Royal Mail boosts ecommerce gains with timed delivery

royal mail 1 (2)Royal Mail is aiming to build on the huge gains it has made in the online shopping delivery market by launching a new three-tier system, which will enable customers to send and receive parcels on specific days and times.

In a video message to its 140,000 staff, seen by The Mail on Sunday, chief commercial officer Nick Landon said the company is stripping back its current range of services and is in the early stages of developing new options for customers.

He said: “Longer term, we’re looking at what customers actually need and how we can reflect that in our products. And we want a three-tier product portfolio because three is a magic number. People always like to choose from three.”

Describing the three tiers as “good, better and best”, Landon said: “We’re looking at a ‘good’ product, the base product, and this will be built around [the idea of]: ‘I’ll leave it to Royal Mail to choose how it comes to me’.”

Landon continued that customers will be able to select the day they want the parcel delivered, with those who select the “best” product being able to choose a time slot for the delivery as well as the day.

All new products have to be approved by regulator Ofcom.

The move follows last month’s 2020-21 results which showed the postal operator had significantly different revenue outcomes between the two halves of the year. Parcel revenue growth was about 10% higher in the second half than it was in the first, while letters revenue declined only 5% in the second half of the year, compared with over 20% in the first half.

The company said that it may be some time before the true impact of the pandemic on the top-line is known, although it acknowledged that the crisis will have accelerated the long-term structural shifts in both parcel volume growth and letter volume decline.

Late last year, Royal Mail launched the Parcel Collect service which enables customers to get posties to pick up parcels from their homes, for a fee. At the time, the company claimed it was “one of the biggest changes to the daily delivery since the launch of the post box in 1852”.

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