Second anniversary of the liberalisation of the UK postal market
28 December 2007
Postcomm, the independent postal services regulator, has found competition in its second year is starting to benefit more and more mail users, but has urged all operators to rise to the challenges posed by the digital age.
Research commissioned by Postcomm in 2007 found the benefits that large mailers have been experiencing since the market was opened have now started to slowly spread to smaller businesses. However, much more progress is needed and the challenge posed by the growing number of alternatives to mail confirms the need for mail operators to continue to pursue greater innovation.
The market research, which formed part of Postcomm’s annual Business Customer Survey, revealed that although Royal Mail remains the dominant operator, one in five small and medium mailers and more than a third of large mailers are using more than one mail provider.
Source: 2007 Competitive Market Review & Business Customer Survey summary document
One in five respondents have explored alternatives to mail and have moved some of their mail to other media in the past 12 months, this confirms the need for all postal operators to place more emphasis on customer service and innovation.
Source: 2007 Competitive Market Review & Business Customer Survey summary document
More than half of respondents agreed that competition has improved choice and more than a third believe competition has improved Royal Mail’s quality of service.
Source: 2007 Competitive Market Review & Business Customer Survey summary document
Postcomm’s annual Competitive Market Review (CMR), found that mail volumes were 2 per cent down on last year, but there are indications that direct mail is growing in sectors such as building societies, charity, and health.
Source: 2007 Competitive Market Review & Business Customer Survey summary document
End-to-end competition has declined by four million items and stands at less than one per cent of total mail volume, but mail volumes collected by ‘access’ operators and delivered by Royal Mail have more than doubled and now represent 19 per cent of revenue-derived mail volumes.
The research shows that a larger number of small businesses are beginning to benefit from competition, but much more needs to be done before small firms can experience the full benefits of competition that larger mailers have seen since the market was opened.
Awareness of the opportunities created by competition among all businesses is growing and many mailers are now using more than one provider. Indeed, Postcomm’s research found that businesses were overwhelmingly in favour of competition in the postal services market.
Source: 2007 Competitive Market Review & Business Customer Survey summary document
Postcomm has found there is plenty to be optimistic about, but the findings of the Business Customer Survey also reaffirmed the need for all mail operators to continue to innovate to meet the challenges raised by alternative media. Although respondents still value mail as a communications medium, more businesses have moved some of their mail to other media such as email during the past year.
Postcomm believes one key to the success of mail as a medium is to focus on getting more value into the product through innovation which can enable the sender to generate more revenue or provide greater satisfaction for the recipient.
Useful links
- Delivering a postal service for customers – the story so far (pdf, 43KB). This leaflet illustrates how, as a result of competition and regulation, universal postal services throughout the UK are among the most affordable in Europe, are more secure, reliable and innovative – and are provided to an increasing number of addresses.
- Competition through access agreements (pdf, 35KB). This leaflet provides background on how ‘access’ competition works and how it is benefitting mail users.
- About the mail market. This part of the website is full of background information and important facts about the mail market.
- 2007 Competitive Market review & Business Customer Survey summary document (pdf, 164KB).