Skimp on list hygiene and you risk being penny-wise and pound-foolish
Within a year of standardizing and clearing its house file, Alaska Wild Berry Products enjoyed a 20% jump in response.
Most catalogers know they can cut costs and increase response by cleaning their lists. But they may not realize just how profitable list hygiene can be.
By eliminating duplicate names prior to his upcoming January 2001 mailing, Robert Willmes, president of Reno, NV-based Best Computer Supplies (BCS), reduced his house file mailing list 10% – from 62,000 names to a clean list of 56,000 buyers. At $1.35 per book in the mail, that represents a savings of $8,100. He then ran a merge/purge of his rented lists and his house file, coming up with approximately 35,000 duplicate records, or 15%-20% of the names he’d intended to rent.
And if he had run his house file through the USPS Address Element Correction service (AEC), to name just one hygiene tool, Willmes could probably have saved even more money. AEC software revises incomplete and incorrect computerized address files. Let’s say you have on file a Mr. Smith at 123 Maine St., Springfield, NY 10010. In the course of appending the proper ZIP+4 code to the address, the sophisticated AEC software would correct the street name from “Maine” to “Main.”
By using address correction software, “mailers can save approximately $2/M-$4/M,” says Mike Yapuncich, vice president of product development for Schaumburg, IL-based Experian Direct Tech. For a mailing of 10 million names, that could add up to $40,000.
That sort of savings, Yapuncich adds, pales in comparison to the benefits of running files against the National Change of Address (NCOA) database, which provides updated addresses. “Running NCOA will generally give you a 400% lift in response and sales,” he says. “NCOA is by far the hygiene product that can have the most impact on mailings.”
In one of his client’s test mailings, the half of the mailing that was run through NCOA made $3.85 in sales per catalog, whereas the non-NCOA names generated about $.60 a catalog.
The lift in sales per book results directly from more catalogs reaching their destination. As Richard Russell, owner of Accessible Data Services, a mail house and data processing firm in Eugene, OR, notes, “I’ve seen the post office throw out containers of mail with the wrong addresses.”
As for the cost of running NCOA, Yapuncich estimates it at $1/M-$3/M. “I see a lot of mailers trying to save money by updating with NCOA only quarterly, but they don’t realize that by the time they are done, the loss is huge. The net benefit to a cataloger from running NCOA monthly vs. quarterly is easily $10/M,” Yapuncich says.
In addition to conducting year-round internal deduping, food cataloger Harry and David runs NCOA on every list rental at the time of circulation processing, says director of marketing Mike Zodrow. At times, the Medford, OR-based mailer also uses the U.S. Postal Service’s postal endorsement service in which, for a fee, a postal carrier fills out a card anytime a catalog is undeliverable. Harry and David then incorporates that information back into its database.
Meeting standards Generally speaking, list hygiene involves removing duplicate records, and correcting and standardizing the remaining addresses. Before that can be done, though, the data must be aligned in the proper fields and should hew to USPS requirements – for instance, “street” should be spelled out rather than abbreviated.
“It’s a nightmare if the client doesn’t have the data fields properly aligned and an adequate length,” Russell says. “If there are only 30 characters for the street address, for example, the runover information may get pushed into the next field. In this case, it is impossible to sort the information without going in and aligning it.” Nonstandardized data can cost hundreds to thousands of dollars to clean, Russell says.
Peter Eden, president/owner of Anchorage, AK-based food gifts cataloger Alaska Wild Berry Products, one of Russell’s clients, says standardizing records and improving list hygiene was an important component of his 1999 catalog relaunch, which also featured a redesign, increased pages, and more than doubling of its circulation from approximately 55,000 copies mailed in 1998 to 170,000 in ’99. Cleaning up its records paid off: Response rates increased 20% between 1998 and 1999 and nearly as much between 1999 and 2000.
Although Alaska Wild Berry outsources its hygiene, many mailers do the bulk of their list cleaning inhouse, using sophisticated merge/purge software. For example, BCS uses Mail Order Manager (MOM) software by Dydacomp for each of its three annual catalog drops. The software enables Willmes to select names by name or address. “Since we sell to schools and school districts, we send a lot of catalogs to the same address, so we chose to dedupe by name only.” Willmes also eliminates any names that have not been active in the past 24 months from the mailing list and people who have asked to be placed in the catalog’s “do not mail” file. The system costs $15,000-$20,000.
“There isn’t a catalog out there that can afford not to do list hygiene,” Willmes says. “Not long ago we could throw darts and succeed. Now, increased costs and everything else have raised the bar.”
A Glossary of List Hygiene Terms AEC: Address Element Correction, U.S. Postal Service software that revises incomplete or incorrect address records.
CASS: Coding Accuracy Support System, software that adds the expanded ZIP-4 code to an existing address record.
DSF: Delivery Sequence File, mail that the cataloger arranges in delivery order for a particular carrier route. Mailers can use DSF to identify questionable addresses.
LACS: Locatable Address Collection Service, a U.S. Postal Service database, available through licensees, that provides the official addresses of buildings that had formerly been designated only by rural postal routes.
MPS: Mail Preference Service, the Direct Marketing Association’s database of consumers who have specified that they don’t want to receive unsolicited mail.
NCOA: National Change of Address, a correction service provided to mailers by the USPS through its licensees. All change-of-address data submitted by relocating customers are transmitted daily to the USPS National Customer Support Center in Memphis, TN. The center consolidates the data, then places the data on computer tape, and standardizes the addresses against the ZIP+4 databases. The licensees match computerized mailing lists with change-of-address data, and NCOA provides current standardized and ZIP+4 coded addresses for all residential and business movers.
POSTAL ENDORSEMENT: A service run by the USPS in which, for a fee, a carrier will fill out a form notifying the mailer of any address that is found to be undeliverable.