How to Strengthen Ad Mail by Building a Digital Information Market

The US Postal Service suffered a $5B loss in FY 2013 following on a $15.9B loss the year before. One of the challenges has been the diversion of revenues from physical ad mail to online channels such as Google and Facebook. This paper articulates the design of an information market that could help physical ads compete with digital ads. The proposed mechanism offers a closed loop information feedback with attractive properties. (i) Recipients can declare what mail they do not want and become protected thereafter. (ii) Advertisers may learn what recipients do want. (iii) Recipients are rewarded for data they volunteer. (iv) The mechanism provides a simple means to convert offline contact to online purchase. (v) A data layer facilitates business partnership with USPS in order to offer new services. (vi) A new type of stamp provides USPS with a new source of revenue