18monthreport

Our Report Card

Today is a memorable day for GDC. 18 months ago our first customer went live with our Worldview product, relying on GDC and Worldview to provide Address Verification. This client took a chance –to meet their needs for the best verification rates possible, they had to embrace a new model.

When we first speak with clients we explain our model – we find, qualify and integrate local companies that have the best address processing technology in their country. We harmonize our partner’s technologies and serve up all of that global value with a single OnDemand API. We understand that this model differs from other companies who build a single product, from a single data source, delivered the same way year-after-year.

Our clients embrace Worldview for innovative use cases. Companies validating address information as a key component of Identity Verification. eCommerce companies supporting cross-border commerce. Global organizations verifying and locating millions of points of interest. Delivery companies testing addresses to de-risk their logistics processes.

Now that we have been live for 18 months we can test the assumptions we made at the beginning. We had certain beliefs at the onset, how did we do? Let’s look at 4 of our initial suppositions.

Local Partners = Local Insight

We believed at the beginning that local partners would understand their country best and three themes have emerged. Within their country our partners handle regional variation, bad data patterns, and multilingual challenges better than anyone else.

Local Partners = Access to Unique Local Data

We thought that our partners would have insight on accessing, integrating and utilizing additional local data into their solution. GDC partners understand how to blend unique data into their solution, and they have the time and focus to do this work. Over half of our partners are using some form of data that is not being used by a global player.

Local Partners = Battle Tested Technology

Great address technology only gets great because it gets utilized; no one starts with an A+ product. We surmised our partners’ technology would be battle tested. For example, one partner’s offering is used by their country’s national post, and is accessed over a million times per week; the national post validates the goodness of their technology. This is representative of all of our partners – their technology is great because it gets used in-country, by clients that demand the best results.

Local Partners = Awesome Responsiveness

We knew our partners would be responsive in many ways. Our partners react quickly to new use cases and new address forms. Last month one of our customers had an issue with how a certain address suffix type was being handled, a pattern that would never be used in-country. Our partner enhanced their behavior and a correction was available the following day. Our partners are creating the next required services. A great example is our India partner that launched an advanced service. Our partners must continuously innovate; they don’t have the luxury of only revisiting their technology once a year, or when enough complaints for their country have piled up.

Where Are We Now?

After 18 months we have proven our beliefs at the beginning of this journey. We have worked with partners and clients that are willing to challenge conventions for how global address processing gets done. We continue to add countries to Worldview, and continue to tune Worldview to handle innovative eCommerce, Identity Verification, global point of interest, and delivery logistics use cases.

So that’s where we are 18 months since going live. Let’s see what the next 18 months brings. As always, we enjoy speaking with clients about how we can help you solve your business problems. Give us a shout and let’s see how we can expand your Worldview.

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New Advanced Address Verification Services in India

At GDC we are continuously searching the globe for new partners, new countries and new services for our customers; we enjoy telling the stories about our discovery and availability of these services!  We also work with our Partner Community to add additional capabilities to existing Worldview countries, and we are excited to announce the availability of Advanced Address Verification for India.

Our global expertise tells us that India is the most challenging country to provide great Address Verification due to the size of the country, the complexity of address information, and the regional variations of address information.  We hear from our customers and read recent studies that project tremendous opportunity in India for companies that are using the best available Address Verification solutions for eCommerce, Finance, and Logistics business problems.

Working with our premier Indian Partner, our Advanced Address Verification for India provides you with the most reliable solution for interpreting Indian Addresses.  Do you know that across India there are over 400 different building descriptors?  We do.  Our highly configurable solution reliably parses, interprets and verifies all of the components of an Indian address – road differentiation, sublocalities, localities, pin codes, buildings, building numbers, wings, floors, and more.  We can turn on additional custom capabilities to meet the needs of your business problem – delivery flags that set shipment expectation, corporate address indicators, and rural/urban coding.

We are always excited to open up additional services for our Worldview customers. If you want to understand more about Advanced Address Verification for India and discuss the challenges of addressing in India, give us a call. We’d love to help expand your Worldview.

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GDC Onboards France’s Best In-Country Data Provider

This week at GDC we’re thrilled to add a new partner from France, bringing the best in-country data solutions for French address verification. This is an important addition for us; at 62 billion dollars in eCommerce sales, France is the sixth largest eCommerce market worldwide. On top of that France is a wired culture, and nearly 89% of the country’s internet users are shopping online, with individual purchase rates going up. From both a local and global perspective, France is an important player in the market and eCommerce companies need to have a reliable solution when it comes to French data.

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But the value of having our best in-country data provider goes beyond just meeting the market. When it comes to culture, French consumers place a high value on service quality. A DPD survey of online commerce habits showed that one in five deliveries in France was problematic, and 49% of the time this was because the delivery was late. They go on to show that French consumers overwhelmingly (84%) prefer things delivered directly to their home, rather than to post offices or other pick up sites.

 

eCommerce companies recognize the implications in this. They want to be able to attract new customers in France by offering convenient, on-time door deliveries. They also want to retain customers by making sure that they can follow through on that promise. After all, nearly 70% of customers said they wouldn’t buy again from a website that didn’t deliver on time.

 

This is a challenge in France. Delivering to secluded cottages in Champagné can be just as difficult as delivering to a one-room apartment off of la République in Paris because of how address information is used and changed. Generic data, which might be managed anywhere in the world, is never going to be able to effectively keep up with the dynamics of French society. That’s where our local data solution can provide the most ‘lift’.

 

The Dynamic French Landscape

 

Last spring, I visited a friend in Paris while checking up on some of our local European providers and I needed a couple of books. They happened to be on Amazon.fr, and I asked for the building’s address so I could get them delivered to me while I was there. My friend told me that it was better to send them somewhere else, since most of the packages for that apartment had never showed up at all.

 

Being in this business, I got interested and dug a bit deeper. The apartment did not have a number, which is common, and that the name used for deliveries was of a prior leaser, not my friend’s name, which is also common. The process of updating address and identity information with La Poste, the French postal service, can be prohibitive and so data can often be left outdated. In this case, the “address” of the apartment was under the name of a woman who had been leasing it 4 years ago. It’s like if I wanted to send something there, I would have to know the history of the apartment ownership to do it.

 

The reality of these deliveries is that the package might show up at the right building, but after that it’s anyone’s guess. It might end up at the right apartment, it might end up at another apartment, or it might not get delivered at all. In the end, I sent the delivery to an office in town that said they had no problems with deliveries. But if I had wanted to send it to that apartment, I would have had to write several names down on the package to get it to the right place. Depending on how that package changed hands it might still have gotten misplaced.

 

Local Data Knowledge as a Solution

 

This is obviously not the optimal way to do things, and that’s where GDC’s unique approach to address verification comes in. When we set out to solve this problem, it was apparent to us that generic datasets can be useful but are inherently problematic. They aren’t managed by people that understand the context of the data and they can often go without updates. At GDC, our team fans out across the globe to find the best LOCAL providers of knowledge, and then puts those companies through rigorous testing to make sure that their data is up to scratch. The result is what we call the ‘intelligent stack’. We take an address and redirect it to the best in-country data source in our consortium.

 

The results of using these local data sources are impressive, and our new partner in France is a powerful example of this. They combine data from marketing databases and private commercial sources that has coverage all across France and can have better resolution than other datasets. Our partner is also updating this data constantly, receiving information from sources constantly and applying address and verification rule changes at least once a month.

 

This kind of data and refresh rate prevents problems like the one I had in Paris, and can improve delivery reliability overall. Companies know this is critical to the French market, and they know just how fickle consumers can be if deliveries aren’t right the first time. It’s a survival need, and for a dynamic like France, generic data just doesn’t cut it. Businesses need local data for France, and with our newest French partner, we are pleased to deliver for our Worldview customers. If you are looking for a more reliable solution to delivering in France, or anywhere else in the world, please give me a call. We’d love to help expand your worldview.

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GDC Integrates Best Turkey Address Partner into Worldview

This week we announce the integration of Turkey’s best address intelligence service into GDC’s Worldview platform. Our partner, an Istanbul business with over 10 years of experience working closely with the Turkish government, demonstrates the command of local nuance needed to be the country’s most reliable address resource. As I discovered on a recent trip, if ever there is a country where local details make a difference in getting the right address…it’s Turkey.

The Turkish Opportunity

Istanbul straddles the East and the West. Standing on a bridge watching ships traffic the waterways and listening to the call to prayer in the background brings into stark clarity – I have ventured into a brand new cultural world. While Turkish commerce maintains its traditions of merchants peddling wares in the Grand Bazaar, it has evolved to also include the most sophisticated forms of cross-border eCommerce.

The world’s great brands recognize that Turkey is an exciting market. eCommerce has grown over 500 percent since 2009, most of which has come from consumers buying goods that are shipped from out of country. And the youth are driving the economic boom. Less than 15 percent of the population is over 55, meaning a tech-savvy and brand-conscious generation is defining the country’s new buying habits.

But when it comes to addresses, businesses shipping product into Turkey are going to need a lot of local help.

My Address Confusion in Istanbul

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While in Istanbul I had a couple of key experiences that highlighted the difference and difficulties of address verification in a city in this region.

The first was getting to my hotel. My bus dropped me off in the city’s famous Taksim Square, a tightly-packed area with nearly 20 hotels all within a few blocks. I tried to use my phone to navigate to my hotel’s address, but the map could only get me to the center of the square. It could not find the location with any greater precision, so – in an effort to triangulate my way to the proper destination – I resorted to stopping into shops and asking clerks to point me in the right direction. Even though I had the proper address, the mapping technology was not able to provide the granular result I needed to find my hotel.

Then I had to get to our local partner’s office. Istanbul is massive with many districts and neighborhoods. I gave the taxi driver the office address, and he immediately honed in the district, then found the proper neighborhood and upon “arrival” he starting asking locals where to find the final destination. Why? Because the address I had was missing a crucial piece of information…a proper cross street. As I came to discover, in much of Turkey you need to provide cross street information both when getting directions and also to ensure prompt and accurate delivery.

These kind of details are often overlooked by global address verification systems that rely on generic, international standards for formatting and validation. As I’ve found over and over again in my long address intelligence career, you simply cannot know the nuances of a country unless you are working with partners that live there, speak the language, and provide address services to local businesses that rely on accuracy. That’s the power of local intelligence in making sure you get your addresses right.

Dinner on the Bosphorous River and Reflections on Local Intelligence

On my last night in Turkey the founder of our partner company squired me out of Istanbul, bringing me north along the Bosphorous River. We traveled until the road ended at a quaint fishing village, and we sat outside on a chilly evening, dining on some of the best seafood I’ve ever had in my life.

At dinner we spoke at length about his company and how they apply local knowledge to help businesses get Turkish addresses right. He talked in length about serving Turkish companies, taking their feedback, and constantly improving his address data and rules. We spoke about the growth opportunities that his clients were experiencing in Turkey and beyond. We discussed the expansive world of international commerce and yet how so much of success depends on getting things right on a local level.

As I peered out into the night, I saw the flashing red lights of a freighter cruising up the river. My colleague pointed out that around the bend, and some miles away, the Bosphorous empties into the Black Sea. I couldn’t help but reflect on how close we were to Crimea and Ukraine, countries that had always seemed to me to be so different from Turkey, but are so close and so connected.

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Info From Brazil Correios About Upcoming CPF Requirement

Overview: Charles Prescott, Executive Director of the Global Address Data Association, wrote the following article and gave us permission to post it here. There has been much uncertainty over Brazil’s new requirement that all incoming parcels carry with them the recipient’s CPF tax ID number. It will affect carriers, postal agencies, eCommerce services and merchants that do not currently collect this information from their customers. After a brief implementation period, any package they send without a CPF will either face a delivery delay, be destroyed or be returned to sender.

There have been no official statements from Brazil about the new requirement or when it goes into effect, so Charles went straight to the Head of International Department for Brazilian Post. See his comments below.

If your business is affected by this change, GDC can help. If you’re not collecting CPF numbers from your Brazilian customers, we can provide those for you. To find out more, contact Paul Dryden at 919-807-1740 or paul@globaldataconsortium.com to find out more.

Shipping to Brazil? Yet one more possible problem….

We were recently alerted of talk in the industry that the Customs in Brazil has started requiring that inbound parcels bear a “CPF” before they can be cleared, including parcels arriving through Correios.

The CPF is somewhat unique. CPF stands for the Cadastro de Pessoa Fisica ( Brazilian Taxpayer Registry). This is a database maintained by the Federal Revenue, ie tax, department. If you fall into one of three categories, you must register and obtain a CPF number. The categories are: Brazilians, foreigners resident in Brazil, and foreigners living abroad but owning assets in Brazil. When registering, you receive a permanent number which is unique to you, like a US Social Security number. This is used in nearly every commercial transaction one conducts in the country.

In short, the average customer in Brazil buying something in the US from Amazon (or anyone else for that matter) will not receive his or her parcel unless the CPF is on it and duties, often very substantial, are paid.

In the past, parcels arriving through the post, or tendered to the post by private couriers, went to the final delivery post office and the customer was contacted to come to pay the duties and collect the parcel. We understand that the authorities, in dire need of more revenue, decided that a more stringent tax collection discipline was required. Hence no parcel leaves Customs or Correios without a CPF on it and taxes paid.

We became alarmed at the prospect of thousands of parcels from foreign websites being piled up in Brazilian Customs or Correios, and so we emailed our friends at Brazilian Post to determine if the rumors were true.

Our friend Alberto de Mello Mattos, Head of the International Department of the Brazilian Post very kindly informed us that, indeed, parcels must contain the CPF before being presented to Customs. The new system will receive parcel‐specific data from couriers, private postal operators and posts which will be provided to Customs for clearance.

Brazilian Post is currently urging its trading partner posts to observe an enhanced parcel‐ specific standard that includes the CPF. This could resolve the problem, but it is a lengthy process to accomplish. Institutions responsible for standards, and their modification, are extremely cautious and thus obtaining modifications can take substantial amounts of time. Imagine how long it will take the USPS to begin to insist on CPF’s on Brazil‐bound parcels, and then how long it will take American businesses to do so. But you better do so, and quick.

To avoid as much trouble as possible, as soon as possible, the industry should do its best to convince shippers to collect the CPF on the website’s order form.

Where the parcel contains the CPF, it will pass through Customs for delivery in normal course. Where it does not, a system is being created to notify the addressee and request the needed CPF through a new dedicated website.

Part of this process to connect CPFs with parcels is ID Correios. ID Correios is a web authentication tool; all customers who interact with Correios must register in this system, which can verify the existence of the CPF claimed, or possibly provide one if it is missing. This system thus engages the addressee in the process. Of course, first‐time online buyers might not be in the system. And any system is capable of breaking down.

Mr. Mello Mattos put it succinctly: “ In conclusion, from the new system onwards we have to provide to Customs the CPF, before submit the item to them or alternatively, before release the item from our warehouse for final delivery.“ So now Correios is most definitely part of the tax collection process.

It is a universal truism that despite the best efforts of participants in a process, things will go wrong. Despite best efforts, Correios’ system will be stressed with parcels lacking a CPF and whose addressees can’t be located, or who are not in the ID Correios system. Any country’s system would be stressed with this.

How many will be returned, and how many will disappear? Who knows? GADA has been trying to find out the volume of “gone‐missing” parcels in the international system for years now, and no one in the posts, any post, will talk about it over coffee, let alone on the record.

If your company or you clients do business with Brazilian consumers, it will definitely be advisable to collect the CPF on check‐out and provide it on the package. Make it easy for the customers and they’ll be back.

See Charles Prescott’s full article on the Global Address Data Association blog, http://www.globaladdress.org/resources/blog/

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Shipping to Brazil? Every Package Must Now Include the CPF

Quick overview: If you ship packages into Brazil, you need to be aware of some important changes that require all labels be clearly marked with a tax ID number called the CPF. If you don’t have your customer’s CPF, the shipments will be returned or destroyed and you’ll be fined by Brazilian Customs. Many eCommerce merchants are not yet collecting CPF from their customers, and the new requirement could disrupt their Brazilian trade. GDC can provide it for you and help you avoid a disruption. Here are the details…

Brazil’s high import taxes caught the attention of financial media last year when Apple’s iPhone – which cost roughly US$600 when purchased in the States – was selling for nearly twice that in Rio de Janeiro.(1) Apple took some heat for marking up a high-demand product almost 50 percent above the monthly wage of Brazil’s average worker. But in reality most of that price bump wasn’t going into Apple’s pocket. It was required to pay the Brazilian tax authority.

Like many governments, Brazil uses duties to encourage the growth of its domestic industries. By levying customs taxes on imports, it creates a price advantage for local businesses to help them compete. Still, Brazilian consumers continue buying brands they can only get through imports, at times paying taxes as high as 100 percent.

Brazil Customs requires any incoming parcels be clearly marked with the recipient’s name, address and tax ID number. For individuals, that’s called the CPF (short for Cadastro de Pessoas Fisicas) and for businesses it’s the CNPJ (Cadastro Nacional da Pessoa Jurídica). Customs uses the numbers to assess the tax, and requires the recipient to make the duty payment before he/she can collect the parcel. Private courier services have become quite efficient at collecting a customer’s CPF and tax obligation before shipping the parcel to Brazil, ensuring it moves through customs quickly.

But when using the Correios for delivery (that’s Brazil’s government-run postal service) merchants and shoppers have found some loopholes to exploit. The Correios would accept a parcel without a CPF, ship it to a local post office near its final destination, and send notice to the buyer to come in to pay the tax and accept the shipment. Correios was supposed to collect duties on behalf of Brazil Customs. But their enforcement was spotty at best, and plenty of people took advantage of that.

No more. Seeing that it was losing a lot of tax revenue, the Brazilian government has mandated that Correios do a better job of collecting duties. Starting this summer, all shipments into Brazil must be clearly labeled with the recipient’s name, address, and CPF to make it past Customs. If it doesn’t have the CPF, the package will either be shipped-back or destroyed, and the sender will be responsible for paying a fine.

The problem is that many eCommerce merchants (and the technology platforms that support them) have not made the necessary changes to their shopping forms to collect the CPF. Things could get complicated for them in the coming months. Fortunately, GDC has a way to help immediately.

We specialize in finding the best in-country sources for identity and address data and integrating them into our Worldview platform. For Brazil, our service has comprehensive coverage (99 percent) of CPF and CNPJ information. We can take a combination of name, address, phone or email and provide back (in real-time) the CPF number for your shipping labels.

Brazil is a key market for many eCommerce companies. If this new requirement puts your trading business there at risk, GDC can help immediately. Feel free to reach out to me directly. Or click here to learn more about the services we offer in Brazil.

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GDC Integrates New Poland Address Partner into Worldview

This week we announce a new partner in the consortium, a Krakow-based business that prides itself on bringing an engineering mindset to the work of building Poland‘s premier address intelligence service.

Building this consortium is anything but a generic plug-and-play process. Whenever possible I meet personally with the management team of our partners, going to their offices, seeing their operations, introducing myself to their people. I want to show them we’re committed to this model of creating the world’s most reliable Address Intelligence solution. I want them to know that relationships will make this work.

And so last week I spent two days in Krakow with this new partner, sharing with them the results of tests we’ve run on their data, and celebrating the successful integration into the GDC Worldview platform. I had dinner with their president on Wednesday, and we talked late into the night about the opportunity Poland – his homeland – represents for cross-border eCommerce.

The Address Intelligence Stack

Before getting into that, however, let me talk a bit about what we’ve begun calling the “Address Intelligence Stack.”

Through conversations with GDC customers and erstwhile competitors, we’ve come to recognize the power of using our consortium of best, local providers of address validation to create a “stacked” approach to address intelligence services. We’ve long offered a “generic global AVS” option as part of the GDC service, taking advantage of its broad reach to make sure we could offer our clients some level of service in all countries. In countries where the generic solution offers poor service, we created the ability to route address verification calls to best, in-country alternatives. Creating a verification stack that looks like this:

STACK

We’ve decided to start offering this stack approach to companies that have already invested in a generic global AVS system but are looking to create “lift” in countries where their system is weak. That’s where we plug-in our consortium partners. When an address can’t be verified to the client’s business requirements, the system automatically routes it to Worldview for processing through our best, local providers, ensuring the most reliable results possible.

We’ll spend more time talking about the Address Intelligence Stack in the weeks to come.

The Poland Opportunity

Back to Poland. As our new consortium partner pointed out to me, Poland is often overlooked in context of the larger EU market. Despite the fact that it’s Europe’s sixth largest economy, that its people buy over EUR 6.2 billion in eCommerce goods (much of which is cross-border purchasing), and that it’s growing faster than 20 percent per year…it’s still not viewed as a market where the international eCommerce platforms invest to optimize the Polish shopping experience.

Too often they lop it into the same development category as, say, Germany and don’t integrate a Poland-specific address verification system.

That’s a mistake. Poland has its own, unique postal customs. The alphabet has its own diacritics that Polish consumers expect to see when receiving a parcel addressed to them. And Poland has its own address formats that affect how quickly packages are delivered and whether they go to the right place.

It’s time to value the Polish market for what it is (big and growing bigger!) and invest in it appropriately.

About Our Polish Partner

That’s why we’re glad to include our new Polish partner to the consortium, rounding out our list of best in-country European data sources that account for the unique needs of each country; that recognize that one-size does not fit all when it comes to the continent.

This partner has spent more than 15 years developing an address intelligence system for Poland. Along with postal information, they source data from private organizations, open source databases, and government registries. They even have an arrangement with their eCommerce clients that allows them to automatically add new information to their master file if a shopper enters an address the partner was not previously aware of. This is one of the hallmarks of local data sources…they are quick to update their data, making sure it’s as current and complete as possible.

Finally – and I’ll say this based on personal experience with the company’s management team – this partner is proud of the data they provide. They see themselves as offering a valuable service to their clients in eCommerce, telecommunications and financial services. And they bring to their jobs an engineering mindset…the idea that precision counts. All these things make them a valuable addition to GDC’s Worldview platform.

So, we welcome our new Polish partner into the Global Data Consortium. We’re excited to open up access to Poland for Worldview customers. And if you’re looking for help in Poland, or any other country in our global platform, give us a call. We’d love to help expand your Worldview.

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GDC Integrates New Russia Address Partner into Worldview

This week GDC announces the newest member of the consortium, a Moscow-based data business that specializes as Russia’s best in-country source for address data.

 

Let’s call a spade a spade: This one was tough. It was tough to identify the right Russian partner. It was tough to “lean in” to a Russian solution during a time of uncertainty when so many eCommerce businesses are avoiding that market. And it was tough to work through the technical aspects of making the best in-country Russian solution work for a client base that knows very little about Cyrillic-based alphabets.

 

After a few months of working through these challenges, we now see why other global address services have struggled so much to offer a quality Russian solution!

 

But that’s what makes this Russian address solution such a valuable addition to the consortium. Through rigorous analysis and testing, the GDC team has verified that this new partner offers true benefits. Its combination of wide geographic coverage, extensive data records, and sophisticated business logic provides a superior source of “lift” over what you can get from any of the global generic address solutions.

 

In the end, the “tough” is worth it. We can provide our Worldview customers with address information they simply haven’t been able to access before. In the process, we are helping open up Russia to eCommerce merchants, platform companies and delivery services that previously saw these same obstacles and couldn’t find a way around them.

 

With Russia fully integrated into Worldview, we now offer best available address services with localized intelligence for 35 countries (see the list here) in addition to the full global service from our postal-based generic address partners. We continue expanding with up to three new local providers each month.

 

Let’s consider briefly what that Russian opportunity represents for eCommerce, then we’ll highlight the specific challenges of transliteration, and finally we’ll share a little more about this partner and why we chose them.

 

The Russia Opportunity for eCommerce

 

There’s something about companies that lean in to promising growth opportunities even when the headwinds are strong. They take on some risks, sure, but if everyone else goes away than they also stand to make all the gains.

 

We’ve been seeing elements of this in Russia over the past year. There’s no question the country has promising growth prospects for cross-border commerce. According the The Paypers, Russians buy over US$16.5 billion in eCommerce goods each year, and that amount is compounding at nearly 20 percent year over year 1. Yet with all the uncertainty there (slide in oil prices, rampant inflation, military action in Ukraine and pockets of civil unrest), many Western companies have pulled back investments. They haven’t had the appetite for all the near-term risk.

 

But other companies have taken the lean-in approach, doubling down in Russia because they believe the opportunities there trump today’s risk. A recent report by China Securities Journal says that eCommerce firms like Alibaba and Taobao have taken advantage of Western firms pulling back to grab 70% of Russia’s annual US$3.5 billion cross-border spend. 2
As Russia stabilizes, will it be too late to win back market share from the Chinese eCommerce giants? For the companies now pulling back, the long-term risk seems to be missing out on the chance to build deep relationships with Russian consumers. One you concede that, it can be very hard to get it back.

 

The company OZON.ru gets the lean-in mentality better than most. Under the guidance of its French CEO, Maelle Gavet, OZON has been relentless about grabbing market share in Russia. Guided by her belief that the country will ultimately have one hegemonic eCommerce platform (like Amazon in the US, Alibaba in China or Mercado Libre in Latin America), Gavet has consistently invested for aggressive growth irrespective of Russia’s economic climate. While Amazon and eBay have dabbled a bit when the business cycle was at its best (but retrenched as the economy soured), OZON keeps plowing capital into inventory, warehouses, payment systems and its own courier service for distribution. 3

 

For Western eCommerce businesses to have a chance in Russia – be they platforms, individual merchants or all players in between – they have to find ways to invest now. Even as conditions seem so volatile for cross-border trade.

 

GDC has taken a lean-in approach to Russia. To help our clients gain a toehold in this important market, we’ve invested both in this address partner and in the technology necessary to support complex transliteration from Latin script alphabets to Cyrillic. We’ll turn now to a brief overview of that challenge and how it allows us to fill the gaps in Russian coverage left by the major global generic address systems.

 

The Challenge of Cyrillic

 

The transliteration and transcription challenges are tough, and that’s a dirty secret global address solutions don’t like to talk about.

 

It’s hard enough to move among all the languages that use the Latin script alphabets, but at least the letters stay the same. The bulk of the work is in creating ways to cross-walk, for example, the English word “street” to the German word “strasse.” You create the transcription elements, you program rules to cover the occasional diacritics issue, and then you fine-tune the logic to make sure the output presents in the ways locals expect to see it. That’s oversimplifying, of course, but it captures the basic idea. When you run into problems, it’s pretty easy to find solutions.

 

But when you’re dealing in different alphabets, the challenges are compounded. You can’t even transcribe until you’ve transliterated. For example, when someone inputs the Latin version of “Moscow,” you have to transcribe it to “Moskva” and then transliterate it from Latin to the Cyrillic script. The same is true for all elements of the address like the country names in the Russian Federation, the region names, the cities and villages, and all the streets. Now add to that abbreviations, short-hand and common misspellings.

 

There’s a lot to account for going from Latin to Cyrillic and back again, and it’s anything but a precise science. But if you’re creating an address intelligence service for clients looking to expand their business into Russia, you must invest in doing this.

 

Again, it’s tough. But Russia is an important trade lane and presents a lot of growth opportunity for eCommerce. Our Worldview clients have told us they want it, and so we’ve leaned in, making the investment both in finding the right Russian in-country partner and in developing a transliteration engine to move the addresses smoothly between Latin and Cyrillic.

 

About Our Russian Partner

 

Finally, a little about our Russian partner. While we provide our clients with access to generic global address verification through our Worldview API, we recognize the significant gaps in these generic services. So our model is to go into key countries, identify companies that provide best available address intelligence for those markets, and test the in-country providers against the generics. If the in-country providers demonstrate significant “lift” over the generics, we start the process of making them available through Worldview.

 

Country by country, we are filling in the gaps left by generic services. As we mentioned before, we have 35 best in-country partners now, and are expanding that number by integrating three new countries a month.

 

We found our Russian partner after a lot of searching. The company has spent over 10 years building and refining their data sets and business logic, and they has earned the trust of Russia’s largest companies in banking, insurance and retail. When they need to send parcels or critical documents to Russian businesses or homes, they first verify their addresses through this service.

 

They offer wider coverage of Russia than the generics, both in terms of geography and population. They pull data from a wide range of sources, spreading beyond postal and mapping data used by most generics. They offer sophisticated business logic for verifying and enriching Russian addresses. And they refresh the data frequently to ensure it’s as up to date as possible.

 

Most importantly, they offer that “lift” over generic services when it comes to Russian addresses, qualifying them to be part of Worldview.

 

So, we welcome our new Russian partner into the Global Data Consortium. We’re excited to open up access to Russia for Worldview customers. And if you’re looking for help in Russia, or any other country in our global platform, give us a call. We’d love to help expand your Worldview.

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GDC’s Integrates New India Address Partner into Worldview

This month GDC welcomed to the consortium a best in-country address validation solution for India, an exciting addition to the Worldview global platform. India is the world’s second largest country in terms of population, its consumer class is growing by leaps and bounds, and rising income is creating an appetite for eCommerce goods. Internet orders are literally doubling every few months. According to Morgan Stanley estimates, Indian online sales will grow from US$3 billion in 2013 to US$100 billion in 2020.

But its address infrastructure is notoriously under-developed, and this creates massive headaches for eCommerce companies that want to ship products to Indian customers. They’re afraid of the risk that comes with the unreliable address services they get from the generic global verification systems (a topic we covered in detail in my Open Letter last month). They want to sell their goods to this massive consumer class in India, but they’re hesitating because of the costs that come when you can’t verify addresses with confidence. Like mis-deliveries, ship-backs, lost shipments, credit card chargebacks, and frustrated customers, to name a few.

That’s why we’re excited to offer this new data partner in India. As a Mumbai-based business, it’s a truly LOCAL solution providing LOCAL intelligence. The company has enriched India Post address data by layering in alternative sources and adding business logic that helps resolve the most common address mistakes. Our own tests of their data demonstrates significant lift over what’s offered in the major generic global systems. And they are constantly refreshing the information to keep ahead of the quick pace of construction as India’s economy keeps building new homes and apartments and demolishing old ones.

In particular, this partner is able to provide more granular delivery details in more cities, suburbs, and villages. While the generic global systems rarely provide verification below the city or post code level, this partner is able to verify many more addresses to the street, premise or even delivery point level.

This is what LOCAL address solutions do, and it makes a big difference to eCommerce businesses (both the big platforms and the individual merchants) seeking growth in the Indian market. Let me explain…

The India Address and Delivery Challenge

Last month Wall Street Journal reporter Sean McLain shadowed two motorcycle deliverymen as they hauled eCommerce goods through the streets of some of India’s largest cities. One worked for Flipkart, an enormous Bangalore-based online marketplace, and the other for Amazon.

Each would pile as much as 150 pounds into their backpacks and fan out through the cities, suburbs and villages to deliver such sundry goods as laser printers, coffee makers and six-packs of Coca-Cola. They’re expected to make at least 45 deliveries each day, but the address infrastructure in India makes this no easy task.

Delhi, for example, is a city of nearly 17 million people. Addresses are a combination of neighborhood names, block numbers and house numbers. Many house numbers aren’t even arranged sequentially along a street. Three houses in a row might skip from 225 to 657 and back to 301. The complexity of it means deliverymen spend a lot of time asking for directions. When following the Amazon driver, the

reporter noted that each delivery “involved at least four stops to ask cycle-rickshaw drivers, security guards or roadside barbers for directions. Each time the response was the same: an outstretched finger and a one-word answer: ‘Straight.'”

Neither Amazon nor Flipkart trust India Post or other traditional delivery services to get their parcels to customers. They’re investing huge sums of cash to build their own delivery infrastructure. This is how desperate they are to build local intelligence to make sure packages arrive on customer’s doorsteps quickly. Even then, it’s all terribly inefficient.

There’s a better way.

The Difference in LOCAL Intelligence for Address Verification

Even though they want to expand their businesses into India, eCommerce merchants are wary of the address and delivery challenge. Generic global address services aren’t helping. In most of India they can only verify addresses to city or district level. Think about what that means. They expect you to ship products – potentially expensive products – to an address about which they can tell you nothing more than “we know the city exists.” It means you have to ship first and then hope the deliverymen figure out the neighborhood, street and house number portions of the address. That creates too much uncertainty for merchants.

With our new data partner in India, GDC is able to flip that equation around. Rather than sending the package and hoping the deliveryman’s local knowledge is sufficient to find the address, we use our partner’s local intelligence to provide address detail to the street, premise and delivery point levels. We can also tell you if an address is not deliverable. It’s like having the local deliveryman in Delhi tell you the address exists before you ever ship the package.

For eCommerce merchants holding back from the Indian market, this should give you reason to reconsider. There’s a massive growth opportunity there, and in using our local intelligence for address verification, you can be confident your parcel will arrive even when you’re using local delivery services.

For the big eCommerce platforms – even those that have invested so heavily in these armies of motorcycle deliverymen – there’s an opportunity for you, too. With this local intelligence for address verification, you can stage your orders for more efficient delivery. If the goal is 45 packages a day per deliveryman, imagine how much throughput you could get if he started with better address information…if he didn’t have to stop four times to ask directions for each package!

So, we welcome our new India partner into the Global Data Consortium. We’re excited to open up access to India for Worldview customers. And if you’re looking for help in India, or any other country in our global platform, give us a call. We’d love to help expand your Worldview.

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Post-Script – The Innovator’s Dilemma and Local Disruption

I recently published an open letter to the address verification industry, a group to which I’ve belonged professionally for over 20 years. In it, I critiqued our lack of innovation over the years and suggested another way: making global address verification better by using local intelligence.

As hoped, the letter spurred a lot of interesting dialogue. In hopes to keep the conversation going, I’m posting a series of blog entries that dig deeper into the themes of technology, address data and how we can meet the needs of our most demanding customers.

Part I: History Lessons

Part II: A Fateful Trip to Brazil and My “Eureka!” Moment

Part III: Making Local Intelligence a Reality in Global Address Verification

Part IV: Post-Script – The Innovator’s Dilemma and Local Disruption

In 1997, Harvard Business School professor Clayton Christensen published his landmark book, The Innovator’s Dilemma. His guiding questions: why is it that innovation always seems to come with disruption? True innovation rarely comes from market leaders with established products. It always comes from an upstart with little to lose and a scrappy mentality.

The minicomputer didn’t come from IBM, Christensen instructs us, though IBM had the deep pockets, experienced sales force, and engineering know-how to make it happen. No, IBM kept clinging to the profits from its dominant mainframe technology before Digital Equipment Corporation (and a host of other upstarts) swooped in and launched the better, faster, cheaper alternative.

History will show the global address verification market is going through a similar disruption.

On the surface, it’s baffling that the older global address companies aren’t pushing local intelligence into the verification process. The new model makes so much more sense. But looking at it through Christensen’s innovator’s dilemma lens, we can begin to understand why. They’re captive to their own success; to the demands of their big customers. Rather than look to the future of our industry – the rise of cross-border commerce, increasing parcel shipment, and consumers demanding ever faster delivery – they remain focused on protecting what they have.

It’s a hard cycle to break.

They aren’t doing it, and I don’t expect that to change. What I do expect is that Global Data Consortium continues leaning into this new and developing market. We will build a critical mass of data partners providing best in-country solutions; we will help our partners continue improving their data through faster feedback loops; and we will make our services less expensive with time (though, perhaps surprisingly, it’s already price competitive with the major global generics).

This is the way of disruption. Quality keeps getting better, prices keep coming down, and eventually even the most price-sensitive customers want the better service.

Five years from now I predict that most of the market has shifted to this model. We will no longer accept “good enough is good enough.” We’ll demand innovations that move local intelligence (that’s so rich at the delivery level) upstream to the address verification process. Rather than depend on local intelligence to fix it, our local data will prevent the problems that lead to mis-delivery and delays.

That’s when we can say the local disruption has truly taken hold. That’s the future that I want GDC to be part of.