“Postal Brand Services and Unfunded Liabilities”

USPS Office of Inspector General: USPS Brand

The U.S. Postal Service Office of Inspector General (OIG) will award a firm fixed price contract to a supplier who possesses specific subject matter expertise in brand valuation and licensing. Also, the purpose of this solicitation is to select a supplier who can assist USPS OIG in identifying revenue opportunities by licensing or selling the Postal Service’s brand….

Brand Equity and Brand Value
A brand is a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors. As a result, the brand is the visual or tangible representation of a firm, product or service that consumers associate with the provision of products and services by the firm. The brand also possesses intangible aspects, such as a specific promise, personality or emotion that consumers associate with an entity when purchasing products or services.

The Postal Service corporate brand includes different elements, such as the solar eagle logo, trade dress (e.g., distinct uniforms of carriers or the postal trucks) and names (e.g., United States Postal Service). These elements convey information to consumers, allowing them to assign responsibility to the Postal Service for providing delivery of products and services. For example, the unique postal carrier uniforms distinguish and differentiate the Postal Service from others and serve as a signal to consumers that the Postal Service is delivering their mail.

Earlier this year, the OIG worked with an external contractor with expertise in brand valuation to develop a quantitative model and baseline estimate of the Postal Service’s brand value. The contractor conservatively estimated the Postal Service’s brand value at $3.6 billion in fiscal year 2013. The OIG published a white paper including the contractor’s methodology and model used to estimate the Postal Service’s $3.6 billion brand value. The OIG’s white paper suggests that the Postal Service can expect to realize $3.6 billion in future revenue as a direct result of its brand. The OIG would like to explore the possibility that this future revenue stream may be used to reduce its unfunded liabilities. The Value of the U.S. Postal Service Brand

The Postal Service $3.6 billion valuation is significantly lower than the brand values estimated for companies that compete primarily in package services, including DHL, FedEx, and UPS. Brand valuations for these companies range from about $9 billion to $43 billion. “This difference is not surprising,” PQC states, “given the emphasis and level of expenditures placed on advertising and marketing by these firms. Over the years they have consistently invested in their brands and developed strong brand equity, consciously following a strategy designed to make consumers aware of and loyal to these brands.” Moreover, the financial condition of the Postal Service, including high profiled “doomsday scenarios,” have adversely affected its brand.There are several other key points to keep in mind: The PQC estimate is a brand valuation estimate, not a corporate valuation estimate.

The supplier is expected to conduct research and analyses to identify potential revenue opportunities from licensing or selling a company’s brand. The supplier shall include benchmarking with other domestic and foreign companies, including state and local governments (if applicable). The supplier shall consider relevant factors such as 1) knowledge of the Postal Service organization and its operations, and 2) policies and procedures related to licensing or selling its brand. Further, the supplier shall identify various ways to use the Postal Service’s brand as potential revenue and provide revenue projections for the next 5 years.

In order to accomplish the above scope of work, the supplier shall perform the following tasks:

a. Kick-Off Meeting:

i. Schedule and coordinate a project kick-off meeting at the location approved by the OIG.

ii. Provide an introduction between the contractor personnel and OIG personnel who will be involved with the contract. At a minimum, the attendees shall include key supplier personnel, representatives from the directorates, other relevant OIG personnel, and the OIG contracting officer representative.

iii. Discuss technical, management, and reporting procedures.

iv. Discuss proposed milestones for dates and deliverables. Meeting location will be agreed upon at this time.

b. Research, Analyses, and Benchmarking:

i. Review and analyze the Postal Service licensing office’s strategic focus to determine the extent of brand revenue opportunities.

ii. Review and analyze the Postal Service’s licensing policies and procedures and how it allows for potential revenue opportunities.

iii. Benchmark with at least three domestic and foreign companies, and state and local governments (if applicable) who are licensing or selling their brand to generate revenue.

iv. Identify the best practices, successes and challenges the benchmarked companies face with licensing or selling its brand for revenue opportunities.

v. Compare the benchmarked results with the Postal Service’s existing licensing efforts.

see full solicitation