UK Royal Mail pricing plan angers direct marketing industry

Royal Mail has angered the direct marketing industry by asking postal regulator Postcomm to consider a proposal to price mail by size rather than weight.

Royal Mail claims that the method is an easier pricing system that more accurately reflects the costs of handling mail because it is the size and shape, not the weight, which determines the cost of processing and delivering most mail.

Many direct marketing companies believe that the proposals will be a handicap to the industry. A common claim is that the proposed charging system will stifle creativity, forcing the industry to move towards standard small packaging.

Carlson Marketing Group’s European development director John Shaw says: “The latest pricing proposals could once again see the direct marketing industry tarnished with accusations of junk mail. Direct mailings would become much more uniform and, by looking at the example of Germany, we would also see response rates fall dramatically.”

Forms of size-based pricing already exist across much of Europe and in the US. Royal Mail has carried out research to ensure these changes are as fair as possible for its customers and the changes are unlikely to be implemented until April 2005.

Black Cat managing director Stephen Callender supports the pricing proposals, adding that charging by weight has led to restriction in mailings rather than the other way around.