Tag: Royal Mail

While the ecommerce sector rests on efficient delivery, customers are more interested in knowing when an order will arrive than getting it quickly, reports Sean Hargrave

Although some consumers may have been confused at the Post Office counter, the evidence is that the country’s etailers were ready for the Royal Mail’s Pricing in Proportion (PiP) scheme introduced last month.

PiP changed the way the Royal Mail charges for deliveries by considering an item’s size as well as its weight – hence the addition of a ‘large letter’ category for letters larger than the normal C5 business letter yet smaller and lighter than a parcel. In all, 80% of items carried by Royal Mail will either remain the same price or be cheaper, a spokesman predicts.

The Royal Mail’s optimistic vision that the scheme has been introduced without disruption has been mostly backed up by ecommerce sites. Online photo print service Photobox’s MD Mark Chapman, for example, says there was enough warning of changes to the pricing of the million packages it sends through Royal Mail each year and that the moves are sensible.

“We’d been consulting with Royal Mail for a year or so, so every major ecommerce provider would have known about the changes,” he says. “Overall, we reckon our post bill will come down. I think, though, for the next couple of months ecommerce players are going to be in flux as they wait for their bills from Royal Mail to confirm they’ve got the savings they were expecting. When we have confirmation we’ll be able to pass on the savings through our prices.”

Royal Mail is overhauling its interactive agency roster in a bid to improve its communication with customers. The new strategy follows an increase in competition from new postal service providers.

Proximity London was handed the bulk of the postal giant’s interactive work in 2003, but its three-year contract has now come to an end. It is not clear if the agency is intending to repitch for the business.

Omnicom-owned Proximity was appointed to replace Ogilvy Interactive following a pitch, and was given a brief to oversee the postal operator’s digital strategy, online advertising, e-marketing and a redesign of royalmail.com.

It recently launched its first foray into interactive TV as part of a #10m blitz to introduce “pricing in proportion”, which bases postage cost on size and shape as well as weight (MW July 6). But it is not clear if it plans to develop any further interactive services.

A spokeswoman for Royal Mail confirms the organisation is reviewing the business and plans to appoint a roster of agencies. She says: “We are looking for a number of agencies that will enable us to make the best use of digital media for our customers.”

Royal Mail has come under increasing pressure from new entrants, such as TNT Post, DHL Global Mail and UK Mail, after the deregulation of the sector at the beginning of the year.

Meanwhile, Royal Mail has announced a new roster of agencies to handle tactical design work across all of its internal and external communications. Home, Meteorite, Open Agency, Start Creative, True North and Rufus Leonard have all been appointed.

The Communication Workers Union has accepted a pay deal with Royal Mail, in which postal workers pay will rise by 3.9% this year and provide the opportunity for further deals in the future.

The deal means that the threat of industrial action is withdrawn, and the direct marketing industry escapes costly disruptions.

As part of the deal, the current cap on door-drops will be lifted, therefore protecting jobs and improving pay.

Ray Ellis, acting deputy-general secretary of CWU, said: “We have secured a platform that ensures the union is fully involved in shaping the future of our members. This includes moving forward on our pay ambition of catching, matching and overtaking average basic pay.

It also means that we are well positioned to deal with the change in the business in a way that ensures our ideas will be key to shaping our members’ future the way they want it to work.”

The agreement provides a 2.9% increase, guarantees a further 1% from efficiency savings and no compulsory redundancies. It also confirms the opportunity for further pay rises through efficiency savings.