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REVENUE GENERATIONOPPORTUNITY

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Pacific Area Focus Group

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Growing Direct Mail – The Challenge

Today’s Challenge

Keeping mail relevant in an online world

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• Mobile Technology – Scan codes on direct mail

• Data Breach – Communicating during crisis

• Political Mail – Campaign and fundraise using mail

• Affordable Care Act – Communicate requirements

• Every Door Direct Mail – Affordable, local targeting

Relevant USPS Solutions for Today’s Challenge

Growing Direct Mail – The Challenge

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Growing Direct Mail – The Challenge

Studies have shown that using direct mail and email in integrated campaigns creates synergies that boost response over using either medium alone. One study showed that using direct mail with email increased response by nearly 30% over direct mail alone.

Direct Mail is Relevant!

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Mobile Commerce

• Online sales grew over 26% over 2012

• Mobile commerce sales increased 68% in 2013 to nearly $42 billion

• 1/3 of all online sales are made on mobile devices

• By 2017, 77% of digital buyers in the US will purchase via smartphone or tablet

Source: IBM, Dec. 2013

Source: eMarketer, Sept. 2013

Source: IBM, Dec. 2013

Source: eMarketer, Apr. 2013

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Mobile Commerce

Mobile Technology Helping Drive Long-Term Value

• Smartphones and tablets interact with the printed page

• Catalog becomes “catalyst” for mobile commence

• Catalog integration with technology increases:• Relevance• Effectiveness• Convenience• Responsiveness• Engagement

NFCMobile Barcode Image Recognition Augmented Reality

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Addressing the Challenge

Political Mail Strategy – Mail drives online and offline donations and provides confidential message to voters

- Pacific Area $5.7M in new revenue from political mail YTD

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Addressing the Challenge

Affordable Care Act – Pacific Area – $9.3M in new revenue YTD

At a Glance: The Law and the Mail Opportunity

Individuals

with

Medicare

Individuals already

Insured

Individuals planning long-

term care

Uninsured or individuals that buy their own

insurance

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Addressing the Challenge

Every Door Direct Mail – Demographic data enhancement – more targetable and relevant

Pacific Area sold 331 sales; $14M in new revenue

from Every Door Direct Mail sales YTD

® Promoting First-Class Mail

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OPPORTUNITY IN

PACKAGES

BUILDING A WORLD CLASS

PACKAGE PLATFORM

Revenue Growth Opportunity

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NEED MARKET SHARE NOW GROW WITH HYPER-GROWTH OF MARKET

E-Commerce Continues to Grow Rapidly

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The Future of Packages

As ecommerce grows, expectations are being redefined

Free shipping is the new consumer expectation

Faster shipping at the lowest cost is the retailer

expectation (Transit times for ground have reduced to 2 to 3 days)

Customers desire later entry times, faster delivery, and delivery on the first attempt

Same-Day and Next-Day delivery are the new frontier

USPS Growth Strategy

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Our package growth efforts are focused on leveraging the strength of our network to market needs and wants

Meet rising customer expectations in package service and innovation in a rapidly evolving e-commerce world

Capitalize on the power of the mail, package delivery and returns combination

Build a World Class Package Platform

Major FY 2014 Initiative

ELT SPONSOR – MEGAN BRENNAN INITIATIVE LEAD – DAVE WILLIAMS

Build a World Class Package Platform by building a parcel processing and delivery network that supports package growth, weekend and same

day delivery, and enhances the customer experience.

OBJECTIVE

BUILDING A WORLD CLASS PACKAGE PLATFORM

Roadmap Roadmap Owner Roadmap Roadmap Owner

1 Integrated Package NetworkPlan

Dave Williams

8 Customer Development Plan Cliff Rucker

2 Product Development Plan Gary Reblin

3 Package Delivery Optimization Plan

Ed Phelan

4 Next Generation Equipment Mike Amato

5 International Package Processing Plan

Brent Raney / Giselle Valera

6 Improve Customer Pickupexperience

Kelly Sigmon

7 Simplified onboarding & Flexible Payment Solutions

Pritha Mehra

100% Package Visibility Robert Cintron9

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Grow the business

Build a network to meet delivery expectations while

handling growth

Innovate and improve delivery

Improve customer experience

Price Service Information

Payment Acceptance

Network Processing Network

Transportation

Intelligent Delivery Improved Delivery

Experience

Build a World Class Package Platform

Requirements to Compete

Build a World Class Package Platform by building a parcel processing and delivery network that supports package growth, weekend and same

day delivery, and enhances the customer experience.

BUILDING A WORLD CLASS PACKAGE PLATFORM

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WORLD-CLASS SCANNING PERFORMANCE

WORLD-CLASS SERVICE PERFORMANCE

FORWARD-LOOKING WORKFORCE STRUCTURE