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To Those Who Say the Postal Service Got What They Paid For

Just a couple of articles from back in the day:

USPS to Drop Lance Armstrong Sponsorship

According to a February 2003 USPS Inspector General (OIG) report, the objective of the sponsorship was to "increase revenue and sales of Postal Service's products on a global basis and to increase sales in key international markets" with a specific monetary goal of increasing [annual international] revenue by $20 million. However, despite the cycling team's outstanding performance and extremely high profile, revenues from USPS international operations in 2003 were actually $12.8 million less than four- years earlier in 1999.

USPS Blasted for Its Sports Sponsorships

The recent $40 million sponsorship contract with the team "does not include the costs associated with sending postal executives and their spouses on junkets to the Tour De France as they have done in the past," said Leslie K. Paige, director of special projects for CAGW, in a statement. Paige continued that the USPS offers "no verifiable evidence" that these sponsorships raise brand awareness in Europe while generating $19 million in annual revenue

Postal Service Shouldn’t Dabble In Sports Sponsorship

From any management perspective, the Postal Service’s sports sponsorships have been an unnecessary drain, if not a disaster – at least for stamp-buyers. Besides cycling, USPS has magnanimously bestowed your postage dollars on other professional teams as well, including the impoverished New York Yankees and New York Giants.

USPS Races Downhill and Loses Money

“Postal officials routinely pedal the line that sponsorship of the cycling team raises ‘brand awareness’ in Europe and results in $19 million in revenue annually. Yet, they present no verifiable evidence of this and, according to the IG report, fail to quantify any impact to the bottom line with any of its sports sponsorships. International sales account for only 2.6 percent of the USPS’ total revenue and anecdotal evidence suggests that the USPS’ performance in the international arena is substandard. Congress, the Presidential Reform Commission, and the USPS Board of Governors ought to put the brakes on these wasteful expenditures,” Paige said.
 
Oct 29, 2009
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Thanks for this, Mac, it helps put to rest those spurious 'USPS got good value' arguments.

I remember someone posting some info like this in a thread a couple of months ago, either your good self or RR.
 
flicker said:
YUP I think all commercial sponsorship of cycling is a waste of money. Who needs pro teams anyway?

Reductio ad absurdum is not a relevant response here. First, USPS isn't a commercial entity, it's a government entity. Second, not all commercial entities benefit from a cycling sponsorship. Certainly, some benefit greatly, while others get little or no return on their dollar. Just because one loses money doesn't mean they all do.
 
Statistics never lie but liars use statistics. In 2002 the USPS lost 1.5 billion dollars and in 2009 it lost over 4 billion dollars. In the first half of 2010 losses are on comparable to 2009. Could I make an argument that the USPS cycling team kept losses at a minimum during it period of sponsorship. Of course I could but it would be ridiculous because I can't make the link with any certainty. Just like you can't state they didn't get there monies worth because you can cut and paste some articles from prestigious sources like about.com.
 

flicker

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JRTinMA said:
Statistics never lie but liars use statistics. In 2002 the USPS lost 1.5 billion dollars and in 2009 it lost over 4 billion dollars. In the first half of 2010 losses are on comparable to 2009. Could I make an argument that the USPS cycling team kept losses at a minimum during it period of sponsorship. Of course I could but it would be ridiculous because I can't make the link with any certainty. Just like you can't state they didn't get there monies worth because you can cut and paste some articles from prestigious sources like about.com.

No, no and no. Financial losses at USPS started the minute Uni B. and Bruyneel became invlved with USPS. It has begun spiraling out of control since then. Also the gulf oil spill(caused by Lance) and the economic meltdown (Bruyneel and Lance in tandem). These guys are bad news. I heard Lance is personally involved in Ozone depletion also.
 
Jul 23, 2010
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flicker said:
No, no and no. Financial losses at USPS started the minute Uni B. and Bruyneel became invlved with USPS. It has begun spiraling out of control since then. Also the gulf oil spill(caused by Lance) and the economic meltdown (Bruyneel and Lance in tandem). These guys are bad news. I heard Lance is personally involved in Ozone depletion also.

at least he is not to blame for the Mexican drug wars.
 
May 23, 2010
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Moose McKnuckles said:
Reductio ad absurdum is not a relevant response here. First, USPS isn't a commercial entity, it's a government entity. Second, not all commercial entities benefit from a cycling sponsorship. Certainly, some benefit greatly, while others get little or no return on their dollar. Just because one loses money doesn't mean they all do.

I don't know about USPS' view in Europe but for many here in the states USPS as a title sponsor has to look about like what the IRS would..The IRS has an advertising budget too but sponsoring a bike team would not look good. Same for the EPA (DEA would be funny) or anything with letters associated with the government. USPS should have just bought advertising outright. I think return on advertisement dollars is subjective too..Companies have bet the farm on a handful of Superbowl commercials and failed..Maybe they only failed half of fast because of it.
 
Jul 6, 2009
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flicker said:
No, no and no. Financial losses at USPS started the minute Uni B. and Bruyneel became invlved with USPS. It has begun spiraling out of control since then. Also the gulf oil spill(caused by Lance) and the economic meltdown (Bruyneel and Lance in tandem). These guys are bad news. I heard Lance is personally involved in Ozone depletion also.

thats pretty funny at first i thought you were serious.
 
In order for USPS to get what they paid for they would not have to show an actual return on investment.

When you buy an ad, you pay for the ad. If you get the ad, you got what you paid for, regardless of whether the ad brings in more business or not.

What USPS paid for was title sponsorship of a cycling team. They got that sponsorship. So, they got what they paid for. Whether that sponsorship translated into increased exposure and revenue is a separate matter.
 
JRTinMA said:
Just like you can't state they didn't get there monies worth because you can cut and paste some articles from prestigious sources like about.com.

Except, I didn't claim it. The Postal Service did. You don't like about.com? That's cool. Here's the actual report. Knock yourself out.

Audit Report – Postal Service’s Involvement in Sponsorships

The Postal Service was unable to fully validate over $130 million in revenue claimed from two sponsorships. Based on interviews with sales representatives and national account managers, combined with financial analyses, we verified only $698,000 of the $18 million claimed by the Postal Service over a 4-year period as revenue generated as a result of the Pro-Cycling team sponsorship. In addition, the Postal Service was not able to validate the $112 million claimed in 1999 as revenue from sponsorship of the New York Yankees. Postal Service managers stated this new revenue would have been attained regardless of the sponsorship, and it would be difficult to link the revenue to the New York Yankees’
sponsorship because so many other factors contribute to increased revenue. As a result, claims of monetary benefits are unsubstantiated and future business decisions that were made based on those claims may result in a waste of funds.

I suppose the Postal Service's own Office of Inspector General can't make the claim either...
 
Nov 17, 2009
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MacRoadie said:

First of all... the post office should never have been sponsoring a cycling team. I can't see what benefit they got out of it.

But... if you are sponsoring a cycling team and you want them to get good results... particularly results that play well to americans... then I'm not sure what more the cycling team could have done.

In the US... the TDF is pretty much everything. And the team won it a bunch.

Was it a poor business move? Absolutely. Did the team deliver on the sponsorship? I think you have to say yes... all they can do is ride the races.
 
Jan 27, 2010
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flicker said:
No, no and no. Financial losses at USPS started the minute Uni B. and Bruyneel became invlved with USPS. It has begun spiraling out of control since then. Also the gulf oil spill(caused by Lance) and the economic meltdown (Bruyneel and Lance in tandem). These guys are bad news. I heard Lance is personally involved in Ozone depletion also.

But LA is responsible for the Radon leaking into your basement thru the cracks in concrete which has been weakened by the USPS/LA shrine you've constructed. This has caused you to become delusional and hear voices. But due to the massive LA-shrine debt you've amassed you cannot afford to layer tin-foil around the inside of your basement. Instead, you block out the antiLance voices by placing little, tiny, picometer sized pieces of foil into each external auditory meatus.

Sorry dude I just had to. I've read your stuff before... you are tip-toeing on entry into the world of insanity.

NW
 
Regardless of whether USPS got the requisite bang for their buck or whether they even should have been sponsoring a bike team, they did produce one of the best cycling-related commercials. I couldn't find a link for it, but it basically had the USPS team out riding around delivering mail only to be shocked to learn that they were expected to be back the next day and do it all over again. I always thought that it would have been hilarious if the riders really had to go on these postal rides in the offseason.
 
kurtinsc said:
First of all... the post office should never have been sponsoring a cycling team. I can't see what benefit they got out of it.
Advertising, public awareness. Most large corporations do it. It's why you walk into a store and ask for Kleenex, Tylenol and Clorox instead of tissue, acetaminophen, Sodium Hypochlorite and sodium hydroxide. Brown does it and so does Fedex.

Ninety5rpm said:"In order for USPS to get what they paid for they would not have to show an actual return on investment.

When you buy an ad, you pay for the ad. If you get the ad, you got what you paid for, regardless of whether the ad brings in more business or not."

In spite of how poorly managed the USPS is/was they actually grew the business during those years. http://www.nalc.org/postal/perform/productivity.html
 
Jun 28, 2009
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Ninety5rpm said:
In order for USPS to get what they paid for they would not have to show an actual return on investment.

When you buy an ad, you pay for the ad. If you get the ad, you got what you paid for, regardless of whether the ad brings in more business or not.

What USPS paid for was title sponsorship of a cycling team. They got that sponsorship. So, they got what they paid for. Whether that sponsorship translated into increased exposure and revenue is a separate matter.

+1 ....adding bogus characters here to meet the 10 character limit :p
 
Nov 17, 2009
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xmoonx said:
Advertising, public awareness. Most large corporations do it. It's why you walk into a store and ask for Kleenex, Tylenol and Clorox instead of tissue, acetaminophen, Sodium Hypochlorite and sodium hydroxide. Brown does it and so does Fedex.

The difference is in the US there's nothing they can do to increase their name recognition.

There isn't anyone in the country who doesn't know who the post office is. What the post office needs/needed was to advertise in a way to show that people should ship packages with them rather then UPS/Fedex/whoever.

A cycling team doesn't accomplish that well. It can get your name out there... but the post office doesn't need that.

It would have made much more sense for Fed Ex to do it. People see a mailman every day... do you really need to see a cycling team on TV in europe to "spread the word" about the post office?
 
May 23, 2010
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kurtinsc said:
The difference is in the US there's nothing they can do to increase their name recognition.

There isn't anyone in the country who doesn't know who the post office is. What the post office needs/needed was to advertise in a way to show that people should ship packages with them rather then UPS/Fedex/whoever.

A cycling team doesn't accomplish that well. It can get your name out there... but the post office doesn't need that.

It would have made much more sense for Fed Ex to do it. People see a mailman every day... do you really need to see a cycling team on TV in europe to "spread the word" about the post office?

Well umm...conversely ...exposure in the american media couldn't possibly mean anything for quickstep, saxo rabo caisse cofidas, astana, ...well almost all of them. How much of a premium are these sponsors paying to penetrate a market they have no presence in? I guess if I am ever in Denmark and need to use an ATM machine I might go to saxobank but really. The real loser is Radio Shack..What were they thinking?
 
Jun 28, 2009
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kurtinsc said:
The difference is in the US there's nothing they can do to increase their name recognition.

There isn't anyone in the country who doesn't know who the post office is. What the post office needs/needed was to advertise in a way to show that people should ship packages with them rather then UPS/Fedex/whoever.

A cycling team doesn't accomplish that well. It can get your name out there... but the post office doesn't need that.

It would have made much more sense for Fed Ex to do it. People see a mailman every day... do you really need to see a cycling team on TV in europe to "spread the word" about the post office?

I have to agree with you. Here in the US, who doesn't know who the USPS is. And what exactly did sponsoring a bicycle team accomplish? Now, in the world of business, sponsoring the winner of a major event multiple years in a row would certainly raise brand awareness with your company name plastered all over the place. But exactly how did it aid or promote the USPS? Go figure.
 
Jul 29, 2010
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Hmmmmm said:
exactly how did it aid or promote the USPS? Go figure.

I could be wrong, but my understanding is that USPS began its sponsorship b/c it was entering the market for express int'l. mail in the EUROPEAN market. It was intended to increase public awareness IN EUROPE -- that "USPS" is a company with a competing overseas express mail offering. It was never intended to increase mindshare or brand awareness in the US.

In that light, it seems a sensible and high-exposure expenditure of marketing dollars.

(Having said that, I hope Novitsky fries him.)
 
Jun 28, 2009
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redtreviso said:
Well umm...conversely ...exposure in the american media couldn't possibly mean anything for quickstep, saxo rabo caisse cofidas, astana, ...well almost all of them. How much of a premium are these sponsors paying to penetrate a market they have no presence in? I guess if I am ever in Denmark and need to use an ATM machine I might go to saxobank but really. The real loser is Radio Shack..What were they thinking?

All I can figure on the Radio Shack deal is that they wanted to cash in on some exposure from an out-of-retirement ex-tour winner. RS probably, like the rest of the brainwashed American arm chair cyclists/quarterbacks (please ignore if you don't fit into this category - you know if you do or not), actually thought or bought into the fact that he could win the TdF! Definitely gives them some exposure here in the US no matter what due to his overall ridiculous amount of not-even-news coverage.
 

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