EDITORIAL: Royal Mail will 'tax' creative at its peril

The Royal Mail is not a happy place at the moment. Losses at its parent company, Consignia, soon to be rebadged with the Royal Mail brand, have increased the pressure on its consumer and business mail delivery service.

In recent years, Royal Mail has at least begun to act responsibly as a media owner, establishing closer links with advertisers and agencies and launching its Mail Media Centre to improve the reputation and reality of the direct mail medium. This relative warming of relations between Royal Mail and agencies is threatened, though, by the current stand-off over proposed price changes for business mail. Royal Mail intends to move to a system that charges by size and shape of mailings rather than weight.

"A tax on creativity, one creative director cried last week, upset at the possibility that unusually shaped or large format mailings will become a thing of the past as advertisers worry about spiralling costs. This would be a worst-case scenario and admittedly the proposal is at consultation stage with Royal Mail at least prepared to listen. But the motivations behind the proposed switch, that would undoubtedly inhibit creativity at direct marketing agencies, are indeed worrying.

Royal Mail is solely concerned with helping its parent company address losses of £1.5 million a day and must change its cost base accordingly.

It says that it costs more to deal with larger or unusually shaped mail, therefore it needs to increase revenue from such activity.

But this ignores the fact that the UK's advertisers are already a cash cow for an ailing monopoly. Their needs have been too often neglected by Royal Mail and in the past they have had no choice but to cough up.

In the next year this will change as competition enters the business mail market. Royal Mail's behaviour on the pricing issue will be closely monitored by agencies and advertisers as they decide where to place their spend.


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