Why size-based pricing critics miss the point

Those industry stalwarts opposing size-based pricing are displaying a traditional knee-jerk reaction to any sort of change. They have somewhat missed the point.

Some form of size-based pricing is almost universal throughout Europe. At the moment, you could put together a European mailing campaign posted from the UK, with one pack sized 240mm x 165mm x 5mm, weighing up to 100g for the recipients on the Continent, and then another pack any size you fancy, but weighing under 60g for the Brits.

Royal Mail’s proposal is to base UK standards on the same size and weight as adhered to abroad, which makes a lot of sense if you take a European viewpoint. And the increase in weight up to 100g without the proportionate cost penalty is good news for catalogue mailers, who should welcome size-based pricing with open arms, even if they have to trim their catalogues down a little.

Less usefully, however, the rest of us have developed packs under 60g, and will now have to reduce the size of mailings to 240mm x 165mm. But, on the other hand, those of us already working under this size can stuff another 40g of brilliant creative into our packs and pay no more to mail them.

The sting in the tail, though, is that Royal Mail – which has based the whole idea on the supposition that it is cheaper to handle small packs than large ones – is planning no reduction for the smaller mailings still weighing 60g.

Having shrunk our cheap recruitment packs to help Crozier and Co recover a few quid, it seems very unfriendly not to reduce the price in exchange. This would, of course, have the knock-on effect of improving our return on investment, therefore increasing mailing volumes, giving Royal Mail even more money, and so helping everyone.

A reasonable trade-off, you might well think. And Postcomm, having our best interests at heart, will doubtless impose this modest enough condition on Royal Mail when it finally gives the go-ahead.