Principles of Postal Address Quality

Organizational address quality has been a topic of discussion for decades. Poor address quality leads to significant expense for both the USPS and the mailing industry. Reduction of Undeliverable as Addressed (UAA) mail is a significant contributor to effective mail performance/results. Making improvements to your customer information and fulfillment procedures benefits all organizations. Here are some great principles1 I found while preparing for my upcoming CMDSS certification exam through MSMA.

Escalation Principle

This principle states: The farther the customer or prospect transaction progresses, the more expensive it becomes to correct the address information.  Generally there are three points where businesses can attempt to correct address information. In ascending cost order they are:  At origin, once it is in the system and address correction once the collateral has been sent is an option. The premise is that with each event in the transaction process, the more dispersed, replicated, and unpredictable the address information becomes.

This principle does not consider the residual effects of shipping to an incorrect address or mailing a brochure that never reaches its recipient. It simply focuses on the time, resources and simple “hassle” of ensuring a customer’s information is valid throughout the organization and when address information is best corrected.

Hard Dollar Discount Principle

The USPS offers substantial discounts to organizations that prepare mailings that facilitate automation through their handling processes. The majority of these “work sharing” incentives require address standardization.
The Hard Dollar Discount Principle states: Address correction is a necessary first step for taking advantage of most postal discount programs.

Postal discounts are “real green dollar” savings to an organization. They enable you to pay the USPS less to mail your mail pieces. Customer goodwill, value to the organization and better delivery are important, however the numbers associated with these are more difficult to measure than pure postal discounts.

Correcting and standardizing address lists and presorting them with a USPS CASS and GOLD PAVE certified product will result in a lower postage bill. Increasing postal rates are a part of our business, so every opportunity we get to save money and drive our postal cost per piece down must be realized.

Large mailers have long enjoyed the benefits of postal discounts. Given the current rate environment, it is imperative that organizations of all sizes utilize this form of cost containment. Address correction technology is affordable, easy to use and enables your organization to take advantage of these postal discounts.

The Hunter Principle

We are on a constant quest for increases in sales, membership or participation from our current and target customers. We seek information prior to selling, signing-up or whatever the activity we use to accomplish the goals of the organization.

The Hunter Principle states: Captured information has some value in its original state. It has far more value in a processed state.

Whether we are speaking of actual game in the wild or address data the principle holds true. The postal address information captured from your website has some value. However, the address may or may not be correct and the missing or incorrect address elements “devalue” it.

The value and usefulness of address information is heightened when it is processed with USPS certified software. These products “cleanse” the data by correcting misspellings and standardizing address elements (Coding Accuracy Support System “CASS”). This fills in missing address components and can add relevant information like county name or congressional district and verifies the address to the delivery point. Data “hunting” is the first step in creating a responsive database. Address cleansing and standardization is the next.

The Unfulfilled Principle

This principle borrows from the Hunter Principle. It states: An organization’s ability to fulfill orders and other requests is directly related to address quality.

Using the web or direct mail to initiate orders or requests for information are fundamental marketing processes. Fulfilling those requests is equally fundamental. The requested items are selected, boxed, addressed, and shipped to their destination. It should be simple and for the most part it is. Problems arise when the address on the article is incorrect or incomplete.

Your customers order merchandise and get a promise of delivery. Improperly maintained address data throws a “wrench” into this process. Regardless of whose fault it was, the promise of delivery goes unfulfilled.  The customer is unhappy.
The merchandise gets returned to your organization which expends more resources to process the return and pay a return-shipping penalty. The organization is not happy.

Your organization risks losing the immediate sale and the lifetime value of the unhappy customer and is left really unhappy!
As marketers we are endlessly challenged with finding prospects and turning them into customers. Something as simple as an inaccurate, outdated postal addresses can undermine our work, our plans and our success.

The Speed Principle

With the proliferation and popularity of overnight shipping, we seem to be of the mindset that all documents require immediate delivery.  I remember a time when this type of service was not widely available.

These delivery services are invaluable and nearly indispensable business tools in today’s world. The Speed Principle states: The speed that mail is delivered is directly dependent on the quality of the address. In short, if the address is incorrect or outdated, expect some type of delivery delay. The USPS estimates that nearly 24 percent of all addresses in the mail stream have inaccuracies. The speed and accuracy of the delivery of this mail is proportional to the extent of the inaccuracies.

USPS certified address correction software will resolve many address problems and standardize the content. If the person or company you are mailing to has moved, you may also submit the list for NCOA (National Change of Address) processing. NCOA processing will update those records in your database for moves that have occurred over a period of your choosing.

These software tools can reside on your desktop computer or in the SaaS environment waiting for you to submit an address file or record for processing. The addresses are matched against the USPS’ file of all deliverable address ranges and validation is completed. Utilizing address correction software internally is a very convenient method for ensuring address quality.

The Precision Principle

The Precision and Speed principles fit together perfectly. Corrected address information moves mail through the USPS’ processes faster because they do not have to “guess” about the delivery point. The Precision Principle states: The accuracy of mail delivery is directly dependent on the quality and completeness of the address.

Examples of corrected addresses receiving more precise delivery are everywhere. Large apartment complexes and high-rise office buildings come to mind. A building might have a “default” address for the building, however the “delivery point” is that address plus the correctly appended apartment or suite number. Mailing to a prospect or customer without this additional information is not recommended and most often results in failed delivery. A beautiful mail piece with a great offer is useless if it fails to reach the recipient.

Address correction software provides the opportunity to look further into the address record and see if secondary address information such as suite or apartment number exists. Remember, the USPS’ file only lists deliverable addresses, not who lives there. Therefore, the specific apartment number that matches your prospect must be confirmed before appending the address record.

Delivery Point Validation (DPV) is another feature of the CASS process. It goes beyond standardizing an address to a known address range and can standardize down to the primary delivery address. Speed is important but precision is critical.

The Duplication Principle

Have you ever received more than one of the same mail piece from an organization? What if that organization was yours? The Duplication Principle states: Duplicate address detection success is dependent on the degree of address standardization. Just as mailing list quality fluctuates, address standardization will affect duplicate detection.

Duplicate mailing remains one of the most visible problems in direct mail communication. Customers and prospects are irritated by it, mailing organizations waste resources processing it and marketing efforts are hindered by it.
Duplicate address detection software is readily available for organizations to virtually eliminate this as an issue. Duplicate detection or “matching” software looks for patterns and phonetic similarity between addresses, personal names, and business names within and between your databases.

When the matching software completes its investigation of your databases, the suspected duplicates are presented. The disposition of these records is up to you.  In some cases you will allow the software to automatically dispose of these records depending on applicable laws and existing internal business rules and processes.

The easier it is for matching software to find duplicated records, the greater your success in eliminating them. An essential first step is standardizing and correcting the data as detailed above. If the address elements of duplicated records are standardized, matching software has a better chance of detection.  Once it is confirmed that the address records are identical the disposition of the “duplicate” is in your control as the list administrator. In most cases, you simply delete one of the records and move on.

In doing so, one unit of postage was saved, one unit of printing was saved and more difficult to calculate and quantify customer irritation is avoided. Multiply these benefits over the expanse of your lists and databases and the savings can be astounding.

The Foundation Principle

As its name depicts, this principle speaks to the base fundamentals of an organization. It states: Verifying and validating customer data is a fundamental business practice that impacts communication throughout the organization. A customer mailing list remains a key conduit for retaining loyalty, interest, and continued business. A correct address is foundational to business retention.
There are many reasons businesses determine their inherent value over their lifetime. When a third party is involved in the valuation, business practices (or the lack of them) are considered.

A walk through by this third party would review how customer/contact address information is collected and immediately validated for best delivery of packages, direct mail and invoices. If the address could not be corrected by USPS CASS Certified software, the customer service agent prompts the caller for additional information. The organization has demonstrated a uniform business rule and a sound business practice.

This foundational business procedure is not limited to human-to-human contact. A visitor to your website is asked for address information among other data requests. CASS Certified address correction software integrated to your website standardizes the submitted address in real-time.

Accuracy of addresses should be viewed in a similar light as accuracy of accounting. Both practices directly impact not only the day-to-day operations of your business, but also its inherent value.

The Asset Principle

This principle states: An organization’s customer list is one of its most valuable assets. Address correction and validation increase that value.

To paraphrase, a company’s customer list is an extremely valuable asset, similar to specialized equipment or patents. Often companies are bought and sold on the basis of their customer list and little else. The value of this asset is diminished if lists are riddled with duplicates, outdated or missing address elements and misspellings.

This address data should be valued just like any “raw material” that goes into the “manufacturing” your organization’s product or service.

Without a correct address it becomes increasingly difficult to ship goods. It is also more challenging to cross-sell or up-sell using direct mail.
Address information is an enterprise resource and asset whose value crosses organizational units. There is interdependence across and between departments and functions for all of the elements required to complete a successful customer transaction. Clean, updated address information is an organizational asset that efficiently facilitates business.

The Standardization Principle

The Standardization Principle states: Standardization of postal address capture directly increases data quality. This speaks directly to the business rules and data definition you have set forth to acknowledge workers capturing address information.

The results any address correction software produces depend on the raw address information presented.  Garbage in, garbage out to use a popular phrase. An address record in which the city does not match the state and the state does not match the ZIP Code is probably not going to be accurately corrected. Customer service agents should be provided with training and an actual script of what to ask for and when to ask it.  Questions like:

• Is there an apartment or suite number?
• Is it Elm Street, Elm Avenue, or…?
• Is there a directional component (N, S, E, W, etc.) to this address?
• Do you have a mail stop?

Capturing address information at the source in a systematic, standardized method increases data quality and eliminates the cost associated with making corrections later. Defined processes for data collection increase the effectiveness of address correction software and other address enhancing processes.

All organizational address information should reside in a single repository and only be accessed/sourced from there for other processes such as shipping or direct mail. This provides the organization with a single source for the most accurate and updated address information as marketing plans, budgets and general business strategies are developed.

The Customer Service Principle

These principles all speak to the nearly incalculable effect poor address quality can have on businesses and organizations. The purpose of most businesses is to create and retain a customer. The importance of a correct and current address is directly relevant to this purpose. The Customer Service Principle states: A correct and updated address positively impacts the customer service experience.

The customer address is an important part of the business value chain.  This value chain should be viewed as a group of sequential activities initiated by a customer for their own purpose to satisfy some want or need. Failure to satisfy that want or need negatively impacts the business’ purpose to create and retain customers.

Conclusion

Postal address correction was once a process used primarily for taking advantage of postal discounts. Postal savings is still an important reason to implement effective data quality processes but not the only reason.

The benefits of standardized addresses has transcended the mail center and is a core organizational need. With the popularity of on-line retail and other transactions, small parcel shipping has exploded. Accurate delivery relies on an accurate address. Undelivered invoices because of erroneous address data impact cash flow.  I heard someone at the USPS put it this way: When was the last time you dialed the wrong number and reached the right person?

Think about this as you review the address data quality processes in your organization.

1Reference: msmanational.org - CMDSM/CMDSS Study Guide