It's time to get back to the basics of data
In today's economy, every business is looking for ways to improve the bottom line. Extreme approaches, such as spending freezes and layoffs, are sometimes necessary, but often simply getting back to business basics can result in significant cost savings.
One way to yield tremendous results without straining staff resources is address verification. The US Postal Service estimates that 5% of all mail is undeliverable as addressed, resulting in several billion dollars of wasted postage. The true cost of bad addresses includes not only postage expenses, but also an inability to collect payment, operational inefficiencies and, most importantly, the impact on customer experience. In addition, businesses that ship products rely on correct addresses to ensure products reach their customers on time.
As the numbers show, poor data quality is a common problem. Once collected, address information is rarely looked at again. Unless a company has a well defined process to handle returned mail or customers call complaining about their delayed orders, bad data entries go undetected.
The most effective way to ensure customer addresses are accurate is to validate them as they are entered, ensuring that data is correct from the get-go and reducing the impact down the road. The result? Customers receive packages and information on time, boosting satisfaction and retention rates. This also reduces calls to customer service centers and decreases returned mail.
Take, for example, the case of Fairytale Brownies, an online retailer of gourmet brownies. With more than 200,000 orders annually, it is critical that orders, oftentimes gifts, are delivered accurately and on time. After implementing address verification, Fairytale Brownies saw immediate improvements in order processing, shipments, and customer satisfaction, netting annual savings of $30,000 in address correction fees and $100,000 in unnecessary shipping expenses.
Accurate address data also enables more effective and affordable direct marketing campaigns. For example, if out of 20,000 postcards sent, 2,000 are returned and 1,000 are duplicates, the cost of the campaign increases while the number of potential responses is greatly diminished. If data is corrected before the mailing, there are immediate savings in postage and man hours sorting returned mail, as well as increased response rates.
Using accurate address data is the first step to keeping your customers coming back. It is a simple way to lower operational costs ensuring your organization's future while having a dramatic effect on your bottom line. Who thought something as simple as an address could do all that?
Joel Curry is COO at Experian QAS. Reach him at firstname.lastname@example.org