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Return to sender: college fundraisers have discovered that the database management of mailings can have a greater impact on the ultimate success of campaigns than anyone may have imagined. Enter address reclamation.

As a fundraiser for Washington State University, Steve Schauble spends roughly $1 million to send donation solicitations to more than 150,000 alumni every year. Generally, the campaign is a smashing success--in the four years from 1998 to 2001, the school received an average of 23,000 pledges at roughly $100 apiece, for a return of nearly $2.3 million. In 2002, however, the news was even better. Despite a sagging economy, the average pledge rose by $10, netting the school an additional $230,000. On paper, it was WSU's best fundraising effort in history.

But these numbers tell only one side of the story. While the 2002 campaign netted higher average pledges than ever before, thousands upon thousands of pieces of Literature were returned to the Pullman, WA-based school, marked undeliverable. Some of the pieces were simply mailed to old addresses. Others had addresses that were incomplete, or addresses that simply did not exist. Between the return postage and the cost of themselves, Schauble estimates the school lost hundreds of thousands of dollars on the undeliverable pieces alone. That's not even including what the batch might have yielded if the pieces had reached the potential donors to whom they were addressed in the first place.

"If one out of every 100 former students becomes a million-dollar donor someday, you want to reach as many of them as you possibly can," notes Schauble, vice president of Finance for the WSU Foundation, an independent not-for-profit fundraising organization affiliated with the school. "When it comes to fundraising, it is our mission to leave no stone unturned."

As Schauble explains, in the world of fundraising, every dollar counts. Donations build endowments, endowments build rich programs and curricula, and these offerings attract top students. The students, in turn, graduate, earn, and feed the endowments all over again. Especially in a tough economy, this cycle can be critical to a school's survival. Whether former students donate $10,000 or $10 each year, it's important to keep track of them as accurately as possible, and to ensure that every mailing or solicitation reaches its intended recipient.

Indeed, at colleges and universities across the country, alumni relations and fundraising directors are just beginning to realize that capital campaigns are no better than the records you have to support them. In response, these administrators are turning to a process called "address reclamation" to clean up their data and right their ships. This process, administered by a variety of third-party organizations, hinges on a number of technologies that compare existing address databases against established sources of verified address information. At a bare minimum, these organizations correct errors and incomplete data as they go along; at best, they improve the data and seek to leverage it across a number of platforms down the road.

"If employed efficiently, this technology could save colleges and universities big, big bucks," says Arthur Tisi, president and CEO of @Thought Technology Corp. (www.atthought.com), a high-tech services and strategy company that consults for a variety of nonprofit organizations. "What kind of [school] administrator wouldn't be interested in that?"

THE MASTER LIST

By their nature, recent graduates are a hard group to pin down, address-wise. Conservative estimates indicate that the average alumnus moves three times in the first five years after graduation, making address management a Herculean undertaking for any alumni relations department. The best departments use telephone and e-mail campaigns to encourage alumni to update their current addresses whenever they move. Still, when life gets in the way, alumni forget to update information, their addresses become inaccurate, and thousands of addresses fall through the cracks.

Yet, the information isn't lost to everyone. When alumni (or any individuals for that matter) move from place to place, the U.S. Postal Service requires them to fill out a permanent change of address form to facilitate mail forwarding. The Postal Service records this information and enters it into an enormous database, otherwise known as the National Change of Address database, or NCOA. According to DeWitt Crawford, program manager for the Address Change Service Department, this database contains more than 150 billion permanent address changes, and is therefore the Holy Grail of up-to-the-minute address information overall.

"We call it the 'Granddaddy' of personal contact information," says Crawford, who is based in Memphis, TN. "If you want to know anybody's most current address, as long as that person has a mailbox and receives mail, he's in the NCOA database."

Once an alumnus enters a new address into the NCOA database, the database automatically creates a file for that individual, which remains in the database for four years. Every time an alumnus adds a new address, it is added to his or her personal file. Interested parties can search a particular file for all of the previous address listed there, or they can search the file for the most recent, up-to-date data. Across the board, address reclamation search perform this latter chore, comparing a dresses in a school's database with the latest information from the NCOA.

Still, searching the NCOA isn't as easy it sounds. Only licensed companies have access to the database, and the U.S. Post Service has issued only 18 licenses since the system went live in the 1970s. Under some of the most sophisticated encryption technology on Earth, the Post Office sends licensees packaged and stand-alone electronic updates to the database each week, adding as many as one million new pieces of data every seven days (see "Changing NCOA," page 43). If a college or university wants to access this update for address reclamation purposes, the school must contract directly with a license holder, or with a broke company that contracts with one of them.

"We've tried to control access to this information as much as we possibly can," explains Crawford. "The whole idea is to prevent individuals from coming in and looking up the latest information on just anybody."

THE BROKERS

Most of the 18 NCOA licensees deal solely with for-profit companies; as a result, colleges and universities are left to deal with NCOA brokers. At last count, there were more than 200 brokers overall, each offering different kinds of address reclamation services to a variety of industries. Most of these firms are designed to help businesses with direct mail and direct marketing efforts. Only a handful of the brokers specialize in higher education, a natural selection that makes the immediate landscape competitive but manageable.

One of the largest of these brokers is Cleanlist.com, Inc. (www.cleanlist.com), an address reclamation outfit in London, Ontario, which, surprisingly, specializes in helping more than 50 colleges and universities here in the U.S. clean up their acts. Cleanlist.com sublicenses NCOA data from Equifax, Inc. (www.equifax.com), and incorporates address information from 32 countries into a Web-based interface. This interface enables customers to upload their address database and scan it from any computer in the world. Then, for 2.5 cents per address, the solution automatically eliminates duplicate entries and corrects erroneous data, presenting customers with a list of bad addresses and their now-flaw-less counterparts. If requested, the technology also provides customers with other valid points of contact such as e-mail addresses and phone numbers, so school officials can reach out to former students in less traditional ways.

"There are dozens of ways for a university to track these people down," says Jeff Bisset, the company's CEO, "We try to present our clients with more than one option."

At 3,500-student Henderson State University (AR), Alumni Services Director Susan Myers hopes this bevy of database improvement options will help her improve her approach to address management. Myers says that administrative assistants in her department used to enter address changes manually, using Internet searches and information off of returned mail to keep the system current. Now, she adds, thanks to a new contract with Cleanlist.com, she'll be able to have these assistants focus on more important work, and leave the list chasing to the computer. "We don't expect a miracle, but we are desperate for some help," she notes.

At the University of Wisconsin, a much larger school, Information Systems Specialist Mike Polum offers similar sentiments. Polum says that for years, data-entry programmers at the school's records and registration department spent hours manually updating addresses they had learned were out of date. Last year, when the university signed a contract with Melissa Data Corp. (www.melissadata.com), all of that changed for the better. Though it's still too early for Polum to get a sense of how much Melissa Data has improved his database, all of the school's alumni address management functions are automated, and the school even uses the technology to keep track of current students as they move around town. Unlike Cleanlist.com, Melissa Data approaches database management offline, with a software package known as Address Object. A customer uploads the software to her database server, and the program operates behind the database itself, correcting information as it is entered. In addition to matching addresses against the NCOA, the software corrects addresses and ZIP codes in real time. Customers can then update the system whenever they'd like--once a week, or once a year, just in time for a big mailing or fundraising campaign.

"This is a no-risk-type solution," says Marketing Manager Jack Schember, noting that a typical Melissa Data installation can cost anywhere from $3,000 to $10,000. "Improving the data in your database can only make you stronger."

A PERFECT WORLD

There are other options for address reclamation, from the barebones to the high end. Technology giants such as IBM Corp. (www.ibm.com), Oracle Corp. (www.oracle.com), and Microsoft Corp. (www.microsoft.com) provide the latter, offering address-cleansing services that include everything from the "urbanization" of rural addresses to the process of flagging individuals who are deceased. On the other end of the spectrum, higher education solutions provider Edgenuity Inc. (www.edgenuity.com), provides standard NCOA matching services as part of an enrollment management package known as "Edgenuity Student Suite," a package that more than 10 colleges and universities use today. And there's provider-in-the-making All Points, Inc. (www.reachallpoints.com), which will incorporate all of the latest database reclamation technologies along with a healthy dose of common sense to provide one of the more comprehensive solutions on the market: On top of traditional NCOA matching and data cleansing, the All Points model incorporates a broadcast e mail strategy that encourages alumni to take address correction into their own hands. According to company President Carmine Iannacchino, this approach not only enables customers to correct addresses, but also enables them to leverage data and information across a variety of platforms.

"Having the right address is important, but how do you tie [capabilities] together and come up with a strategy to create a brand of quality so that when your institution solicits someone, it's received favorably?" asks Iannacchino. "Fundraising hinges upon the impression you leave with your donors, and we're trying to take that to the next level" As Iannacchino explains it, the one-two punch of direct mail and e-mail presents a unified front that "wows" alumni into responding one way or the other, or both. He estimates that within 12 months, customers will see their average failure rates drop by as much as 10 to 15 percent. To a college or university mailing to 50,000 alumni, a 15 percent increase could mean that 7,500 additional mailings "connect." And in an annual drive where 15 percent of the average alumnus contribution is $100, that mailing bump can translate to an additional $112,500 (not including the savings on return postage and printing costs)--no small change.

The promise of reaching that many more alumni is precisely what attracted Michael Larkin, associate VP for Development and director of Campaign Resources at Fordham University in New York City. Larkin signed with All Points this summer, after he received nearly 20,000 pieces of returned mail from a spring campaign to more than 105,000 alumni. These results prompted university officials to demand increased efficiency in future campaigns, and Larkin says he's hoping All Points can help him turn things around. If the company delivers what it promises, Fordham could reach an additional 15,000 alumni by the end of next year--an improvement that should net the school millions down the road.

"In order to cultivate a lifelong relationship with our alumni, we need to communicate better than we've ever communicated before," says Larkin. "From where we stand today, we see this as the best way to do it."

THE SWEET TASTE OF SUCCESS

Because so many schools are new to address reclamation services, perhaps the best demonstration of success lies with Schauble, the fundraiser at WSU. After coming to terms with the fact that he needed to clean up his database for the 2003 campaign, Schauble selected address reclamation firm Business Credit Information, Inc. (www.2bci.com), to clean things up. Representatives from BCI uploaded the WSU database to their system, ran it against the data in the NCOA, and applied a series of proprietary tests that incorporate the latest data from credit databases. At the end of the process, BCI had confirmed more than 100,000 of the addresses in the WSU record, and corrected nearly 4,800 bad ones. Schauble was delighted. He had agreed to pay BCI $1 per address for every address the company corrected, for a grand total of $4,800. On the flip side, after applying WSU's standard 15 percent success rate to the 4,800 new addresses, and forecasting that at least 720 former students would donate an average of $110 apiece, he estimates that the effort will net the school nearly $80,000 during the 2003 campaign. Factoring in savings an return postage and wasted printing, Schauble figures he'll hold on to an additional $20,000 on top of these profits. All told, he says, about $100,000 in combined profit and savings won't be a bad return on his investment.

"The amazing thing is that most of that money can go right into our endowment," he offers. "It's money we never counted on, and that's enough to make our administrators happy."

CHANGING NCOA

As times and technology change, so too does the National Change of Address database

For the U.S. Postal Service, updating the National Change of Address (NCOA) database has always been pretty easy. Via the use of some of the most sophisticated encryption technology on Earth, the USPS has sent licensees packaged and standalone electronic updates to the database each week, adding as many as 1 million new pieces of data every seven days. The process has been quick and straightforward, costing the USPS next to nothing. There was, however, room for improvement.

That improvement came this summer, when the Postal Service unveiled a new technology, dubbed NCOA link. With this new technology, NC0A licensees have the option of receiving their updates electronically each week, or accessing them online, through a Web-based database that updates automatically every seven days. The new Web site operates with a special kind of security system, encrypted so that users must provide an algorithm key in order to be able to read the data.

The new system is designed to control access even more than the traditional one. In the past, licensees with access to the data could mine it any way they desired. Now, because the data is secured every step of the way, the only way licensees can manipulate the data as they choose is to pay for the algorithm keys that enable them to do so. Though functions of this new system will cost more, the USPS plans to issue more licenses to access the system. By November 1, software vendors who write address-matching software will receive licenses and be able to incorporate the new Web-based service into their products. This is only good news for colleges and universities: The more opportunities to access correct and up-to-date address information, the better.--MV

Matt Villano is a freelance writer based in Seattle and Mass Beach, CA.
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Title Annotation:Database Management & Integration
Author:Villano, Matt
Publication:University Business
Date:Aug 1, 2003
Words:2683
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