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Are You Hiding Your Returned Mail Under the Tree?

Written by Michelle Toivonen and Leslie Nienaber

It’s a problem every business faces, yet most employees hide it in dark storage rooms, dusty shelves, or even in the trash: we’re talking about returned mail. Aside from not reaching your prospects and customers, returned mail can be detrimental to your company’s bottom line and can indicate underlying data issues that may be affecting other areas of business as well. It’s enough to turn anyone into a Grinch!

Why Does Returned Mail Happen?

One of the main reasons returned mail occurs is because we live in a world where people frequently move. 17% of the population moves every year, and only 40% of those people remember to file a COA (Change of Address) with the USPS. Considering the fact that online bill payment has become more prevalent, it’s easy to understand why this would be the last thing on someone’s mind.

Not only do individuals move, but data moves around as well – from one CRM to the next, from online forms to Excel spreadsheets, even from one sheet of paper to another, data is constantly being added and updated in our systems. Sometimes the data is right, but most of the time, the opportunity for error is extremely high. 76% of undeliverable mail is due to outdated or incorrect address information, with missing secondary information (such as suite numbers) and vacant addresses following close behind. Without routinely performing data audits, these address issues can remain unresolved and returned mail can easily build up.

Companies who buy purchased lists are at risk, too: while many companies believe purchased lists are routinely updated, it isn’t always the case. Even companies with dedicated data management employees will inevitably experience some sort of decay in data quality, especially with so many opportunities for error (misspellings, deliberately entering incorrect information into forms, etc.).

What Impact Does Returned Mail Have on a Business?

For every piece of returned mail, a company is losing out on money and an opportunity to communicate with a customer or prospect. Returned mail impacts the profitability of a business in many ways, including:

  1. Lost revenue and opportunities
  2. DSO (Days Sale Outstanding)
  3. Cash flow
  4. Postage costs
  5. Printing costs
  6. Returned mail destruction

The cost per returned mail piece has been increasing over the years, ranging anywhere from $3 to $50. In 2016, mailers lost a collective $20 billion due to more than 6.6 billion pieces of undeliverable mail. For businesses that frequently send bill statements, the costs can directly impact the bottom line: a customer bill for $110, for example, may not seem like much on an individual level. Multiply this by 10,000 returned mail pieces, however, and it’s easy to see how returned mail can begin to impact a company’s finances.

These hard-hitting costs do more than fiscally impact current business – they also greatly impact future revenue, as well as customer relationships. A customer relationship really doesn’t exist if there isn’t any communication. Sending mail to an incorrect address is similar to calling someone and realizing their number has been changed — you really didn’t connect at all. When returned mail is marketing mail, there’s a chance that the customers are being nurtured in other channels, such as emails or social media. Receipt of more serious pieces, such as transactional or confidential mail, however, is mission-critical to your customers. A miss there could be the final straw for a customer teetering on the edge of trust or brand loyalty.

For some businesses, returned mail can also pose a serious legal threat. Mailers under strict regulatory guidelines must pay special attention to postal compliance: documentation must be provided to prove how a business has tried to correct the returned mail, with hefty fines appearing for many who do not rectify addresses within a certain number of days.

Legal, financial and customer impacts aside, the cost of returned mail affects most departments. Internal resources and personnel are taken away from their current duties to manually fix returned mail pieces, customer service representatives get bombarded with calls, IT is pulled away to investigate errors, and the list goes on. Ultimately, customers are lost, trust is diminished, revenue is delayed and employees are pulled away from their primary responsibilities.

What Can a Business Do to Fix Returned Mail?

It’s important to note that returned mail can never be fully fixed – a certain level of address decay is inevitable. However, businesses that aim to lessen their returned mail by even 20% reap the rewards of accurate data, increased customer communication, and less postal and financial waste.

Unfortunately, cleaning up returned mail can be daunting as there isn’t a clear-cut way for businesses to repair their returned mail in-house. Mailers find cleaning up returned mail internally requires additional resources and learning several new pre- and post-mailing services, such as NCOALink®. Depending on the size of the company, amount of data sets, and even number of business locations returned mail is more likely to be ignored or hidden rather than investing the time (usually several years) to put an effective internal process together.

Let’s Fix This!

The first step in fixing returned mail is to recognize the issue for what it is: a costly, ever-expanding drain on finances and employee resources that is causing you to lose touch with your most valuable customers.

Second, perform a data audit. Whether a business is deciding to fix returned mail in-house or using an outside service, clean data is key. Performing a data audit will help resolve the “little but big” issues that cause returned mail, such as address or name misspellings, inconsistent or incorrect abbreviations, duplicates, and other data anomalies.  

Lastly, be realistic about your commitment to resolving returned mail. Cleaning up your data and running it through several change-of-address services once or twice may provide good short-term results, but returned mail is not a problem that can be rectified overnight — it requires consistent attention. Returned mail services such as Redirect+ can take the large, costly burden of undeliverable mail and turn it into something positive again: clean data, less waste, and better customer relationships.

What Are the Benefits of Using Redirect+?

By automating how your returned mail is handled, services such as Redirect+ can potentially reduce operational expenses by up to 70%, put value back into your mail, and reach your customers faster.

How Redirect+ works:

  • UAA (Undeliverable As Addressed) mail is picked up by Midwest Direct. From there, our data team manually opens the contents of the envelope and enters relevant information from the piece into our system.
  • We tag appropriate data sets for the client’s tracking purposes and process the information through proprietary and public data sources to update the address for delivery.
  • The updates are formatted electronically and then sent back to the client to be updated in their systems. In addition to updating address information, Redirect+ can provide data sets from your returned mail that will provide additional insight into your company’s ROI.

Additional benefits and services:

  • Readdressing the original returned mail piece and forwarding mail to the newly-updated address.
  • Access to a safe and compliant service allows businesses to minimize the risk of postal inspection service audits.
  • Can reduce the time of getting the original document to your customer from several weeks to only a few days.
  • Complete management of all returned mail functions, with solutions including: document capture, address research, system record updates, re-mailing, imaging, archiving and secure document destruction.

Get on the “nice” list this year by cleaning up your returned mail once and for all. Contact us to get started.

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