APG Creative Strategy Awards - Royal Mail 'small business campaign' by AMV BBDO

campaignlive.co.uk, Tuesday, 08 September 2009 09:45AM

LONDON - How Royal Mail planned a campaign to move away from images of postmen to attract small business users.

APG Creative Strategy Awards - Royal Mail 'small business campaign' by AMV BBDO

APG Creative Strategy Awards - Royal Mail 'small business campaign' by AMV BBDO

Summary

Royal Mail is one of the UK’s great brands, but has recently faced huge challenges:

  • The introduction of competition, taking away 20% of the market
  • The growth of the internet breaking the link between economic growth and mail volumes.


Through analysis of the business, we were able to discover that the true value was in ‘fulfilment mail’ and the benefit of this to business was ‘growth’.

This helped us to our new positioning statement – growth solutions for better business and our aspiration to become a partner for business growth.

There are promising signs that we will achieve results to surpass our initial expectations.  The campaign has begun to work in three ways:

  • Bringing in direct sales leads worth £5m.
  • Making online a self-serve hub.  During the campaign, traffic to royal mail.com has increased by 50%.  The Grow microsite has had 218,243 unique visits.  12,898 growth prints have been completed on the microsite.
  • Dramatically shifting perceptions.  Brand appeal has moved from 38% to 55%.


This is a dramatic case of brand revitalisation in a tough market and giving Royal Mail a new meaning and new confidence.


Introduction

Close your eyes for a moment and think about Royal Mail.  What comes to mind?  The Queen’s head on a stamp?  A postman cycling through a Cotswold village?  Christmas cards?  You’ve just illustrated the problem of transforming the image of a national institution.

We often look into a brand’s history and attempt to reveal a long forgotten hidden truth (Levi’s) or attempt to re-kindle latent positive memories (M&S).  We rarely think up an entirely new benefit, never before articulated in the brand’s history, moving it wholesale from one category to another. 

But just a few times we do. 

And every so often we succeed.

This is the story of one of those occasions.

A little bit of history

The national postal service was founded in 1635 by Charles I, laying the foundations of what became the universal service obligation (USO) carried forward by Royal Mail to this day. 

The national postal service became established as The Post Office, running both a delivery operation and a national retail network.  The organisation was so important that during the 1930s the Postmaster General sat in Cabinet as a Secretary of State. 

The Post Office then created and ran the national telephone network, its size and influence growing unbroken until the 1980s.

British Telecom was created in 1984, by splitting the old Post Office in half.  In 2001, the postal business became a plc with the government holding all the shares. 

In 2002, the organisation officially became known as Royal Mail Group.  This is composed of two separate organisations – Royal Mail, responsible for delivering the nation’s post and The Post Office, responsible for running a retail network. 

The two entities are often confused (even by financial journalists and marketing professionals), this paper is concerned solely with Royal Mail, not the Post Office.

The rise of the business customer

Royal Mail was still the organisation that delivered the birthday card to your granny, but this was becoming a much less important part of the business than before.  The market was now dominated by business customers – a much more demanding and less sentimental audience than middle-England. 

We tried to please both hard nosed businessman and stamp buying granny.


A disappearing market

In 2006 Royal Mail faced a problem that was somewhat unique to the ex-nationalised industries – a significant proportion of their market was legislated away. 

The postal market was fully liberalised on January 1st 2006.  For a few years prior to this, private companies had been granted postal licences, but now all aspects of Royal Mail’s business were subject to price competition. 

Private competitors, primarily TNT (the Dutch national postage service) and UK Mail picked off the biggest bulk mail customers (big banks, utilities and telecoms companies) by offering them discounts.  Royal Mail was not permitted to compete on price and 20% of the market was lost.

It is easy for private sector marketing professionals to mock Royal Mail, but few would enjoy being subject to new and fierce competition without the ability to change prices to defend yourself.  And then, another structural change.

Mail volumes had, for a number of years tracked economic growth, rising and falling with economic activity.

But, in 2006, mail volumes actually declined whilst economic growth reached a ten year high. What had broken the relationship?

E-substitution meant communication previously carried by Royal Mail moved online.


Facing the challenges

It looks naïve in retrospect, but our attempts to win back hearts and minds began with brand advertising designed to remind everyone of the good things about Royal Mail. 

In devising the campaign, we sought to reinforce unique associations – primarily the postie.  Two campaigns used this asset to build emotional preference.

The first campaign (With us it’s personal) ran in 2004 and the second (Letterboxes) ran in 2006.  Despite initially positive reactions, both campaigns were flawed:

  • Showing postmen traps us in the past.  The postman is a powerful emotional trigger for much of what it means to be British, but we were up against competitor imagery of airplanes and motorbikes – an image of speedy efficiency that was much more 21st Century.
  • We were inadvertently selling our competitors’ service.  Although the postman creates emotional engagement, the terms of the USO meant that post from all competitors was delivered by Royal Mail postmen.  Indeed, part of their sales pitch to business customers was essentially ‘the bit of Royal Mail you want without all the bits you don’t’.  They could offer much cheaper collection and sorting and still access the trusted friendly postman to put it through the letterbox.


The advertising showed that our hearts were in social mail.  Even when we thought we were being a business brand, we showed the household recipient of the mail, kidding ourselves that this was a universal benefit that would work to hold on to our social mail heritage and delight business customers. 

Of course it didn’t work.

Being a true business brand

Asking customers what they wanted from Royal Mail was a trap – even business customers serve up polished memories, as though attempting to recapture their own past by willing us to reinvent the postman.

So, instead of looking out, we started looking in, interviewing people across the organisation to understand what Royal Mail was actually doing, rather than what our customers wanted us to do. 

First we found some barriers.

The shift in business from social mail to business mail was only partly accepted internally.  Many in Royal Mail felt passionately that their customers were the households to whom they delivered letters and parcels, not the businesses that paid for the deliveries.  Only 14% of mail volumes were generated by households, 86% were generated by businesses.

Royal Mail had spent the years following liberalisation attempting to retain letter volume.  Because of the historical mission of the organisation, defending mail was the main activity.  But this was almost impossible, due to the pricing constraints and structural changes already mentioned.

Then, we found some numbers to build a business brand with.

The value in the market was not in letters, it was in ‘fulfilment mail’ – the delivery of goods or services ordered from businesses.  Whilst letters accounted for a massive proportion of volume, much of the value lay elsewhere.  Almost half the value of Royal Mail was in fulfilment mail.

The growth was not in letters, it was in ‘fulfilment mail’

Whilst social mail and transactional mail were in decline, fulfilment mail was growing at 15% a year.

Our old values would not take us to this new world and there were still challenges to overcome, mainly our inability to compete on price. 

We decided to shift the terms of the debate with our business customers from how much working with Royal Mail cost, to how much it was worth.


In search of a new idea

We looked in detail at fulfilment mail to understand its role for businesses.

Through fulfilment mail, businesses could delight existing customers through timely and cost effective delivery of orders and manage and control costs by taking advantage of Royal Mail’s advice on which products to use.  These benefits enabled efficient running of business, but they were also delivering a higher benefit.

By helping businesses reach new and existing customers, Royal Mail was a partner in the core effort of any business.

To grow

At this point, we looked at Royal Mail’s products and services through a ‘grow’ lens.  The other part of Royal Mail that was in good health was delivering growth to business too, by helping businesses find new customers through mail as an advertising medium. 

We had identified a potential new benefit area in ‘growth’, but we needed a new way to deliver it.  Our previous campaigns had placed us between the business and their customers, in our attempt to own the letterbox and the household recipient.  But this was fuelling some of the resentment towards Royal Mail and obscuring the value equation.  We were positioned as a supplier at the end of the value chain.

The opportunity was for us to be a partner, not a supplier, looking for products and services to stand behind our business customers and support their success.  A new role and the opportunity for a new dialogue.

Selling a benefit is far more efficient than selling individual products.  Any individual product had always struggled to deliver significant ROI through communication campaigns because few had broad enough appeal to justify mass mailings or advertising.  So we tended to turn out one small product campaign after another.  By selling the broader benefit of business growth, we opened the door to customer self service online.

Our new positioning statement emerged – growth solutions for better business and our aspiration to become a partner for business growth.

Bringing grow to life


We created a new visual language, fusing business imagery with organic shapes.

Communication would illustrate or explain how Royal Mail had helped business customers to grow.  Then they were encouraged to visit a microsite hosted on Royal Mail.com where they could answer a series of questions and generate a growth print – a bespoke solution with Royal Mail product recommendations to help with the particular needs of their business.  A physical copy of this prescription for growth was then mailed to them.

The idea was executed across a wide range of media – TV would dramatise the proposition, stimulate SME interest in Royal Mail as well as reaching Royal Mail colleagues.  Business areas online, in press and on mobile would build a dialogue with them, proving how Royal Mail’s products and services can make business more effective, with real case studies of how Royal Mail has helped other companies to grow, inspiring them to come to royalmail.com to find out more.  Magazines were used to bring the message to our postal colleagues internally and business customers externally.


An effective campaign


We expect the grow campaign to run for many years, so this is an early read on initial effectiveness, but there are promising signs that we will achieve results to surpass our initial expectations.  The campaign has begun to work in three ways:

Bringing in direct sales leads.  The campaign has currently generated direct sales leads worth over £5m, from a marketing investment of around £3m to date.

Making online a self-serve hub.  During the campaign, traffic to royal mail.com increased by 50%.  The Grow microsite has had 218,243 unique visits.  More than 50,000 growth prints have been completed on the microsite.  Although this seems small compared with broader scale consumer campaigns like Walkers search for new flavours, it is worth remembering that the Royal Mail business audience is much smaller and that creating a growth print is a significant level of interaction and commitment.
 
Dramatically shifting perceptions.  Our challenge had been to make Royal Mail a true business services brand and show renewal from the letters business of old.  We have seen significant increases in many measures, even in these early days of the campaign. 

  • New information            + 27 percentage points
  • Brand appeal                + 17 pp
  • Spontaneous awareness        + 17 pp
  • Better than other suppliers        + 11 pp


Bringing internal colleagues with us.  In internal surveys, 70% agreed that the campaign showed that Royal Mail is trying to modernise.

A revitalised brand

Changing famous and established brands is one of the toughest communication challenges.  It’s easy to change advertising campaigns, but very hard to shift brand meaning.  You can often only achieve this by ignoring what people want you to say and instead peeling back the layers of the organisation to find out where the true value lies.

And then you can grow.


Royal Mail brand brief

Get…   Small businesses

To…    Think about Royal Mail as a partner for growth

By…    Demonstrating how Royal Mail can help growing businesses:

  1. Engaging them with stories about growing businesses that use Royal Mail services to support their growth
  2. Telling them how specific Royal Mail products and services can help businesses grow
  3. Offering them Royal Mail sponsored resources to help them discover how to grow (e.g. online mentoring sites where businesses can share tips on achieving growth; educational resources on better business; awards for Britain’s fastest growing business)


Helpful stuff

Royal Mail needs to move beyond the world of delivery to achieve revenue growth.  Of course we need to reassure people that we can deliver the post, but this is not likely to cause them to behave differently or send more through the post. 

With big business, competition is an issue, but amongst small businesses, TNT, DHL etc. won’t be interested in their business.  So we’re not trying to convince them to use Royal Mail vs. competitors, we’re trying to get them to use mail differently.  Royal Mail’s business will grow by:

  1. Persuading businesses to do things through the mail that they didn’t used to do at all, or used to do in other media – primarily marketing.
  2. Persuading businesses to use Royal Mail for things they used to do in other ways, e.g. Special Delivery to courier products to customers.
  3. Helping businesses that work with Royal Mail to grow, thus increasing the volume of economic activity they conduct through us.


We need to explore how Royal Mail can begin to own the territory of ‘growth’. Specific services will emerge over the next few years that offer consultancy about directly driving growth, but we need to lay the foundations now, by owning the territory for the brand.  This is likely to involve all media.  Budgets are not available at this stage and may be driven by the idea, to an extent, although there is unlikely to be significant ongoing TV spend.

We need to think about how this area is expressed visually, creating a template for ‘growth’ communications, working within Royal Mail’s existing corporate look and feel.

Our first live executions will be for Special Delivery, so in addition to finding a creative idea to communicate ‘growth’ overall, we need print and radio to support Special Delivery in August.

We will be researching ideas and hope to get a range of approaches to allow us to explore this creatively with Royal Mail customers.

Proximity are also working to this brief and ideas from AMV and Proximity will be presented to Royal Mail and subsequently be researched alongside one another.

 
Craig Mawdsley AMV BBDO
Adrian Hoole, Proximity
Nick Keppel-Palmer, Wolff Olins
Tania Harwood, OMD

This article was first published on campaignlive.co.uk

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