“Urgent action” is needed for DM sector too

The avuncular Business Secretary Vince Cable uttered a rather stark warning last week: “Royal Mail is facing a combination of potentially lethal challenges – falling mail volumes, low investment, not enough efficiency and a dire pension position.”

A rather portentous tone for the nation’s favourite politician, and one prompted by a report by Richard Hooper, the former deputy chairman of broadcast regulator Ofcom, in the unimaginatively titled Hooper Report.

In said report, Hooper says “urgent action” is required to help the postal service modernise, address the mail group’s worsening financial situation and the unsustainable £10bn pension deficit.

How true.

In order to realise its commercial potential the Royal Mail needs an injection of private capital and it needs it yesterday.

The direct marketing, more specifically the direct mail sector, relies on a fit-for-purpose Royal Mail.

This matter of fact was illustrated last week when it was revealed that TNT Post and Royal Mail had been talking about how they can pool resources for the collective good of the direct mail sector.

The two are obviously rivals on one level, but as Lieneke Happel, marketing and customer services director of TNT Post, put it to me over a coffee recently, it can only grab so much custom from the Royal Mail, it needs the doughty campaigner in rude health to make sure it has an efficient delivery service for the addressed and unaddressed mail it relies on the Royal Mail to deliver.

The sector needs a nimble, cash capable Royal Mail to help drive mail innovation, data services and best manage the inevitable continuing decline in mail volumes by encouraging greater use of mail.

A private Royal Mail will accelerate the efficiency and modernisation drive already well under way and potentially lead to a more focused service for direct mail clients, business customers and the public.

And a truly competitive mail sector can only bring with it greater choice to direct marketers.

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