Usps: The “We Deliver” Campaign

24 Pages Posted: 21 Oct 2008

See all articles by Mark E. Parry

Mark E. Parry

University of Missouri at Kansas City - Department of Organizational Leadership/Marketing

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Abstract

U.S. Postal Service executives are reviewing the results of a tracking study completed under the direction of Young and Rubicam. The study indicates that the "We Deliver" campaign improved perceptions of USPS significantly, but the positive effects declined after the campaign ended. Wargo and DeVar must decide whether to continue the campaign or alter it in any way.

Excerpt

UVA-M-0371

USPS: THE “WE DELIVER” CAMPAIGN

In March 1989, John Wargo, assistant postmaster general for marketing, and Rod DeVar, general manager for the Creative Services division, of the United States Postal Service (USPS), were reviewing the results of a tracking study completed the previous month under the direction of Young & Rubicam (Y&R). The study traced the effects of the recently developed “Products and Services” campaign on consumer attitudes toward USPS. That campaign consisted of two 30-second spots that aired on network television in the fall of 1988. The spots identified a variety of USPS products and services and linked them together under the “We Deliver” theme. The results indicated that the campaign improved consumer perceptions of USPS significantly, but the positive effects declined notably after the campaign ended. Wargo and DeVar wondered how well the “Products and Services” theme and music would contribute to the 1989 Express Mail (EM) advertising campaign's success.

The Market

In 1988, the market for overnight delivery service (ONDS) was $ 6 billion, and overnight letters represented 52% of 1988 volume by category. The market was expected to grow about 11% per year through 1993, down from the 20% annual growth rate that characterized the previous five years. Trends in ONDS use are described in Exhibit 1, while major competitors are compared in Exhibit 2.

With a 1988 unit share of 50%, Federal Express (FedEx) was the acknowledged ONDS market leader, reporting about $ 3.9 billion in revenues for the fiscal year ended May 31, 1988. Although FedEx gained two market share points from 1986 to 1988, the company was experiencing declining profit margins. FedEx used volume discounts to secure a large share of business accounts. It also offered customers warehousing and inventory management in conjunction with expedited delivery of packages. In response to challenges by United Parcel Service (UPS), FedEx had relaxed shipment weight restrictions and test-marketed a lower cost afternoon delivery option for packages weighing up to five pounds. To attract small businesses, FedEx introduced retail kiosks and drop-off discounts. (The cost of an eight-ounce letter was $ 10.50, but FedEx offered a $ 3.00 discount to customers who delivered their letters to the local FedEx retail office.) Finally, FedEx expanded its overseas operations through the acquisition of Flying Tigers.

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Keywords: advertising, marketing research, U.S. Postal Service

Suggested Citation

Parry, Mark E., Usps: The “We Deliver” Campaign. Darden Case No. UVA-M-0371, Available at SSRN: https://ssrn.com/abstract=909949 or http://dx.doi.org/10.2139/ssrn.909949

Mark E. Parry (Contact Author)

University of Missouri at Kansas City - Department of Organizational Leadership/Marketing ( email )

5110 Cherry St.
Kansas City, MO 64110
United States

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