Service plans to report information to the Commission
Mailing Online transactions
11
The categories
about
on a periodic basis.
of data to be collected during the expanded test and
12
experimental
13
printing and class of mail. The Postal Service’s existing data systems, including RPW
14
and the CRA, will not be used to collect information
15
Accordingly,
16
collection efforts will be coordinated
17
bear responsibility
18
Collection
19
in more detail in Appendices
20
IX.
21
22
period include revenues, volumes, costs and volumes by category of
about Mailing Online service.
other means of data collection and analysis will be employed.
for preparing
Plans for experimental
through Postal Service Headquarters,
information
for filing with the Commission.
Such data
which will
The Data
and market test Mailing Online services are discussed
A and B, respectively.
CONCLUSION
The proposals for a market test of Mailing Online service, followed an
experimental
offering of the service. are critical to the Postal Service’s effort to provide
MC98-1, USPS-T1 , page 14
001009
1
individual and small mailers convenient
and cost effective access to letter mail services
2
and discounted
3
recommendations
4
Postal Service to gauge customer demand and refine features of the service while
5
collecting data necessary
postage rates. The Postal Service anticipates
requested
of the Postal Rate Commission
that the
in this case will permit the
to support a request for a permanent
Mailing Online service.
:-
MC98-I,
USPS-Tl,
page 15
EXHIBIT USPS IA
Mailing Online Process Diagram
Proof Document (PDF)
Address Standardi
Information and Notification
. Providesonlinejob status
. Storesdocumentandlist tiles
*Account Information
Mailing Online System Merge and Batch
. Assigns unique ID
. Batches mailpieces
. Batches mailpieces
- Presorls batches lo
. ‘Transfers data files
_I””
lo each mailpiece
with similar job eharactetisties
by delivery destination
finest level
to print site wvers
USPS Plant A
‘I
Approval
and
Payment
Authorization
‘I
USPS Plant B
b
USPS Plant c
MC98-1, USPS-Tl,
page
j
--;-
16
J.
-
~.
.-
-
-
-
EXHIBIT USPS IB
Timeline for Mailing Online
Mar 09
Operations
Test Begins
Tampa FL
Apr 39
operatkms
Test Expands
Hartford CT
Jan 10
Erperimentnt
Service Begins
Mar 01
Print Site #4
Jan 18
Print Site #3
May 24
Print Site #6
I
NW IS
Print Site #IO
Jul 12
Print Site if7
act 04
Print Site #9
I
Apr 24
Print Site #I3
Mar06
Print Site #I2
I
Aug 23
Print Site #8
I
Jan 17
Print Site #1I
2000 1
I
Apr I2
Print Site I+5
I
Dee 07
Print Site #2
Sep 14
Print Site #I
I
1998 1
1999 1
sep 01
Market Test
h”“Ch
North Eastern US
I
Jul31
PrintSite#l5
Nov 6
Print Site #I7
J”” I2
Print site #I4
Sep I8
PrintSite#l6
I
I
:
1
MC98-1, USPS-T1 , page
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.
~
-
-.
_.
_
._
17
_
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-
.
I.
-
1
2
3
4
001012
APPENDIX A
EXPERIMENTAL
RL‘c,E; ‘, L [)
DATA COLLECTION PLAN
c*ti~
JuL 15
., ‘W
Introduction
!;I,~,? ,-,
(J ,:, :‘,;
-I’:’
This ap,pendix describes the Postal Service’s data collection plan for the
5
proposed
6
purpose of the data collection plan is to provide a measure of the effectiveness
7
proposed
a
classification
9
designed to collect data required by the Commission’s
10
2 5~ I”,{ “53
experimental
experiment
Mailing Online service (MOL), as required by Rule 67~. The
of the
and the data necessary to prepare a request for a permanent
change, should the experiment
desired for postal management’s
prove successful.
The plan has been
Rules 64 and 64, and data
evaluation of the proposed changes.
11
The data collection plan for the experimental
12
three main areas: specific mailpiece characteristics,
13
preferences.
14
The collection of mailpiece characteristics
is intended to supplant the market research
15
presented
by tracking volume, revenue and mail
16
characteristics
17
Online volume should avoid some handling and/or transportation
10
be quantified.
19
these separately
20
21
-22
23
Mailing Online service will focus on
cost avoidance,
and customer
In each area the purpose of the data collection will be somewhat
in Library Reference
2/MC96-1
Since printing contractors
will be geographically
Finally, we will track what features customers
dispersed,
different.
Mailing
costs, which will also
prefer.
I discuss each of
below.
Most of the data will be collected via the Mailing Online server through which
customer documents
are transmitted.
Mailpiece characteristics
Mailing Online software, permitting its subsequent
are necessary
analysis.
to enable the data collection effort. Additional
will be tracked via the
No new statistical systems
market research,
.-
Appendix A.p.2
,' -
OQ1013
f
described
below, will be conducted
2
additional
information
3
the experiment
4
comply with this plan and with the requirements
5
should one be warranted.
in parallel to evaluate mailer interest and obtain
on the expected growth and development
gets underway,
of Mailing Online.
As
the Postal Service will ensure that all data collected
for a permanent
classification
change,
6
7
a
9
IO
-
i
11
12
13
14
15
16
17
f-3
19
Mail Characteristics
Mail characteristics
components
data serve to permit the forecasting
for Mailing Online services.
of specific demand
During the experiment,
the Postal Service
intends to compile the following demand data elements:
Total transactions
Total volume, broken down by simplex, duplex, and color
Total pages
Total revenue
Volume by subclass
Volume by shape
Volume by page size
Volume by envelope type
20
The Mailing Online server compiles these data elements for each transaction.
21
Postal Service plans to report this information to the Commission
22
quarter during the experimental
23
24
25
Mailpiece
characteristics
developments of requirements
The
at the end of each
period.
data will also serve the secondary
for selecting MOL printing contractors.
goal of assisting the
Appendix A, p. 3
; ,1
2
wl.014
Cost Avoidance
As additional
print sites are brought online, the Postal Service plans to collect
3
data that will permit estimation
of mail processing
and transportation
cost avoidance
4
resulting from the downstream
entry of Mailing Online volume due to the distribution
5
printing sites. Quantification
6
financial impact of Mailing Online.
7
during the experimental
0
than those proposed to be applied during the experiment
of
of these costs will allow for a more precise measure of the
The observed density of Mailing Online volume
period may indicate that different rate categories
or elements
are more appropriate.
9
10
11
Customer
Preferences
During the experiment,
the Postal Service will attempt to measure customer
12
opinion and preference
13
usefulness,
14
refine the product to conform more closely to customer expectations,
15
also fulfill a purpose more closely related to the instant filing. The market research
16
which supports the MOL volume projections
17
will be new to the Postal Service.
w
to determine
19
regarding a variety of service attributes such as convenience,
ease of use, and value. While the primary purpose of such research is to
estimates that 38 percent of MOL volume
(LR 2/MC98-I,
whether actual experience
this research will
p. 38) Further research will attempt
comports with this estimate.
In addition to validating the volume estimates, the Postal Service will attempt to
20
measure the need for additional
21
satisfied with MOL. and the effect that price and other service attributes have on
m-22
customer use of the service.
MOL features, the degree to which customers
are
001015
I* -
1
2
3
APPENDIX B
MARKET TEST DATA COLLECTION
As described
PLAN
in my testimony, the market test of Mailing Online will begin with a
4
single printing location.
Consequently,
it will not be possible to examine the cost
5
avoidance
issues that will be studied during the experimental
6
Otherwise,
the Postal Service proposes to study mailpiece characteristics
7
reactions using the methods described
offering of the service.
and customer
in Appendix A.
6
However, due to the smaller customer base that will be available during the
9
market test, the Postal Service plans to conduct more frequent reviews of available
10
data, and make more frequent contact with test customers.
11
Service proposes to report all operational
12
Accounting
Period.
As a result, the Postal
statistics and customer feedback
data each