RARC-WP-18-004 – March 5, 2018
- First-Class Mail is the Postal Service’s biggest provider of revenue and contribution. However, its portion of overall postal revenues has fallen from over 60 percent in the late 1970s to just 40 percent in 2016.
- Depending on whether key historical trends continue, intensify, or weaken, the future of correspondence mail could vary greatly. We present five hypothetical scenarios for what correspondence mail volumes would be in 2026 should the scenarios occur.
- The Postal Service may need to continue to seek innovative ways to integrate digital features into physical pieces of correspondence mail to enhance the product’s relevance to the American public.
Although the decline of First-Class Mail volume rightfully gets a lot of attention, it is important to understand the underlying trends affecting its key segments, including correspondence mail. This paper examines how key and interrelated factors like electronic diversion, demographic changes, the economy, pricing, and evolving security and privacy concerns have affected the growth and decline of correspondence mail during the past 15 years, as well as how these factors could affect correspondence mail in the future.
In the face of continued declines of correspondence mail volume, the Postal Service should continue its work to find innovative ways to enhance the product’s relevance to the American public. This paper highlights some of this work and suggests additional strategies the Postal Service could pursue to shore up this important product.