The new rates will mean a 500,000 piece campaign will cost around £3,000 less, according to postal services consultants Post-Switch.com.
However, the reduction has ramifications for competition in the broader postal industry, making it more difficult for rivals to make a profit when they are still buying Royal Mail services at unchanged wholesale rates.
The move is expected to cost Royal Mail £150m but will make its service cheaper than three of its big rivals that had previously undercut the product. Post-Switch.com said that TNT and UK Mail would have to review the prices of up to 400m mail items to stay in line.
"Royal Mail is using its market advantage to price competition out of the market, but it's difficult to justify these costs in light of Royal Mail’s balance sheet," Jonathan DeCarteret.
Royal Mail to reduce post costs for DM
Royal Mail has said it is to reduce its postal tariffs for its MailSort 3 service, used for posting direct mail campaigns, including its sustainability discounts, by 3% from 26 October.
