USPS Postal Rate Increases Explained and How They Affect Your Direct Mail Campaigns

If you’ve wondered how the United States Postal Service (USPS) prices their products, you aren’t alone. With prices changing over the years and with costs varying for different products, it’s easy to assume that USPS pricing is arbitrary. However, this is not the case. United GMG thoroughly explains USPS direct mail pricing below—and we’ll also discuss 2022 rates, so you’ll know what to expect for the year.

How Does USPS Price Their Direct Mail?

According to federal law, USPS products are divided into two categories: market-dominant and competitive. There are different pricing rules for both categories.

Market-Dominant Products

Market-dominant products are considered to be market-dominant because there is no other way to physically deliver them besides through USPS.

Market-dominant products include:

  • First-class mail
  • Marketing (Standard) mail
  • Periodicals
  • Package services (i.e., library mail)
  • Extra services (i.e., certified mail)

For market-dominant products, USPS is required by law to seek approval from the Postal Regulatory Commission (PRC) in order to change prices. In other words, market-dominant products have a “price cap” that can’t rise above the inflation rate.

Competitive Products

Competitive products are products that can be delivered through other means, such as items that can be delivered electronically.

Competitive products include:

  • Priority mail
  • Priority mail express
  • Commercial package services

With competitive products, USPS has the ability to change the prices with more flexibility. However, the Postal Regulatory Commission will regularly check USPS prices in order to make sure that they follow legal requirements.

2022 Postal Rates UnitedGMG

July 10, 2022: Postal Rate Increases

USPS recently filed notice with the Postal Regulatory Commission of market-dominant price changes to take effect July 10, 2022. If approved, the new prices include a two-cent increase in the price of a First-Class Mail Forever stamp from 58 cents to 60 cents. Below, United GMG discusses the changes for several different products and how these price increases affect businesses and marketers.

2022 Prices Changes for First-Class Mail

Percent Change for First-Class Mail

  • Single-Piece Letters/Postcards: 5.245%
  • Presort Letters/Postcards: 6.863%
  • Flats: 9.204%
  • Outbound Single-Piece First-Class Mail International: 7.372%
  • Inbound Letter Post: 0.033%
  • Total First-Class Mail: 6.506%

First-Class Mail First-Ounce Rates – Letters

ProductCurrentNewChangePercent Change
Stamped Single-Piece$0.58$0.60$0.023.4%
Metered Single-Piece$0.53$0.57$0.047.5%
MAADC8 Automation$0.485$0.515$0.0306.2%
AADC Automation$0.461$0.491$0.0306.5%
5-Digit Automation$0.426$0.455$0.0296.8%

2022 Price Changes for Marketing Mail

Percent Change for Marketing Mail

  • Letters: 6.151%
  • Flats: 8.543%
  • Parcels: 9.785%
  • High Density / Saturation Letters: 8.326%
  • High Density / Saturation Flats and Parcels: 4.769%
  • Carrier Route: 8.657%
  • Every Door Direct Mail – Retail: -6.500%
  • Overall: 6.500%

2022 Price Changes for Package Service

Percent Change for Package Service

  • Alaska Bypass Service: 6.533%
  • Bound Printed Matter Flats: 4.166%
  • Bound Printed Matter Parcels: 10.516%
  • Media Mail and Library Mail: 8.897%
  • Overall: 8.511%

Proposed Mailing Service Price Changes

ProductCurrent PricePlanned Price
Letters (1oz)$0.58$0.60
Letters (metered 1oz)$0.53$0.57
Letters Additional Ounces$0.20$0.24
Domestic Postcards$0.40$0.44
International Letters (1oz)$1.30$1.40

The proposed prices would raise First-Class Mail prices about 6.5 percent, less than the 7.9 percent rate of inflation as of the end of February, according to the Bureau of Labor Statistics.

Considering increasing operating costs and inflation, these price adjustments will make it easier to implement the Delivering for America plan, which includes an investment of $40 billion in core Postal Service infrastructure over the next decade.

The PRC will review the prices before they are scheduled to take effect.

How the 2022 Price Postal Rate Increases Affect Businesses

These postage increases can impact any business. And unfortunately, it’s something you have little control over.

Depending on the volume of and type of mailings you do through USPS, the effect of these rate changes will vary from industry to industry, and from business to business. However, in industries with high transactional mail volumes, any slight increase will inflate your budget.

Price hikes are coming—so it is now more important than ever to optimize printing and mailing costs for your business. That’s where United GMG can help.

Get Started on Your Next Direct Mail Project at United GMG

Interested in getting started on your next direct mail project? Contact us at United GMG today. Our experts can help you develop, produce, and mail the most cost-effective direct mail pieces and help bring your unique vision to life, without breaking the bank!

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August 29, 2021: Postal Rate Increases

On Sunday, August 29, 2021, USPS increased postal rates for market-dominant products, which include First Class Mail letters and postcards. What does this mean for your business? United GMG explains how this affects businesses and marketers and what you can do to take advantage of this price increase when it comes to your direct mail marketing campaigns. 

2021 Price Changes for First-Class Mail

First Class Mail letter (1 oz.) rates will increase from $0.55 to $0.58. For each additional ounce for First Class Mail, there will be no change in price and will still cost $0.20.

2021 Price Changes for Postcards

Current First-Class Mail 4.25” by 6” postcard rates

  • $0.36 for Retail
  • $0.285 to $0.269 for Auto Presort

After August 29th, 2021

  • Retail price will increase to $0.40 
  • Auto Presort rate will increase to a range of $0.326 to $0.306 for both 4.25” by 6” postcard and 6” by 9” postcard sizes.

What Opportunity Does This Create for Businesses and Marketers?

Now, marketers have more than twice the amount of room to engage with consumers for the same price! There are many benefits to using a larger postcard for your direct mail marketing campaign. 

  • Larger Postcards Stand Out: A larger postcard will stand out in your customer’s mailbox among all of the competing mail. They’ll be more likely to notice and gravitate towards your postcard. 

  • More Room for Imagery and Text: You’ll also have room to add more impactful images to grab consumers’ attention. There’s more space for attention-grabbing headlines and larger text as well. This extra space means you can avoid using small text or a crowded layout that may discourage consumers from engaging with your mail.

  • Room to Include New Technologies: With larger postcards, you can also add technology like QR codes or smart speaker activations to convert leads without taking up too much space and creating a crowded design.

January 21, 2021: Postal Rate Increases

On January 24, 2021, USPS changed many of their prices on direct mail products. Below, United GMG discusses the changes for several different products.

2021 Price Changes for Letters

In order to remain competitive for 2021, the Postal Service Board of Governors approved to raise Mailing Services product prices 1.8% for First-Class Mail and raise prices 1.5% for other letters in this category. For domestic letters, this price change was based on the consumer price index. For international shipping, however, the prices were adjusted based on market conditions. Below is a breakdown of 2021 prices for USPS letters at the Mailing Class rate:

  • Mixed AADC:
    • Marketing Letters: 30.4 cents (compared to 29.9 cents in 2020)
    • Marketing Flats: 72.6 cents (compared to 63.2 cents in 2020)
    • Non-Profit Letters: 18.3 cents (compared to 17.8 cents in 2020)
    • Non-Profit Flats: 53.2 cents (compared to 43.2 cents in 2020)
  •  5-Digit:
    • Marketing Letters: 25.9 cents (compared to 25.9 cents in 2020)
    • Marketing Flats: 45 cents (compared to 41.2 cents in 2020)
    • Non-Profit Letters: 13.8 cents (compared to 13.8 cents in 2020)
    • Non-Profit Flats: 25.6 cents (compared to 24 cents in 2020)
  • ECR Basic:
    • Marketing Letters: 29.6 cents (compared to 29.4 cents in 2020)
    • Marketing Flats: 32 cents (compared to 30 cents in 2020)
    • Non-Profit Letters: 21 cents (compared to 20.9 cents in 2020)
    • Non-Profit Flats: 23 cents (compared to 21.6 cents in 2020)
  • ECR High Density Plus:
    • Marketing Letters: 20.1 cents (compared to 20 cents in 2020)
    • Marketing Flats: 23.2 cents (compared to 23.2 cents in 2020)
    • Non-Profit Letters: 11.6 cents (compared to 11.7 cents in 2020)
    • Non-Profit Flats: 14.4 cents (compared to 14.4 cents in 2020)
  • ECR High Density:
    • Marketing Letters: 21.9 cents (compared to 20.9 cents in 2020)
    • Marketing Flats: 25.8 cents (compared to 25 cents in 2020)
    • Non-Profit Letters: 13.3 cents (compared to 12.4 cents in 2020)
    • Non-Profit Flats: 16.8 cents (compared to 16.6 cents in 2020)
  • ECR Saturation:
    • Marketing Letters: 19.1 cents (compared to 19.1 cents in 2020)
    • Marketing Flats: 22.4 cents (compared to 22.6 cents in 2020)
    • Non-Profit Letters: 11.1 cents (compared to 11.1 cents in 2020)
    • Non-Profit Flats: 13.6 cents (compared to 13.6 cents in 2020)

2021 Price Changes for First-Class Mail

  • Non-Auto Single Piece (Machinable) (Up to 1 ounce):
    • Letters: 55 cents (compared to 55 cents (with stamp) in 2020)
    • Cards: 36 cents (compared to 35 cents in 2020)
    • Flats: $1 (compared to $1 in 2020)
  • Non-Auto Single Piece (Additional Ounce):
    • Letters: 20 cents (compared to 15 cents in 2020)
    • Flats: 20 cents (compared to 20 cents in 2020)
  • Presorted (up to 3.5 ounces):
    • Machinable Presorted:
      • Letters: 46 cents (compared to 45.9 cents in 2020)
      • Cards: 29.3 cents (compared to 28 cents in 2020)
      • Flats: 87 cents (compared to 80.3 cents in 2020)
    • Mixed AADC Automation:
      • Letters: 45 cents (compared to 43.9 cents in 2020)
      • Cards: 28.5 cents (compared to 27.4 cents in 2020)
      • Flats: 77.4 cents (compared to 72.7 cents in 2020)
    • AADC Automation:
      • Letters: 42.8 cents (compared to 41.9 cents in 2020)
      • Cards: 27.9 cents (compared to 26.8 cents in 2020)
      • Flats: 66.6 cents (compared to 63.6 cents in 2020)
    • 3-Digit Automation:
      • Flats: 61.8 cents (compared to 77.7 cents in 2020)
    • 5-Digit Automation:
      • Letters: 39.8 cents (compared to 38.9 cents in 2020)
      • Cards: 26.9 cents (compared to 25.7 cents in 2020)
      • Flats: 46 cents (compared to 63 cents in 2020)
    • Additional Ounce:
      • Flats: 20 cents (compared to 20 cents in 2020)
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