CASE STUDY
How a Global Health Company Saved Millions on Direct Mail With One Simple Change
Optimizing Address Hygiene to Cut Costs and Improve Customer Experience
KEY TAKEAWAY
By leveraging GrayHair Software’s UAD, this Health Company transformed its direct mail strategy, achieving millions in savings and enhancing customer engagement. With improved address accuracy, fewer undeliverable mailings, and a stronger brand reputation, the company now integrates this game-changing approach into its operations four times a year—proving that smart data use leads to massive impact.
HIGHLIGHTS
- 545,411 undeliverable addresses suppressed
- Immediate cost savings of $1.25 per piece
- 1,791% ROI achieved in just six months
SOLUTIONS USED
- Universal Address Database (UAD): Identified undeliverable addresses before mailing
- Advanced Data Cross-Referencing: Prevented wasteful mailings to incorrect or outdated addresses
- Eliminated the Costly ‘Third Hit’ Process: Saved up to $7 per undeliverable mailpiece
- Optimized Direct Mail Strategy: Increased efficiency without sacrificing reach
INDUSTRY
Healthcare & Insurance
The Problem
A leading Global Health and Well-Being Company relied heavily on direct mail to acquire customers for its Medicare supplement plans, sending between 15 and 20 million mail pieces per month.
The Company needed to ensure that its direct mail efforts reached the intended recipients while minimizing undeliverable-as-addressed (UAA) mail. Despite using standard address hygiene solutions, the Company faced unnecessary costs associated with mailing to incorrect or outdated addresses.
The Challenge
The Global Health Company was preparing to mail a new list of 50 million records and needed to reduce costs without sacrificing reach. Standard address hygiene practices, including USPS’s Address Change Service (ACS), National Change of Address (NCOA), and Coding Accuracy Support System (CASS), helped identify some undeliverable addresses.
However, the Company had a “three-hit rule”—a record had to receive three UAA notices before it was suppressed. Obtaining the third hit was challenging and costly, as it often required mailing an expensive 9″ x 12” kit ($5–$7 per piece) or a less expensive tri-fold mailer ($2–$3 per piece). Additionally, the Company wanted to prevent the negative customer experience of mailing to deceased individuals’ addresses.
The Approach
To enhance its address hygiene practices, the Company partnered with GrayHair Software to leverage its Universal Address Database (UAD). UAD is a proprietary database of change-of-address and undeliverable mail records, compiled from over 500 million consumer records. By cross-referencing its mailing list with UAD, the Company aimed to identify and suppress undeliverable addresses before mailing, effectively obtaining the elusive third hit without incurring additional mailing costs. Leadership agreed to test UAD first to evaluate its effectiveness before fully implementing it.
The Results
The test phase yielded impressive results:
- Out of 10 million test records, UAD identified a suppression hit rate of 2.7%.
- When applied to the full 50 million records, the Company suppressed 545,411 undeliverable addresses.
- This suppression translated to an immediate cost savings of $1.25 per piece, exceeding the Company’s annual savings goal within just six months.
- The total return on investment (ROI) for UAD was a staggering 1,791%.
- Additionally, 25,000 deceased records were suppressed, reducing the risk of sending mail to the families of deceased individuals and improving brand reputation.
