As the United States Postal Service enters the sixth month since Megan Brennan took reigns as the Postmaster General and CEO, there have been some notable changes throughout USPS.
Truth be told, USPS services began growing before Brennan succeeded Patrick Donahoe, and the two partnership programs with Amazon, the “last mile” delivery program and the grocery-delivery-via-taxi pilot program in San Francisco are a testament to that.
The focus, however, seems to be on expanding same-day delivery, which is not surprising, given the popular demand. After all, the Wall Street Journal recently quoted Brennan saying:
Clearly, the consumer demand is such that we all want the package today. So we’re being responsive to that.
The USPS Household Diary Study
Of course, to understand how the USPS looks to the future, we need to figure out what is going on today. The USPS Household Diary Study is a report issued every year since 1987 and it is the best description of how Americans use the Postal Service.
Here are a few takeaways from the report:
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U.S. customers have clearly moved away from paying their bills via mail to paying online. Of 11 billion different pieces of mail send last year, only a small percentage of it included bill payment.
Last year, for instance, American households paid in average 63% of their bills online, only 33% through mail and 4% in person. Back in 2004, the situation was completely different, with the majority of bills being paid by mail (69%) and just 25% electronically, while 6% were paid in person.
More Volume from High-Income Households
According to the report, there is a direct correlation between a household’s income and how much they send/receive mail. For example, households with $65,000+ income receive 12.3 pieces of Standard Mail a week, while those households with $7,000 or less receive approximately 3 pieces of mail every week.
The same goes for package deliveries. Households with the lowest income receive in average half the amount that those with higher income do.
E-Commerce Delivery Driving Package Volume
Between 2013 and 2014, package volume went up by 200 million units, about 2%, which is a bit surprising, especially considering the growth of e-commerce and package deliveries in general.
There is, however, a big “but” here, as the report also reveals that these figures include some declining products such as DVD and CD rentals (they are being more and more replaced by streaming services). Without these products, the figure goes up to 11%, which seems more appropriate.
What Does the Report Tell Us?
The report reveals to us the current strength, weaknesses as well as where the Postal Service could be expanding in terms of services in the years to come. What we can get out of all this is that the USPS’s network will be the key in meeting same-day delivery needs of the American citizens, especially given their preference to e-commerce solutions these days.