Canadian Magazine Industry News
21 November 2012,     TORONTO
Canada Post striving to maintain 'low cost system' for physical mail
TORONTO—Canada Post is well aware of the fact it needs to change the way it does business to keep up to an evolving market, said Jacques Côté, group president of physical mail at Canada Post, who delivered a well-attended keynote during the closing day of Print World 2012.


But what will it do to stay relevant?

"The challenges of the industry are the challenges of Canada Post," said Côté. "The digital reality is here to stay. We have a better chance by working together."

Some of the initiatives coming in 2013 from Canada Post include an "expert" Partner Program — a new tier on an existing service that promises "higher-value sales leads, rebates and discounts on some direct mail products, and more," he said.

There will "also be a greater focus on ad agencies" next year, said the president. The initiative relates to promoting the effectiveness of direct mail components in multi-channel campaigns. "Canada Post has not been talking to agencies about the the success of direct mail," said Côté.

The postal giant recently introduced changes to help sell direct mail with the introduction of new machinable mail specs, while opening up space on envelopes for more creative.

Côté said another growth opportunity for physical mail is catalogues. "Canada is lagging behind the U.S. in catalogue availability," he said.

He was questioned about why Canada Post is heavily promoting its epost electronic service, while touting the advantages of printed mail. But Côté defended the move by noting, "epost is a bit of a defensive move. It's trying to capture some of the mail erosion, but increase the budget to promote mail."

The erosion rate is about 3.5% a year, he said, adding that even at that pace, Canada Post will still likely exceed $3 billion in mail revenue in 2020.

"We can't rely on cost-cutting," he said, pointing to the corporation's recent $2 billion investment in equipment to improve productivity. The average cost per unit of mail is 58 cents (including magazines, parcels, etc.) — but the mail volume decrease "poses a risk to the low-cost system," said Côté.

Visitors of Print World had opportunities to learn about the new rules from Canada Post representatives, as well as authorities from the National Association of Major Mail Users (NAMMU), which held its National Postal Forum at the show.
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