UK Royal Mail under fire for 'greedy' D2D plan
Royal Mail’s recent agreement with postal workers to increase the number of unaddressed items they deliver has sparked accusations of “greed” and fears that response rates will plummet.
The deal, which has seen posties secure a 3.9 per cent wage increase, has been hailed by chief executive Adam Crozier: “Our customers will see greater capacity where they need it. We’re getting on with tackling the competition – not each other.”
But Mark Young, managing director at The Leaflet Company, questions whether Royal Mail’s “greed for short-term profitability will eventually lead to the demise of one of its most successful products”.
He adds: “Is this just one more step to line Royal Mail’s pockets? There will be concerns about return on investment now that the householder could receive twice as many items. Surely overloading the postmen will lead to lower levels of delivery.
“Independent audit companies have shown delivery efficiency for Royal Mail to have decreased continuously year on year.”
Tim Rix, business director at TNT Post, maintains that, although he supports the changes, he does not want them to have an adverse effect on advertisers. “Generally, we’re supportive of this. But we don’t want to see response rates diluted,” he says.
“Increasing items will increase profit – but could see less consumer response. Also, is Royal Mail going to increase rates?
“It hasn’t yet issued the new rates for next year, but advertisers are planning their budgets now; they book door-drops as far as a year in advance.”
Young agrees it is unfair that clients have not been given adequate warning: “This has only been tested in a tiny area, with almost no advance notice.
“No data has been compiled from the responses. Presumably the only relevant data is that there will be an increase on Royal Mail’s bottomline.”
Meanwhile TNT Post, which is Royal Mail’s closest competitor, has signed a deal with Sainsbury’s to handle its customer direct mail. TNT will distribute mailings through its Premier service – a 48-hour package for pre-sorted mail – with Royal Mail carrying out the final sort and delivery.
A Sainsbury’s spokeswoman says: “Customer retention is vital in our business. Therefore, communication is a key part of our success.
“We chose TNT Post based on the range of mailing solutions it had to offer.”
