REPRINTED FROM DIRECT MARKETING, AUGUST 1995 ISSUE
By Leslie Mandel
Mailings are expensive. There are so many aspects to them that do not occur to mailers living as they do with the memory of reading about the Pony Express. When mailing hundreds of millions of pieces of mail, every envelope that does not arrive costs the mailer money. With as many people alive today as there were deaths in all of human time and with 20 percent of businesses moving every year and 6 percent of the home population moving each year, mailers have a very large job to do indeed. So how do they keep their lists deliverable or, in industry terms, CLEAN.
Aside from giving a trusted friend our mail, mailers had to trust the Post Office to return any undeliverable mail to us so they could "update" their in-house lists. In my memory, from 1967 to about 1983, it was relatively easy to print RAC or return address correction in the left top corner of envelopes, and the Post Office would return undelivered mail for 15 cents. In 1995, this is now 25 cents or more. If your list was larger than you wanted to mail, you could get another mailer to mail to your list for no charge for the list itself, and the mailer would pay for the returned mail and you would then pay your service bureau five cents to change the "nixie" on your list.
Populations and lists grew. Mailers could not face the mounds of RAC mail being returned. The computer came into existence just in time. List owners then turned to larger list owners with clients such as magazine owners who, it was thought, would write to the magazine when they moved so that their subscription would continue to come to them. After all, it was already paid for. Polk, Metromail and others with mainframe computers offered the service of passing your lists against those on their larger database, and you would receive your files back; your original input tape; the tape that matched their file; the tape that they deemed were nixies--people on your file that they knew were bad addresses--and a fourth tape that were names that you had that THEY did not have. These were people who may have donated to a charity or bought a product, but they simply did not have a magazine subscription.
And populations grew. The postal service caught on. It began giving out
postcards so that people would provide their new address. Eventually, around
1985, it started putting these new addresses on computer. Direct mail companies
pushed the postal service, which decided that for a $100,000 yearly fee
it would provide 18 service bureaus with the tapes for profitable use, and
NCOA began. The National Change of Address program delivered the change
of address tapes on a continual basis to be available at the 18 service
bureaus so that they could make money "cleaning" other lists.
It was a help. Except that Only, about 7 percent of the moving population
bothered to fill our the cards. In addition, for a specific period, the
Post Office only had the service available in very few areas of the country.
If someone mailed by return address correction at this point in time --
or first class mail -- they would be receiving back from the Post Office
93 percent of the mail marked no forwardable address available. Even though
the Post Office has caught up--by covering all of the country--the number
of people who fill out the cards is only about 20 percent, AND the Post
Office only keeps the old and new address for about three years -- sometimes
only, 1 and 1/2 years. The new irksome stamp reads Forwarding Order Expired.
The Post Office tested keeping Moved No Forwarding Address tapes in certain
cities, but this has not been available to direct mailers. They should cry
out for it.
And so the industry has changed. Data cards for mailing lists that used
to have one number for the number of names on the list now started sprouting
"hot" numbers. Everyone clamored for only the new names added
to the list.
Enter the beginning of demographic overlays. The joys of reaching only 45-to 65-year-old women for a catalog of certain styles of dresses could be discussed, but the topic is deliverability. The demographic overlays help to clean a list because they provide extra verification that a person still lives at a certain address. One large credit bureau has this information. In addition, most banks in the United States report monthly about whether or not an individual paid their credit card on time. This was thought by some to be the best way to clean lists. Who other than a bank can be trusted? If you owed money, they certainly would know where you lived. This could give you 76 percent accuracy on the deliverability of your list. EXCEPT that no one credit card bureau covers 100 percent of the banks, and many people do not have credit cards. You get back three tapes: your input tape, the tape that matched the credit card addresses, and the tape of the names that cannot be identified. You had, and have, to use NCOA, which brings your accuracy to 83 percent (a 7 percent addition). The other group on your list would be questionable. You could not trust mailing it. So you would not.
Then there is another problem. Men usually die first in this country, and widows can tell you to the exact minute how many minutes- or years-ago they died. But they do not tell anyone else outside of families, and most continue to use the credit card in the deceased husband's name. Worse if she moves. NCOA will pick up her new address, but the ghost of her husband will stay, on everyone's list forever. The United States of America does not keep matched birth and death records by state, let alone nationally. Enter the deceased files. There are three to four companies, (The Rich List is one of them) that own files of people who have died. They are files made up of nixies from return address mailings, demographic overlays, records from newspaper obituaries, and people who applied for social security. They can increase a list as much as 7 percent, so now you are up to 90 percent (of your full original list). You must of course run the "pander" file or list of people who do not want to receive mail advertising and have signed up for the Direct Marketing Association's Mail Preference Service. You will now have 92 percent. You must run both the overlaid tape that matched the bank records and the other that does not. The overlaid tape will still pick out more nixies than even the banks knew about, as will the pander file. At this point, you can almost trust your main file, and 16 percent of the other file.
Then you overlay telematch programs. You will be able to telemarket the "good" file, and you will be able to add back in to the "good" file the matched names from the bad" file. Remember, however, that by the time the phone company prints a number in a phone book, it can be as much as six months old. But within reason, you can believe that your main file will now be almost I 00 percent deliverable and you might pick up more for your other file. A total of 100 percent deliverable on your main file depends upon how many people stayed at their home without dying, changing their phone number for equipment reasons, or harassment, and who want mail and have credit cards or magazine subscriptions, while you are in the process of running NCOA (I 0 to 21 working days, and running the pander file 10 to 21 working days. Five processes that can take 15 weeks and be very costly. But it is worth it to keep your files clean.
You will save on postage, printing, paper, and mailing services. But more importantly you save names of people who care about you--and who buy from your company. The "hot" line is a myth created by the brokerage community to deal with the problem of another NEXT MONTH from a HOT or 30-, 60-, 90-day new addition to a list? But they might 15 years later, if you could find them. If you rode horses at age four, you probably still love them. At age 25, You can afford a book about them, at age 30 maybe a saddle, and at 50 perhaps a horse and barn. If the seller can find you. Interests by psychological testing, do not change much over the years -- circumstances do.
Certainly the List Owner should be keeping their list clean, but the List Renter should be cleaning the lists they rent as well--if only the death and pander file.
Finally, the industry usually Guarantees up to 85 percent deliverability because you cannot trust the Post Office to actually deliver a 100 percent deliverable list. Why? That is another article.
The author is the owner of The Rich List Co., New York, a division of Leslie Mandel Enterprises, Inc. In addition, Leslie Mandel is an investment advisor, fund raiser, and author.
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