The Nation is not a commonplace reference for marketers, but late last year it ran an interesting story about future of Inited States PostL Service (USPS).
The piece was inspired by a drama that played out last Christmas and featured an epic cast of characters.
Two of them, Jeff Bezos and Donald Trump, have moved on to more interesting plot lines. The third was another unlikely character in a direct marketing context, Sen. Bernie Sanders.
Trump played the protagonist. As is well known in light of recent events, he is no fan of Jeff Bezos, who placed himself in The Donald’s crosshairs as a result of his stewardship of the Washington Post, a pillar of what Trump pejoratively labels the mainstream media.
The President argues that the USPS is being exploited by Amazon, and should charge them more for shipping to help resolve its financial challenges. This is arguable except for the part where Amazon decides to insource delivery down to the last mile.
There are also elements within the Administration that want to privatize the USPS. Other countries have done so. Royal Mail is the textbook precedent.
Enter The Bern, who advocates postal reforms that would enable the Service to be more competitive.
Sen. Sanders told me something I didn’t know: the USPS once offered banking services, which is still in vogue overseas. Japan is the poster child of postal banks. Given the challenges of the unbanked, this is an interesting idea.
Fat chance, though. The powerful financial lobby would render such a proposal dead on arrival regardless of its merits.
In my humble opinion, Trump has a point. Package delivery is one of the few viable businesses the USPS has. They have pricing power. Their rates are far lower than FedEx and UPS, which is why Amazon uses them, and they’re even lower for AMZN because of the volume discount they negotiated.
Such special deals for top market cap companies are under attack these days, as evidenced by the demise of HQ2 in Long Island City, NY, so now would be a great time to lay a price increase on Mr. Bezos.
It’s also a rare bipartisan alignment between the oddest of couples: Bernie and Don.
Another fat chance is postal privatization. While it is extremely hard to argue that if the USPS ceased to exist we would need to recreate it, the political reality is that it’s a sacred cow especially in both little states that dominate the Senate and the big blue ones that rule the House. A blue House beholden to unions would never in a million years privatize it.
Deregulation is perhaps more doable with The Bern providing cover on the left flank. Few people really know or care about the intricacies of packaging delivery pricing, and it can be populized as a way to stick it to the behemoth Bezos.
That could be a good thing. USPS has for many years been a business-to-business proposition. It should be freed from the shackles of the Congress and its bureaucratic watchdog (the Kafkaesque Postal Rate Commission).
Bernie also has a point about the crippling pension prefunding mandate the Bush administration imposed on it. Without that, says USPS, it would be profitable absent any other reforms.
The bottom line is marketers can anticipate that there will always be a USPS as far as the forecasting eye can see. The service offers a lot of help to marketers who want to use it to best advantage.