1 Product Information Great Lakes Area Focus Group August 14, 2014 Robert Cintron Vice President Product Information

® Product Visibility 2

® First to Last Mile: Technology is providing simplicity, convenience, accessibility, and affordability 3

First Mile Physical Network  Leverage market- leading physical assets  Incorporate evolving logistics solutions  Develop a structure that fosters agility and innovation  Boost the demand for mail and packages  Expand and simplify induction points  Integrate emerging digital, big data, and consumer trends to grow Last Mile  Expand delivery solutions  Capitalize on the expansion of E- commerce and technology  Optimize route flexibility and productivity Digital  Leverage USPS’s brand, trust, and reputation to drive profit Our Actions to Grow the Business Innovate Across Business Platforms 4

Be Disruptive, by Design Building a World-class Package Platform Build a network to meet delivery expectations while handling growth. Next Generation Equipment Integrated Package Network Plan Achieve 100% Package Visibility 03 5

01 6 Mainframe PC Land Line Smart Device 8” Floppy Disk Drive (1MB) USB Flash Drive (10GB = 10,000MB) Tablet Cell Phone Burn CD ( 700MB) Disruptive, by Design 6

Mail as the Hook Mobile Site, Smart Device “Oh, I’ve got to go to the website” Inspirational Reminder Targeted, Personalized Mail Piece Spike in Online and In-Store Activity Order Online Shop Online, Buy In-Store Fulfillment Exchanges & Returns The Hook Customer Experience Drives Loyalty Response Rates 7 Mail as the Hook

The Mailbox is the Hub If the Mail Piece is the Hook… 8 The Mailbox is the Hub

the mail moment College/University Acceptance Letter

® Next Generation Equipment 10 C007 Delivery Sortation System PASSReal-Time Scanners Mobile Delivery Device (Replaces Real-Time Scanners) Ring Scanners New Parcel Sorters New Tracking System Future Vehicles 10 12,5004,162210, ,000

® Electronic Info for Containers and Trays Received Piece level automation scans Full Service Customers Only All IMb™ Users 221,808, Billion (as of August 1, 2014) Container Scans Tray Scans Entered at USPS: 5,870,000 Enroute Arrive: 850,000 Enroute Depart: 291,000 7,011, ,164,000 Enroute: 149,344,000 Enroute Arrive: 12,387,000 Enroute Depart: 12,433,000 Visibility for Mailers Full Service Visibility Data from to

® Full Service Mail Trend In July 2014, 79% of Commercial mail eligible for Full-Service was Full-Service Note: Below graph depicts FS Adoption % as an avg. for the quarter; Slide title depicts the % for the latest month.

® Mobile Delivery Devices MDD

® Real-time scan data transmits every 15 seconds Replaces Current Technology Built-in GPS MDD Functionality Signature on glass – in testing Detailed customer delivery location 14 Sign on paper & scan Requires Clamshell Transmits scan data every 15 minutes Delivered scan event OldNew VS

15 Service Performance

16 Presort First-Class Mail® Score Trend Great Lakes Area Q4 TD Total Pieces Measured Processing % On-Time Last Mile Impact Overall Score Target Score SPLY Pieces Measured Volume Change SPLY Overall QTD Score SPLY Change Overnight 26,551, %-0.94%97.53%96.80% 18,402, %97.45%0.08% 2-Day 87,147, %-0.91%96.98%96.50% 53,062, %97.50%-0.52% 3-to-5-Day 294,455, %-1.01%94.84%95.25% 225,529, %95.48%-0.64% Total 408,155, %96.00% 296,993, %96.19%-0.45%

17 Presort First-Class Mail® by Service Variance – Great Lakes Area All QTD FCM scores would be above 99.13% (prior to last mile), if pieces that failed by 1 day passed Note: Volumes may not sum to 100% due to rounding.

18 Standard Mail® (Letters) Score Trend Great Lakes Area Q4 TD Total Pieces Measured Processing % On-Time Last Mile Impact Overall Score Target Score SPLY Pieces Measured Volume Change SPLY Overall QTD Score SPLY Change SCF Letters 191,092, %-0.66%95.51%91.00% 135,015, %93.22%2.29% NDC Letters 35,305, %-0.68%94.74%91.00% 24,075, %94.91%-0.17% E2E Letters 40,338, %-0.71%71.66%91.00% 15,322, %74.99%-3.33% Total 266,737, % 174,414, %90.50%1.31%

19 Standard Mail® (Letters) by Service Variance – Great Lakes Area QTD DSCF and DNDC Standard Letters scores would be above 98.71% (prior to last mile), if pieces that failed by 1 day passed Note: Volumes may not sum to 100% due to rounding.

20 Standard Mail® (Flats) Score Trend Great Lakes Area Note: Total scores include additional entry types not shown above. Q4 TD Total Pieces Measured Processing % On-Time Last Mile Impact Overall Score Target Score SPLY Pieces Measured Volume Change SPLY Overall QTD Score SPLY Change SCF Flats 46,170, %-5.55%90.96%91.00% 26,898, %90.78%0.18% NDC Flats 5,404, %-2.60%89.55%91.00% 5,240, %94.63%-5.08% E2E Flats 6,167, %-3.37%63.29%91.00% 1,945, %62.80%0.49% Total 57,742, % 34,084, %91.16%-0.34%

21 Standard Mail® (Flats) by Service Variance – Great Lakes Area QTD DSCF and DNDC Standard Flats scores would be above 96.71% (prior to last mile), if pieces that failed by 1 day passed Note: Volumes may not sum to 100% due to rounding. Note: DDU mail pieces were not included in the RPW Volume calculation.

22 Periodicals (Flats) Score Trend Great Lakes Area Q4 TD Total Pieces Measured Processing % On-Time Last Mile Impact Overall Score Target Score SPLY Pieces Measured Volume Change SPLY Overall QTD Score SPLY Change SCF Flats 17,665, %-7.26%87.15%91.00% 6,857, %88.31%-1.16% ADC Flats 2,724, %-4.02%91.78%91.00% 1,448, %86.70%5.08% E2E Flats 11,221, %-2.32%61.31%91.00% 3,949, %66.36%-5.05% Total 31,610, % 12,255, %82.60%-1.81% Note: Total scores include additional entry types not shown above.

23 Periodicals (Flats) by Service Variance – Great Lakes Area QTD DSCF and DADC Periodicals scores would be above 98.40% (prior to last mile), if pieces that failed by 1 day passed Note: Volumes may not sum to 100% due to rounding. Note: RPW Volumes were estimated using basic entry type proportions obtained from pricing. DNDC and DDU Volumes were not included in the chart.

In June 2014, 47% of Full Service Periodicals Flats entered in the Great Lakes Area were excluded from service measurement Mail Not In Measurement Exclusion Reason Breakdown Top Exclusion Reasons RankExclusion ReasonExclusion Description USPS/Mailer Attributed 1No Piece Scan No automation scan observed for the mail pieceBoth 2 Non-Compliant/ In Monitoring Mail identified as non-compliant due to observed inaccuracies or Mailers part of the 6 week monitoring period Both 3 Inaccurate Scheduled Ship Date Scheduled Ship Date is set to two or more days prior to the Postage Statement Finalization Date Mailer 4No Start-the-Clock Lack of a container unload scan or inability to identify the FAST appointment associated to the container USPS 5Incorrect Entry Facility eDoc entry facility does not match the facility specified in the associated FAST Appointment Mailer 6 Invalid Entry Point for Discount Claimed (MDF) Entry Point for Entry Discount claimed in eDoc is invalid based on container or mail piece destination Mailer 7PARS Mail piece redirected due to Change of Address (COA) or Undeliverable as Addressed (UAA) as indicated by ACS and/or PARS operation when mail piece is processed Mailer 8Non-Unique IMb eDoc contains mail pieces with a non-unique IMbMailer 9Orphan Handling Unit Mail piece associated to an Orphan Handling Unit having a BMEU induction Method Mailer 24

In June 2014, 36% of Full Service Standard Mail® Letters entered in the Great Lakes Area were excluded from service measurement Mail Not In Measurement Exclusion Reason Breakdown Top Exclusion Reasons RankExclusion ReasonExclusion Description USPS/Mailer Attributed 1No Start-the-Clock Lack of a container unload scan or inability to identify the FAST appointment associated to the container USPS 2No Piece Scan No automation scan observed for the mail pieceBoth 3 Non-Compliant/ In Monitoring Mail identified as non-compliant due to observed inaccuracies or Mailers part of the 6 week monitoring period Both 4 Invalid Entry Point for Discount Claimed (MDF) Entry Point for Entry Discount claimed in eDoc is invalid based on container or mail piece destination Mailer 5Non-Unique IMb eDoc contains mail pieces with a non-unique IMbMailer 6PARS Mail piece redirected due to Change of Address (COA) or Undeliverable as Addressed (UAA) as indicated by ACS and/or PARS operation when mail piece is processed Mailer 7Incorrect Entry Facility eDoc entry facility does not match the facility specified in the associated FAST Appointment Mailer 8 FAST Appointment Irregularity Associated FAST Appointment has incomplete/missing dataMailer 9 Non-Unique Physical IMcb eDoc contains container with a non-unique physical IMcbMailer 25

In June 2014, 47% of Full Service Standard Mail® Flats entered in the Great Lakes Area were excluded from service measurement Mail Not In Measurement Exclusion Reason Breakdown Top Exclusion Reasons RankExclusion ReasonExclusion Description USPS/Mailer Attributed 1No Piece Scan No automation scan observed for the mail pieceBoth 2 Non-Compliant/ In Monitoring Mail identified as non-compliant due to observed inaccuracies or Mailers part of the 6 week monitoring period Both 3 Invalid Entry Point for Discount Claimed (MDF) Entry Point for Entry Discount claimed in eDoc is invalid based on container or mail piece destination Mailer 4No Start-the-Clock Lack of a container unload scan or inability to identify the FAST appointment associated to the container USPS 5Incorrect Entry Facility eDoc entry facility does not match the facility specified in the associated FAST Appointment Mailer 6Orphan Handling Unit Mail piece associated to an Orphan Handling Unit having a BMEU induction Method Mailer 7Non-Unique IMb eDoc contains mail pieces with a non-unique IMbMailer 8 Inaccurate Scheduled Ship Date Scheduled Ship Date is set to two or more days prior to the Postage Statement Finalization Date Mailer 9 FAST Appointment Irregularity Associated FAST Appointment has incomplete/missing dataMailer 26

® Bundle Visibility 27

P&DC Data BUNDLE VISIBILITY Entry/Container Unload Scan (SV/IMDAS) APPS Bundle to Container SV Assign/Close Scans for Nesting Container Load Scan (SV) Arrived at Unit (IMDAS) Container Distributed (IMDAS) Out for Delivery Curtailed Inventory (IMDAS) Delivery Unit Delivered (Logical based on GPS) Visibility Reports SASP/BIDS PULSE/IV

Bundle Visibility Progress on bundle visibility Implemented Nesting Logic Upgraded Scanners with ability to scan Trailer barcodes (99T) July Pilot for exception scanning (Inventory Concept) generating new visibility events for Flats (bundles) Arrival-At-Unit Out for Delivery 29

Mailer Visibility Date Actual Bundle Scans (Top Piece) Assumed Bundle ScansData Recipients Wed 8/6 1,847,452 83,204,0983,172 Tue 8/5 2,147,02983,938,5043,131 Mon 8/4 3,045,885120,238,0602,991 Sun 8/3 3,552,370132,145,4342,751 Sat 8/2 5,066,505196,813,4702,926 Fri 8/1 2,890,573137,798,5023,027 TOTAL18,549,814754,138,068 * Scans are currently being monitored internally and are NOT provisioned to mailers Assumed bundle scans generated* for Full Service mailers based on By/For and data delegation rules 30

Mailer Visibility Date TOTAL Assumed Scans Enroute Arrival At Unit (Trailer Scan) Out For Delivery (Baltimore Test) Wed 8/683,204,09881,110,421 1,735,794357,883 Tue 8/5 83,938,50483,832,49770,37235,635 Mon 8/4 120,238,060119,324,054704,763209,243 Sun 8/3 132,145, Sat 8/2 196,813,470195,810,885897,925104,660 Fri 8/1 137,798,502136,978,349713,042107,111 TOTAL 754,138, ,201,6394,121,897814,532 * Scans are currently being monitored internally and are NOT provisioned to mailers Assumed bundle scans generated* for Full Service mailers based on By/For and data delegation rules by scan type 31

® National Bundle Breakage Analysis To determine the service impact of broken bundles: Multiple pieces in a bundle receive an APPS/APBS scan Based on analysis of IMb scan data from July 12 to July 25: 8.4% of the bundles were determined to be broken o ~11% for Standard Mail o ~3% for Periodicals For Standard Mail, broken bundles had a 0.8% lower service score than unbroken bundles For Periodicals, broken bundles had a 10.5% lower service score than unbroken bundles Based on analysis of July IMb scans and eDoc nesting data 32

® Surface Visibility 33

® Visibility for Full Service Customers Collect Nesting Data for Packages Track Movement of Containers SV is currently deployed to 178 sites and is an integral data collection mechanism for numerous mission critical functions. Service Performance – Start-the-Clock Mail Visibility & Tracking Product Information eInduction – Mail Acceptance Automated Sampling Transportation Management Trailer Utilization Exception Reporting Mail Entry Operations Surface Visibility Benefits Mailers 34

® SV 2014 Expansion SV 2014 Expansion Summary January 2014, Surface Visibility expanded to ten new sites as part of an overall plan to increase the amount of Drop Shipment volume accepted using the SV application to support eInduction All expansion sites have full SV functionality Project is complete 35

® SV 2014 Expansion JAN-JULY 2014 TOTAL: DROPSHIP CONTAINERS % VOLUME SV SITE3,828,17583% NON-SV SITE787,61217% 36

® Package Tracking 37

® 38 Current Metrics January 2015 Target 91.19% Schemeless Dynamic Routing 11 Digit DPV, Address and/or Zip+4 Data 11 Digit DPV and/or Address Data 87.40% 98% 97.2% Barcoding 99% 90.35% Shipping Services File 1.6 or Higher 97% By January 2015, Commercial Mailers must provide 11 Digit DPV and/or Address Data 100% Package Visibility is increasing its metrics: Week ending 8/1/14 38

® 39 From: Current Event DescriptionTo: New Event DescriptionRelease Date Dispatched to Sort Facility Depart Post Office April 27, 2014 Electronic Shipping Info Received Pre-Shipment Info Sent to USPS July 27, 2014 Arrive USPS Origin Sort Facility Arrived at USPS Origin Facility July 27, 2014 Arrive USPS Sort Facility Arrived at USPS Facility July 27, 2014 Processed Through USPS Sort Facility Arrived at USPS Facility (If first scan at location, else suppressed) July 27, 2014 Depart USPS Sort Facility Departed USPS Facility July 27, 2014 AcceptancePicked Up ( When picked up at Customer Location ) Accepted ( When shipped at Postal Facility ) August 10, 2014 Prepared for Agent Shipping Label Created August 10, 2014 Updates to Tracking Language

® 40 USPS SMS Tracking™ USPS T EXT T RACKING ™ Launched March 27, 2014 Over 3 million messages a month Almost a million unique mobile numbers Two ways to track on the go! Text your tracking number to (2USPS) Sign up online on USPS Tracking website

® Delivery Location Attributes  Captures delivery location for packages  Event Code will remain ‘Delivered’, but carrier will select delivery location attribute(s) ‘Left with Individual’ ‘In/At Mailbox’ PTR Release 2.0 Delivery Location Attributes In/At Mailbox Front Door/Porch Parcel Locker Left with Individual (at Address) Front Desk/Reception Other at Address (Garage/Side or Back Door/Porch) Neighbor (by Request) 41

® 4.6 Billion increase in scans FY14 to-date over FY13 Almost 24 Billion more scans than FY09 AVERAGING 9.3 SCANS PER PIECE 42

® What do we need? Mailers Align electronic data to match where postage is applied and packages deposited Verify: Entry Point and Discount Scheduled Ship Date Create seamless, positive experiences for our mutual customers Barcode quality and uniqueness Prior to tendering packages: Submit Shipping Services File Shipping Partner Events John Doe 123 Main St. Anywhere VA John Smith 345 Digitize Way Last Mile MD Submit eDoc when letters/flats are tendered Upgrade to Shipping Services File version 1.7 or 2.0 and include return address 43

® What do we need? USPS MTEL Placards need unique barcodes on every outgoing container Create seamless, positive experiences for our mutual customers Load Trailer Arrive / Depart Nesting – Placard Assign Closed All mail on Automation Scan, Scan, Scan Create firms sheets for Firm & Caller Delivery 44