Stamps.com Inc.(STMP) Stamps.com’s Management to Present at the 14th Annual Needham Growth Conference Call January 12, 2012 01:30 pm ET Executives Kyle Huebner - CFO Analysts Presentation Unidentified Analyst Good afternoon and welcome back and we will get the afternoon session started with Kyle Huebner, CFO of Stamps.com. Kyle Huebner
The postage that customers buy is a passthrough to the USPS so that's not included in our revenue or financial statements. So the core functionality allows customers to buy and print their own postage, there's three ways that they can print postage, through printing their own stamps, we call net stamps, printing out envelopes or printing on shipping labels designed for packages.So I will just touch on each of those in a little more detail. Again this is how it works for the customer. The first way to print postage is printing that stamps here, a customer buys a sheet of blank label stock from us and then they use the software to print out the postage as they need it. There is no address associated, no date associated with it as other metering solutions have. So that’s really the most flexible kind of postage a customer can use. They can buy standard labels, theme labels or they can actually upload their business image and we will print out customized label for them to use. Secondly as a customer can print on an envelope, directly on an envelope around labels that go in on an envelope, typically a customer will print, use this way to print postage if they are already planning on printing the destination address and return address. So we consolidated a two-step process into a one-step process where they print out the postage and the address. We integrate with all the address mailing software, contact management databases. So you don’t have to maintain two different address books. And one of the benefits of this is that we will validate the destination address against the USPS database to ensure that it’s a valid, accurate deliverable address. So customers can save money by avoiding printing postage on mail pieces that we get returned as undeliverable. The third way to print postage is, it’s a shipping label designed specifically for use with packages, customers can print it on a piece of printer paper and tape it to the package or they can print it on adhesive labels, it supports all the USPS package classes, Priority, Express, Media Mail, Parcel Post.
Another discount, a big benefit for our customer is that they can get discounted rates on Priority and Express over the rates at the retail post office and so those discounts range from about 2% to 21% discounts, even higher if you meet certain volume requirements, you can get 30% discount rates. You get discounts on package, tracking and confirmation services. And then as an electronic solution, our solution makes it easier for customers to manage their package and shipping. We can automatically send emails to customers that can automatically return an email when it’s scanned and delivered. Customers have more ability, visibility in the process. We can hide the postage values which is a popular feature with e-commerce merchants.So that’s how our customers can print postage using our software application. In addition we have integrations, where customers use the front end integration to print postage. Couple of our key ones, ones with Microsoft on the small business side. So, we are integrated with Office. Customers can, a lot of small businesses typically print the address on the envelope using Word. So we integrate with Word and they can pull on the postage from their Stamps account and print out the postage and the address all within one step from the Word application. This is in the envelopes and labels feature as well as the Mail Merge feature which is also popular with small businesses. On the shipping side where we are targeting shipping customers, we have an integration with Amazon into their merchant market place. So any Amazon merchant selling on Amazon’s merchant market place where they are filling the goods, when they got to process the transaction, they have an option to print out a shipping label for their package and that’s a exclusive partnership arrangement we have with Amazon to integrate and provide them the postage on the backend. Read the rest of this transcript for free on seekingalpha.com