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Oct 1, 2007 12:00 AM
Undeliverable As Addressed (UAA) mail is a billion-dollar problem for commercial mailers — including those in the printing business who provide mailing and fulfillment services to their clients. It costs the United States Postal Service (USPS) more than $1.8 billion each year to forward, return or, in many cases, dispose of this well intentioned but poorly addressed mail. In fact, a recent study done by the USPS revealed that over six billion pieces of mail are disposed of every year due to address quality errors. Of course, this is just the cost to the USPS.
According to the 2006 “DMA Statistical Fact Book,” postage accounts for, on average, 24 percent of the overall costs of producing a direct mail piece. If the address is wrong, depending on the class of mail, the entire piece could be lost. In other words, it doesn't matter how great the offer is, the quality of the paper, or the amazing artwork — if the address is wrong, nothing else about the mail piece matters.
Since August 1, 2007, the USPS has gotten tough on reducing 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.
The LACSLink product is a database containing more than 5.5 million address conversions introduced by municipalities. Primarily, these are address conversions that result when an emergency response system (such as 911) 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. Because 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 can help their customers keep their data current. This improves customer relations and direct mail response rates. It also facilitates additional address quality initiatives. You will need the updated address if you want to make sure you are targeting the right customer across multiple lists.
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. The USPS uses this data to validate that an address truly is deliverable. As of August 1, 2007, a ZIP + 4 code no longer is assigned to a ZIP Code if the primary number of the address (i.e., the house number) cannot be DPV confirmed as deliverable.
Here again is a key opportunity for mailers to assist their customers. DPV data will not only tell you if an address is deliverable — it will provide crucial clues (in the form of footnote codes) indicating why an address cannot be DPV confirmed. For example, the DPV product can tell you an address is a match, but you did not provide the secondary number (i.e., an apartment or suite number). It also can tell you the primary number is missing or invalid, or the address matched to a military address.
Looking ahead to future CASS cycles, the USPS has stated it will continue its aggressive approach to vanquishing costly UAA mail. CASS cycle N, which goes into effect August 1, 2009, will require the new SuiteLink product. SuiteLink can validate and correct business secondary address information. This is a significant opportunity to improve address quality for business mailings.
Consider a business that is located in a high-rise office complex. If the secondary address (the suite number) is wrong or missing, the mail piece might end up being deemed UAA and require the personal knowledge of the USPS letter carrier for ultimate delivery. It might simply be left in the lobby of the office complex or, depending on the class of mail, thrown out. However, armed with SuiteLink, mailers can correct or add the suite number for the business before the piece is mailed.
The USPS has announced its intention to expand the “move update” rules for First Class Mail and Standard Mail. Currently, only First Class Mail must use a USPS-approved move update method every 185 days on address lists to qualify for postage automation discounts. Under the new proposal, both First Class and Standard Mail must now have a USPS-approved move update method applied every 95 days. This doubles the amount of time for First Class mail and represents a significant change for Standard mail. Fortunately, the USPS is providing an 18-month transition window.
Keeping up with customers on the move is a worthwhile effort for mailers. Every year, more than 41 million changes of address are filed with the USPS. This amounts to roughly 15 percent of the entire population of the United States, ranging from individuals and families to businesses. During the peak move seasons, change-of-address processing can reach nearly one million per week. Having a current address earns the possibility of postage automation discounts, and it also aids in timely and predictable delivery.
There are a number of options for mailers to comply with this proposed move update change. They include premailing solutions, such as leveraging NCOALink, as well as post-mailing solutions such as ancillary endorsements, FASTforward for Multiline Optical Character Readers (MLOCRs), and the ACS Service, which now includes the opportunity to leverage the new Intelligent Mail Barcode (IMB) as part of the OneCodeACS service.
OneCodeACS in particular presents a very attractive offer for First Class mailers: It's free. The first two ACS updates for a given address are free and subsequent notices for the same address cost five cents. For Standard mailers, the incentive is nearly as attractive. The first two updates cost two cents; 15 cents thereafter.
As attractive as OneCodeACS is, it still isn't as effective at reducing UAA costs as updating the address prior to mailing. NCOALink still remains the most effective way to keep addresses current prior to mailing. By leveraging the 18 or 48 months of change-of-address data, mailers can update their own list or process lists for their customers.
The USPS provides two ways for mailers to offer NCOALink processing services for their customers. The first is the Limited Service Provider level. The USPS provides 18 months of change-of-address data directly to the a certified Limited Service Provider, who can then choose to update its own mailing list or its customer's list. In many instances, the move update processing can be implemented as part of a single-pass address quality solution, ensuring a complete, correct and current list. The price for the 18-month Limited Service Provider data is $15,000, which does not include the additional cost of the software to leverage the data.
The Full Service Provider level, at $175,000 per year, allows service providers to offer 48 months of change-of-address processing for their customers. This level is only available to companies that process 51 percent or more of lists for customers, rather than their own internal lists.
There are well over 300 NCOALink technology licensed users, including End User Mailers who leverage 18 months of change-of-address data for their own internal lists. This is important to know, because mailers can choose to select a licensed service provider for processing address lists as an approved move update compliance method, as opposed to licensing the data directly.
Armed with powerful address quality solutions such as DPV, LACSLink, SuiteLink and NCOALink, mailers now can offer address correction options for their customers in advance of the mailing. This preserves postage automation discounts, and it also provides an opportunity to increase mail response rates due to improved mail deliverability.
Christopher Lien is director of commercial mail marketing for Business Objects (La Crosse, WI). Contact him at email@example.com.
The CASS system enables the USPS to evaluate the accuracy of address-matching software programs. CASS testing ensures certified software packages achieve a certain percentage of compliance.
An encrypted database containing the 165 million delivery points serviced by the USPS. The USPS uses this data to validate that an address truly is deliverable.
A system that utilizes USPS proprietary technology to enable Multi-Line Optical Character Readers (MLOCRs) and supplemental Remote Video Encoding (RVE) operations to forward mailpieces in a real-time environment. It uses the interpreted name and address from the mailpiece, as well as the correct ZIP+4 code, to determine if a forwarding order exists for the addressee.
A database containing more than 5.5 million address conversions introduced by municipalities on an ongoing basis.
The National Change of Address Linkage System matches names and addresses on a mailing list to changes of address filed with the USPS by relocating postal customers.
Mailers use a barcode to access the electronic Address Change Service, to to identify and track the delivery of mail. This includes rerouting and updates for address changes on file in the NCOA list.
Processing that validates and adds secondary information (i.e., suite number) to business addresses.