We must work with Royal Mail – not fight it

Last week’s Precision Marketing was an issue of two views. On one hand Chris Gordon, in an almost conspiracy theorist manner, was continuing to labour the impression that Royal Mail/Consignia is potentially abusing its monopoly. Then, on the other, Peter De Haan talked absolute common sense about why Consignia should become more involved in the industry.

It is now more than six weeks since the Office of Fair Trading ruled in favour of Royal Mail’s involvement in the Postal Preference Service (PPS). WWAV Rapp Collins did everything it could to ensure a negative decision was reached – it lost. Even last week, it said: “We do not think that it was looked at by the regulator.” In other words, we will keep trying to cast doubt as to the validity of the service.

I completely agree there is a need for a level playing field – no advantage to Royal Mail as a result of its monopoly. The assumption is (and it is just an assumption) the regulator or Department of Trade & Industry would ensure this does not happen. However, the Government, as Consignia’s sole shareholder, has potentially removed about £400m of revenue. Are we really suggesting it should endeavour to recoup this without using its brand?

As Peter De Haan quite rightly points out, the growth of direct marketing over the last decade has become an irrevocable part of Royal Mail’s revenue – and almost certainly, the most profitable part of it.

Does anyone really believe it is therefore in its interest to destroy that income stream?

Adam Novak has made it abundantly clear that PPS was just ‘the first of many’. Mail Marketing, I am sure, is just another. Shouldn’t we therefore stop casting conspiratorial aspersions and create a dialogue of mutuality? I believe that if Royal Mail is abusive of its monopoly, it will be stopped. In the meantime, shouldn’t we strive to create an environment of mutual benefit alongside one of the industry’s largest players? Even if you don’t believe Royal Mail has reached that point, you should, because that is surely what it is set to become.

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PRECISION MARKETING, 27th July 2001