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Ads seen as next step in personalized postage


The US Postal Service is expected to decide shortly on whether to launch a test program that would allow advertising on postage.

It's part of the agency's effort to make postage more popular in an era when e-mail has been reducing the volume of first-class mail. The test would be an expansion of an existing program in which authorized websites, including Stamps.com, Zazzle.com, and PictureItPostage.com, allow people to personalize postage with photos.

Nakia Cocanougher of Quincy used stamps that Zazzle.com made from a photo of fiance David Roby kissing her on cards she mailed to alert family and friends of her upcoming wedding.

''People's reactions were, 'Oh, my God, my friend's picture is on a stamp,' " she said.

The cost of such stamps generally ranges from 85 to 90 cents for the equivalent of a 39-cent stamp when ordered in a sheet of 20. Websites paid the Postal Service a $250,000 fee that allows them to sell the stamps as part of a program that began nearly a year ago.

''The results so far have been positive," said Postal Service spokesman Gerald McKiernan.

Technically, only the Postal Service can issue stamps. What Stamps.com and other companies are selling are postage labels with an image in the middle, McKiernan said. To the untrained eye, they look like stamps, and they're valid postage.

The traditional stamp business has been declining for some time. The volume of first class stamps that are put on a single piece of mail has fallen to 43.3 billion pieces last year from 54.3 billion in 1998.

Stamps.com calls the personalized postage it offers PhotoStamps. Between the test launch last May and the end of 2005, the company shipped more than 10 million individual PhotoStamps, said chief executive Ken McBride.

Stamps.com's main business is providing on-line postage services to small businesses. But personalized postage is growing rapidly. The Los Angeles company earned $10.4 million on revenue of $62 million in 2005, with about $9 million of revenue coming from PhotoStamps.

Hoping to expand its business, Stamps.com was recently part of a successful lobbying effort to revise a law that prohibited ads in postage. The Postal Service is expected to decide soon whether to launch a test program that would allow postage advertising, McKiernan said.

Growth in customized stamps is being driven by people like Bruce Peterson, a commercial photographer in Boston who used Stamps.com to turn some of his photos, including a favorite frog picture, into stamps. When submitting bills to clients, he's started including sheets of stamps as a way of saying thank you.

''They're a big hit," he said.

To turn photos into stamps, consumers upload an image from a personal computer to the website of Stamps.com and place an order.

After Benjamin Currey was born last month, his mother, Sari Harmony Currey of Boston, spotted an ad for Stamp.com's PhotoStamps and had stamps made from a baby picture. ''Everybody loved them," she said. ''And we tucked away a sheet for ourselves."

Some requests are rejected. After pranksters had photos of Unabomber Ted Kaczynski and other notorious figures made into Stamps.com postage during a brief 2004 marketing test, the company has sought to crack down on anything that might violate copyrights or be deemed inappropriate.

Personalized postage is also a sideline for Zazzle Inc., which lets visitors to its Zazzle.com website create images for T-shirts, posters, and cards. Customers can also use content from other sources such as Walt Disney Co., which Zazzle has agreements with.

Another player in personalized postage is Endicia, which operates PictureItPostage.com. Like Zazzle, it's a private California company that doesn't disclose financial information.

Local marketing specialists aren't convinced that postage will be a good advertising vehicle. Mass mailings are already so emblazoned with marketing messages that adding another in the form of postage could amount to overload, said Larry Weber, chief executive of W2 Group in Waltham.

''It's like putting another logo on a NASCAR" racer, Weber said.

At ad agency Mullen in Wenham, senior vice president Andrew Pelosi said customized postage might not make sense for mass mailers. Companies sending mass-mailings generally use postage meters because the process of attaching stamps adds cost.

Still, Pelosi said, advertising on postage ''could make sense for a small company doing a niche mailing."

But Stamp.com's McBride thinks big companies will try advertising on postage because consumers tend to regard envelopes with meter-mark postage as ''junk mail."

At Endicia, vice president Mark Delman is bullish.

When consumers use personalized postage, he said, ''They get calls from recipients saying, 'Wow, this is the coolest thing I've ever seen.' "

Chris Reidy can be reached at reidy@globe.com.

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