KEY POINTS:
New Zealand Post is getting pedantic about how businesses address their mail, and the result is that in a year organisations that haven't cleaned up their databases will miss out on valuable bulk mail discounts.
Some of the exacting new address standards may appear trivial, considering how much it will cost organisations to fine-tune their databases. To take an example from NZ Post's website: "21A Main Street" is acceptable but "21 A Main Street" (with a space between 21 and A) is not.
Post, which shifts a billion items a year to 1.85 million addresses, says the new rules will enable more efficient processing of mail through its automated sorting equipment, which means postage charges can be kept down.
There is a strong incentive for businesses to meet Post's requirements. From July 1 next year only organisations able to prove that at least 85 per cent of their addresses are correct will qualify for full bulk mail discounts. The discounts amount to savings of up to about 15c a letter.
Post also says businesses will gain other benefits from tidying up their mailing databases.
"For some reason in New Zealand we've tolerated poor addressing for a long, long time," the company's national agency sales manager for mail marketing service, Nick Brown, told an Auckland business audience on Tuesday.
"This is despite the fact that 20 per cent of us move every year, about 50,000 new addresses are created every year and in the past 15 years the number of addresses in New Zealand has grown by about 25 per cent."
Poor addressing resulted in a high number of letters sent back marked "gone no address" and ensuing costs for businesses including reworking invoices and chasing late payments.
The advantages of good addressing for businesses included "up-selling opportunities" from having a better insight into their customers, Brown said.
"To gain all those business benefits comes back to having good data quality and good addressing standards," he said.
Brown was speaking at a seminar on dealing with the new address standards, organised by data analytics company Datamine.
Datamine managing director Paul O'Connor told the seminar he suspected that a year before the deadline for having at least 85 per cent of addresses on their databases meet the standard, many businesses would be at a 1 to 2 per cent compliance level.
To a large extent that low compliance level was because of last year's rejig of the postcode system, a change also designed to increase mail delivery efficiency.
"Most businesses will not have gone though their databases yet [to update postcodes], and because you need that postcode to be correct, I'd say 90 per cent of New Zealand businesses would be under 10 per cent," O'Connor said.
Datamine is one of several businesses selling database-cleaning software and services to about 3000 with mailing lists containing thousands of customer entries.
"It's a fairly easy step, in terms of an automated process, to get [a database] up to about 70 per cent [compliant] on average," he says.
"In some cases the databases won't get past 50 per cent just because of the data that's been going in; others will get up to about 95 per cent."
Datamine's marketing pitch to win business in this area involves giving away software that generates the database "statement of accuracy" required by NZ Post. If a business's accuracy rate falls below the required 85 per cent level, Datamine will charge $2000 to $3000 to clean it up.
Datamine says the $3000 cost of tidying a 50,000 record database would be a good investment for a company sending out a twice-yearly newsletter to all its customers because it would save about $12,000 a year in bulk mail expenses.
As companies work through the information spring-cleaning process, many - particularly the larger database keepers - are taking the opportunity to do more than tidy their address records.
About 50 organisations hold records on more than a million New Zealanders. Some of them, with their smaller counterparts, have begun linking customer address information to household location co-ordinates.
Plugging in location data enables businesses to provide potentially helpful customer services such as advice on where the organisation's nearest branch is from the home.
It can also give organisations valuable insights into the geographical spread of their customers.
And perhaps the pizza will arrive a couple of minutes quicker if the GPS-enabled delivery guy has your home's co-ordinates as well as your address.
