Don't move your billing forward to take advantage of the postal rate increase.

Penny Black postage stampIf you’re mailing Standard Rate, you’ve got until Friday to present your material for entry at the USPS at the current rates. I hope you’ve been getting ready to mail at the old rates.

Is there anything you shouldn’t try to get in the mail at this point?

I can think of a couple things.  While it’s temping to get your billing out under the current postage rates (typically by accelerating a few bill cycles from next week to this week), my test results have shown that it’s not usually worth it.

For every cycle you push into this week (using an example of daily billing cycles and 6 day-a-week payment processing) you reduce the time for the customer’s last payment to get into the billing run.

Believe it or not, a lot of customers wait for the last minute to send in payments and they have a very good sense of the time it takes for a payment to work through the USPS.  Customers have a sixth sense about their payment cycles and changes to that timing tends to create problems.

When you move up a payment cycle by even one day, you start causing payments to cross in the mail.  Depending on the product you’re selling, the target audience and your billing strategy, you could end up with a significant number of customer service questions and phone calls.

There’s almost no good that can come of an irritated customer on the phone on your next bill cycle because their carefully-timed payment happened to cross in the mail.  Mad customers on the phone equals increased churn 100% of the time.

Now, instead of moving up one bill cycle, say from Monday to Friday, what if you do it through Wednesday of next week?  How about Friday?  Well, it gets worse for every bill cycle you move forward.  More payments cross in the mail and they cross earlier.

When you do the math, customer phone calls and churn increases tend to negate any postage savings gained by dropping bills earlier. 

So if pushing up your billing cycles earlier are out of the question, what would I move up and mail by Friday?

Customer acquisition efforts, certainly.  While it’s true that everybody is pushing hard this week to get in the mail, you still should try to get all completed mail into the mailstream by Friday.  The rationale is that your names will be a couple of days fresher and, because you’ve targeted your mailing carefully (right?), you’ll still stand out in the mail stream against some of the less-targeted efforts your prospects will receive.

Dunnings, particularly later ones.  Once you’re 2 or 3 deep in your dunning series, there’s not a lot of risk of payment crossover.  Once you’ve put the customer into a stop-ship status, feel free to mail earlier.  How much earlier?  Assuming you’ve got 3 or 4 weeks between dunnings, I’d feel comfortable pushing up the next 2 to 3 weeks of dunnings into the mail.  You might even find–as I have–that you might even want to roll out more aggressive dunning timing.

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