It's in there hiding, lulling mailers into a false sense of security that their mailpieces are truly being delivered. Dirty data, or what the U. S. Postal Service calls Undeliverable As Addressed (UAA) mail, costs the USPS $1.8 billion to process each year and amounts to nearly 10 billion pieces of mail that may never reach their intended recipients.
According to a recent USPS cost study, last year, 1.6 billion pieces of mail were returned, 1.985 billion pieces were forwarded and over 6 billion pieces were discarded. Somewhere in all those billions of discarded pieces may have been a mailer's next "best customer." Somewhere in those billions of forwarded pieces of mail may be current customers who recently moved or had their addresses converted by their local government, but the outdated addresses are still being used.
And it's not just the cost to the U.S. Postal Service that mailers should consider. According to the 2005 DMA Statistical Fact Book, postage accounts for 21% of the overall investment in the average mailpiece. There is also the printing (31%), creative (10%), artwork and preparation (9%), the mailing list (11%) as well as all of the other costs (18%) that are at stake with every piece of UAA mail.
Fortunately, there are tools to identify these addresses and take corrective action, including:
Collectively, these tools work in conjunction with CASS-Certified software to shine a bright light into your database, uncovering your dirty data and giving you the opportunity to cleanse it now before your next mailing.
Starting August 1, 2007, the USPS is focusing significant attention on reducing this UAA mail by requiring mailers to make an investment if they want to continue to achieve automation discounts on their mailings. This investment requires the addition of DPV and LACSLINK tools as a part of CASS-Certified software. However, many mailers are unfamiliar with these tools and the impact they will have on their customers' lists and may simply view this as a pure cost rather than an opportunity to improve the value of the services they provide.
Address Conversions from Municipalities
The LACSLINK Product is a database containing over 5.5 million address conversions introduced by municipalities. These are primarily address conversions that result when an emergency response system (such as 9-1-1) is implemented and the rural route addresses need to be converted to a street-style format. It also contains conversions such as renaming or renumbering of existing city-style addresses, which is an ongoing process. Since the USPS will only honor delivery to the old-style address for one year, it is imperative that the address is updated to the new format to ensure continued delivery.
By offering LACSLINK processing as an additional address correction service, mailers are able to help their customers keep their data current. This improves customer relations and direct mail response rates and also facilitates additional address quality initiatives. Mailers will need the updated address if they want to make sure they are targeting the right customers across multiple lists.
Assuring a Delivery Point
The other requirement for CASS-Certified software in 2007 is the inclusion of DPV data. The DPV Product is an encrypted database containing the 165 million delivery points serviced by the USPS. This data is used to validate that an address is truly deliverable by the USPS. Effective August 1, 2007, a ZIP+4 code will no longer be assigned to a ZIP Code if the primary number of the address cannot be DPV confirmed as deliverable.
Here again is a key opportunity for mailers to assist their customers. DPV data will not only tell them if an address is deliverable, it will also provide crucial clues (in the form of footnote codes) indicating why an address cannot be DPV confirmed. For example, the DPV Product can indicate that an address is a match, but the secondary number (i.e., an apartment or suite number) was not provided. It can also indicate that the primary number is missing, invalid or that the address matched to a military address.
Keeping Up with Customers on the Move
While not required, but certainly a key part of keeping data current, is the NCOALINK product. NCOALINK provides change of address information that can be leveraged to update addresses before a mailing occurs, thus not only reducing UAA costs, but also ensuring delivery. With 41 million changes of addresses being filed every year, NCOALINK is a crucial component for fixing that dirty data.
Advertising authority Robert Coen predicts that in 2007, advertisers will spend $64.4 billion advertising through the mail stream, up 7.5% over 2006. With that type of predicted growth and investment, it is even more imperative that mailers keep their addresses complete, correct and current if they want to reap the true benefits of direct mail.
Armed with DPV-, LACSLINK-, NCOALINK-enabled knowledge, mailers can now offer address correction options for their customers in advance of the mailing and not only preserve postage automation discounts, but also provide an opportunity to increase mail response rates due to improved mail deliverability.
In part two of this three-part series on address quality, we will discuss the best practices for correcting addresses that cannot be cleansed using tools such as DPV, LACSLINK and NCOALINK. We will also discuss the latest proactive approach to preventing dirty data from entering your database.
Chris Lien is the Director of Commercial Mail Marketing for Business Objects. In his current role, he is responsible for setting the strategic direction of the company's Postalsoft brand of products. For more information, please visit the company's website at www.businessobjects.com.