Tag: Royal Mail

Opening up the UK market appears to have been positive for all concerned

Posted by | Dec 29, 2006 | |

One year after the introduction of full competition in the UK’s postal market, everyone appears to be a winner.

Customers are benefiting from record levels of service and big business mailers are enjoying substantial savings in costs.

Eighteen new postal operators have been licensed and have seized a bigger share of the market than the regulator expected, handling more than 10 per cent of the mail.

Royal Mail remains the dominant force in the industry despite losing its monopoly. Its competitors hand over most of the mail to the state-owned operator for final delivery, leaving it with 97 per cent of postal revenues.

Postcomm, the postal regulator, declares itself pleased with the progress made so far. “Royal Mail has really raised its game, especially on quality of service,” says Richard Moriarty, deputy chief executive. “And the competition has brought a range of new business models, with operators offering different ways of doing things, such as later collection times and guaranteed delivery.”

The state-owned operator is on course to meet all 12 of its performance targets for the first time in the 2006-07 year – these require it to deliver 93 per cent of first-class mail on the next working day and 98.5 per cent of second class mail by the third working day. Two years ago, only four of the targets were hit.

The greatest benefits have accrued to the biggest mail users, which include banks, utilities, local councils and charities. Businesses account for 87 per cent of the more than 20bn items sent each year, with 500 companies providing half of all mail volumes.

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‘The charmed generation’: UK businesses recognising a unique market worth GBP1 billion

Posted by | Dec 29, 2006 | |

UK businesses are waking up to the value of the Charmed Generation, a group of two million over 55 year olds with the highest disposable income of any other consumer age group, it was revealed today.

Research from Royal Mail and 20plus30 Consulting has estimated the net capital worth of the Charmed Generation is GBP1 billion – a level of wealth for over 55 year olds that will not be repeated in future generations.

Royal Mail statistics show that ‘The Charmed Generation’ has the highest response rate to direct mail (over 16 per cent) of any group of consumers. Forty two per cent of this age group have said that in the last six months a mailing enticed them to become a new customer of a company and 48 per cent said a mailing had encouraged them to buy from a company they already use, indicating high levels of brand loyalty.

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One year on from full liberalisation – UK customers and operators are rising to the challenges.

Posted by | Dec 28, 2006 | |

Postcomm has hailed the first year of full competition as a promising start but warned there are more challenging times ahead for postal operators.

Postcomm Chairman Nigel Stapleton said:

“Full competition is off to an encouraging start in 2006 with 18 new operators now in the market. Many large mailers, both in the private and public sector, have switched to new operators who they have found to be reliable and sensitive to their specific needs. Everybody has benefited because, in response to competition, Royal Mail has delivered record service levels.

“Mail is a challenging market because it is being impacted by e-substitution and is price sensitive, particularly with direct mailers, who account for nearly a fifth of the market as they have other ways by which to promote their products and services. However, we believe there is more scope for all postal operators to introduce innovative products which will be valued by customers.

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Royal Mail eyes Sainsbury chairman

Posted by | Dec 24, 2006 | |

The chairman of J Sainsbury, Britain’s second-biggest food retailer, has been approached to become deputy chairman of Royal Mail, making him a potential successor to Allan Leighton as head of the postal group.
Philip Hampton is one of three candidates to have been shortlisted for the job and a series of interviews have taken place with the headhunter appointed to handle the search. Bob Wigley, chairman of Merrill Lynch Europe and a non-executive director of Royal Mail, has also been approached but it appears he is reluctant to take on the post.

Hampton is seen as a strong candidate. As well as chairing Sainsbury he also been finance director at Lloyds TSB and BT. Royal Mail is keen to find a deputy chairman who can be groomed to succeed Leighton when he steps down in March 2008.
However, the search has been made more difficult because none of the candidates wants to move forward until the government has decided whether it is going to back a financial restructuring at Royal Mail and support issuing 20% of its equity, which is 100% held by government, to staff.

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Christmas cards boost bottom line for UK businesses

Posted by | Dec 22, 2006 | |

Small and medium sized businesses up and down the country are set to increase their New Year profits by GBP257 million as a result of sending their customers Christmas Cards over the festive season.

According to the Royal Mail research launched today, bottom line profits of businesses are set to increase by 2.1 per cent as a result of sending Christmas card mailers – a return on investment of 3,213 per cent – with the average company spending just GBP200.

Businesses are realising the value of sending Christmas cards, with a third convinced they help to build and maintain customer relationships, and six in ten believing that they give them a competitive edge.

Alex Batchelor, Royal Mail’s Marketing Director, said: “This research shows that as a sales and marketing tool, the humble Christmas card provides a huge return on investment.

Royal Mail’s festive postbag this year of two billion items includes 750 million Christmas cards.

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