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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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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.

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Making Local Intelligence a Reality in Global Address Verification

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

In 2010, on a long plane ride back from Brazil, my mind was racing with ideas. Two years prior, an eCommerce executive had challenged me (read that story here) to solve the last mile problem of global address verification. In his world, every package had to be delivered and as quickly as possible. He couldn’t afford to ship to bad addresses, but existing global address verification systems weren’t reliable enough. They depended too much on local delivery intelligence to fix address mistakes. His criticism stung because I was COO of one of those businesses, but I knew he was right.

I had gone to Brazil to ask its postal operator, Correios, to give my company an update to its address database. That had not worked, but in a stroke of serendipity, I met the owner of a business that maintained more complete address data than Correios and that refreshed its addresses constantly. (See that story here.)

This was exactly what the eCommerce executive had been asking for! And if it existed in Brazil, there must be similar services in other countries. I began talking with my colleague (and eventual co-founder) about creating a better global address verification system; one that used the local intelligence of best in-country sources of data; one that kept up with the constant changes of addresses by constantly refreshing its data. If we could build access to a network of these data sources, we could create an entirely new (and more reliable) model for global address verification.

If we could build something that met the lofty requirements of eCommerce, where every package counts and there’s no margin of error for bad addresses, we could also help the companies on which the eCommerce industry leans for help (logistics, fulfillment and delivery). We could help data cleansing services that need more reliable results than the older global address systems provided. Perhaps we could even help software companies that do mapping and navigation based on addresses.

I began sketching the blueprint for a company based on these ideas. It would be complicated, no doubt. We would have to…

  1. Identify the Right Partners and Build Relationships

Just as the best address provider in Brazil had been hard to find (really, there was no small element of luck that I met him on that trip!), so would its counterparts in other countries. I would have to rely heavily on my network of friends in the address data industry to identify the right partners.

And I would need to keep my passport up-to-date…this would not be a job I could do while sitting behind a desk. I was going to need to spend a lot of time traveling to meet data providers, vetting them face-to-face to establish trust and to feel confident they play by all the right rules in collecting and sharing their data.

  1. Test to Verify

Most data providers say they’re the best, so frequent testing was going to be critical to finding the actual best in-country partners. We would need to create clear testing parameters to demonstrate these companies provided more reliable address results than postal operators.

  1. Build Sophisticated Technology

Finally (and it almost seems funny that this comes third), we would have to invest in a robust cloud-based technology platform for integrating with our data partners and providing our customers with a single place to access the world’s best address data. This would be the only way to take full advantage of their refresh cycles (the feedback loops that keeps their address data current).

This was the basic blueprint, and later that year my partner Charles and I formed the Global Data Consortium. In the five years since, we’ve been executing on the plan, step-by-step. I flew around the world finding the best data providers for key countries. I developed friendships that turned into trusted partnerships. We tested everyone’s data to verify its quality and reliability. And we developed the GDC Worldview product – an API management engine and data validation platform – to provide our customers a single point of access to the world’s most reliable address data.

We’ve come a long way since Brazil! Worldview now has over 30 countries covered by best in-country partners, and we’re adding up to four new ones each month.

It’s a solid start, and we keep investing in Worldview to make it better for our existing customers and anyone for whom the old global address systems just aren’t good enough.

Here’s my challenge to consumers of global address verification services: If you’ve found that the generic systems aren’t providing the results you want; if bad address information is leading to mis-delivery or slow delivery; if your service isn’t formatting addresses in the way your global customers expect to see them…there’s no reason to be captive to “good enough.” You can do better.

If that describes you, let’s talk. Let’s set up a test to see how our best in-country data partners use their local intelligence to fix problems before a package ever ships.

Let us improve your world view.

Next: My final thoughts in this blog series…The innovator’s dilemma and predicting the future of the global address verification industry.

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

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

In 2010 my address verification company was having trouble with Brazil’s postal operator, Correios. For ten years they had refused to provide updates of their address data to foreign businesses.

For the past 50 years building a global address database meant a company (like mine at the time) had to gather information from the world’s various postal agencies. Since addresses are in a state of constant flux (new apartments going up, old buildings torn down, office spaces partitioned into suites, etc.), we took updates once or twice a year in an attempt to keep up with the changes. Think of it like a subscription to the old encyclopedia Britannica: you would pay them to send a replacement volume periodically so your research information didn’t get too dated. Bi-annual updates were the norm. Waiting ten years, however, meant our Brazilian data was desperately outdated.

For years I had tried to break this logjam with Correios to no avail. Finally, I decided it was time to take action. I flew to Brazil one week that summer, hoping that being in country would convince them to finally meet with me.

Alas, no. They weren’t budging, and they had no interest in talking with me. But all was not lost. Rather than sitting in my Sao Paulo hotel room, I made a sales call on a direct mail marketing company. The owner and I hit it off and spent most of a day together. I explained to him my frustration with Correios. He laughed, telling me he had no problems getting updates. Then he hesitated, got a quizzical look on his face and asked me, “But why would you want their address data. It’s garbage. You should use mine instead.”

He explained further: Like most postal agencies, Correios was not very good at keeping track of its addresses. This entrepreneur had discovered that fact years ago as he started building his company. He saw an opportunity to make a reputation for himself as having the best address data in the country. Having the most accurate addresses meant more of his mailers would be delivered by the postal carriers accurately and more quickly (no need to rely on the local delivery person to fix your mistakes). This would be a competitive advantage against other direct marketing businesses.

So he built his own database, taking Correios addresses (which, because he was a Brazilian, they would update at normal intervals) and enriching it with his own efforts. He created an information network throughout Brazil, ensuring he would get notice of new and changed addresses. If a new apartment complex was coming online in Brasilia, he collected that information and made the updates. In places where data was particularly hard to get, he literally hired people to walk the street and gather address information themselves. He even created an immediate feedback loop to correct bad addresses: When an envelope was returned as undeliverable, his people would quickly update the database.

Most impressive of all, he created enhanced postal rules to account for local nuances and expectation. If a Rio de Janeiro neighborhood called itself by a name not recognized by Correios, say for vanity reasons, his system caught that and during verification would suggest a change more likely to get the mail delivered quickly and in a format the recipient expected to see.

As a result of his innovations, he had created a competitive advantage for his business. It was thriving. Other businesses needing accurate Brazilian addresses were seeking his help. Courier services, utility companies, even retail stores (who needed better address verification in order to extend credit to people living in the working-class favelas). Correios addresses weren’t good enough, and my new friend had established himself as the superior alternative.

While he had focused exclusively on serving domestic Brazilian companies with his address solution, he was open to finding a way to help me solve my Correios problem.

This was my “Eureka!” moment. This business had found a way to incorporate local intelligence into the address verification process, and he had feedback loops in place that guaranteed rapid data refreshes. If going through Correios was like subscribing to the encyclopedia Britannica, going through him was like having a team of experts building a maintaining our own personal Wikipedia for addresses.

If this worked in Brazil, there must be similar services in other major countries. And if I could find a way to bring it all together on a single technology platform, we could solve that eCommerce cross-border problem. We could bring local intelligence into the address verification process.

Next: We create the blueprint for the Global Data Consortium and begin building Worldview.

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Local Intelligence in Global Address Verification: History Lessons

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.

History Lessons

Let’s start with some of the history that made me aware of the problems we have in the address verification industry.

In 2008 I received a call from an executive with a prominent eCommerce company. He had been piloting a cross-border initiative in which customers from other countries could order from his website and he would ship their products directly from a U.S. distribution facility.

The experiment was not going well, he told me. Deliveries were getting lost, shipped back, or just taking longer to arrive than he (or the customer) expected. The problems stemmed from addresses. “Could you help me?” he asked.

I had worked in the address data industry for 15 years at that point and was currently Chief Operating Officer for a leading provider of generic global address verification services. We had accumulated a massive database of addresses which we licensed mostly from national postal operators. It covered 240 countries and territories. We solved the very problems the eCommerce executive was describing. Or at least we thought we did.

I asked him to send me some address files, and I’d have my team run them against our database.

When the results came back, I was pleased. We had cleaned up his files nicely and our analysis said he could confidently ship his packages to nearly every address. But when I called him back to share what I thought was good news, he just sighed.

“No, this won’t do at all,” he told me. “You’re quick to tell me to ship, but I happen to know these addresses are incomplete. You’re asking me to put my packages into the postal stream and trust that the local infrastructure to do the dirty work to get it delivered.”

He had conducted the same test with other “generic” global address services, and they all came back the same. As hard as I tried, I didn’t have a good response to his points.

“When you figure out how to solve that last mile problem before I ship,” he concluded, “give me a call. But for now what you have just isn’t good enough.”

His criticism stung, but it wasn’t entirely unfair or inaccurate. Since the dawn of our industry in the 1960’s, we global generic address companies had struck a Faustian bargain with our primary customers – direct mail businesses and the vendors that provided them support. If we could supply them a good enough service for a cheap enough price, the bargain went, they would license our address data. But if we raised the price for any reason, they would just stop using us.

It sounded brutal (and it was), but it made sense for the problem they wanted us to help solve. They sent mailers en masse. These were inexpensive cards and envelopes that often went out in batches of many thousands at a time. It often didn’t matter if some percent of them didn’t get delivered. It was a volume game with everyone operating on tiny margins. Our job was not to get every envelope delivered. It was more of an actuarial calculation: if they could use us to cull out some small percentage of the bad addresses, the pennies they spent on us would save them at least that much in postage costs.

And then we had our dirty secret: our False-Positive Bias. If we could verify an address to a locality level, confirming, for example, that the street existed even if the number was wrong – we would call the result reliable and advise the customer to send it.

Why?

Because we knew most countries have impressive last mile delivery infrastructures. If you can get mail to the locality level, the people in the post office were really good at fixing your mistakes and getting the letter where it needed to go. It would take longer to get there because it had to go through exception processing, but the direct mail customers were generally okay with that. As long as the right percentage got through and our prices stayed low enough, the Faustian bargain held.

At the time the eCommerce executive contacted me, over 70 percent of our revenue came from customers related to direct mail. We were beholden to their requirements, and to be candid, we weren’t making very high margins ourselves. This was not exactly an environment conducive to innovation.

Without investing in a lot of improvements, we were never going to be good enough to satisfy the eCommerce industry’s needs. Their requirements were based on precision and spend – they expected every package to be delivered…and quickly! Mis-delivery cost them shipping and product losses and slow delivery cost them customers. The “good enough” approach that defined the generic global address industry – that False-Positive Bias – wouldn’t cut it.

For the next couple years I watched eCommerce trends closely. I saw cross-border shipping accelerate, growing rapidly quarter over quarter even while the address problem persisted. They hadn’t yet found good alternatives to meet their needs.

There is an opportunity here to do something useful, I remember thinking to myself, if only we can find a way to take the local intelligence that’s so good in delivery and apply it earlier in the chain of events for shipping packages. We needed to find a way to apply local intelligence in the address verification process. Before a package ever leaves the warehouse.

Two years later, during a trip to Brazil, I finally saw a way forward. More on that in my next post.

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Why Local is Better with International Address Verification

International address verification has a lot of applications, from ensuring the timely delivery of items to standardizing data in your CRM to giving drivers accurate directions when they’re using your mapping apps.

In every case, a localized country engine will always be better than a generic address solution. I’ve been having a lot of conversations on this topic recently, and three major reasons keep coming up on why local is better.

There are three defined reasons why a localized country engine will produce better results. A localized country solution will return results based on the perspective of the country or better said the results will correspond to user expectations. Depth of coverage by a local country engine tends to reduce inaccurate False Positive results as typically produced by generalized address verification engines. A local engine will also have a much stronger feedback dynamic for correction of errors and omission associated with address output results.

  1. User Perspective

User perspective is a fuzzy term to use here, but it’s important that we don’t lose perspective of the end user – the consumer – who actually makes final use of our address data.

An address output from any engine should look like the format of the country the address represents. In the United States, the typical format is Building Number, Street Name, Apt or Suite Info followed by City, State and Zip Code. Many other countries follow a format that begins with Street Name then Building number and then followed by other information.

Additionally if the address is a Japanese, Russian or other similar type address, representing it in Latin script characters will create some level of interpretation requirement by a local delivery representative or customer service agent who doesn’t have familiarity with non-local language and address formats.

Does this matter? Yes! The user perspective, the way they read and interpret the address on their package, parcel or in their map app matters. As I’ve witnessed recently with an invoice sent to my office, a letter whose address isn’t formatted to country standards often get delayed in delivery because it gets pushed into the exception processing queues in various postal sorting facilities. It requires postal workers to touch it, look at it, and make human decisions about where it gets delivered. That always spells delay.

Another example to consider on user perspective: In Finlandaddresses are denoted in both Finnish and Swedish. Depending on the nationality of the resident, misrepresenting a mailing address on a piece of correspondence (such as a hotel loyalty program marketing piece) affects perception of the sender. Google experienced this issue firsthand when it provided Finnish street address information in Google Maps that was in Swedish versus dual language representation (https://productforums.google.com/forum/#!topic/maps/BtdWUJs1wpI[1-25-false]). Google was quick to correct the problem, but not before they generated some serious bad blood amongst users by not fully understanding the nuances of Finnish-Swedish culture.

They didn’t appreciate the importance of user perspective in presenting addresses. If they had been using an address engine that incorporated local rules and sensibilities, this never would have been a problem.

  1. Depth of Coverage and False Positives

Depth of coverage is a significant issue for the output results produced by many generic address verification engines. Most systems are only able to verify that a street may exist within a city and thus an address is more likely to be Deliverable and thus they label it “Correct.” This is a fallacy known as a false positive result.

A local country engine leverages a greater depth of coverage in the form of more data along with rules that reflect a greater understanding of local deliverability standards. More data means the ability to verify whether a building/house number exists on the street and whether there is enough information within the address to truly locate the address. This deeper level of detail reduces the risk of the false positive.

Take Toronto’s Yonge Street as an example. Yonge Street has been called the world’s longest street. While not accurate, itis over 50 kilometers long. Were a parcel addressed solely with a name, Yonge Street and a Toronto zip code is it likely to be truly deliverable? Not likely. But a generic address engine would likely give it that “Correct” label.

Would you want to chance an expensive parcel or important document to it being enough information?

Having more data and knowledge about the region you cover – as local data sources naturally do – ensures a better interpretation of the output information. It reduces this problem with false positives and thereby increases deliverability rates.

  1. Feedback Dynamics

Local country engines tend to be 100% focused on customers/users from the same local market. That’s the secret to their success. They create address engines that are much more specific than the generic alternatives.

Why? Because their business is about producing the most accurate data that, for example, can be sold to direct marketing mailers that need assurance that their brochure is actually getting to the reader. Or to the courier who must get a package to its final delivery point. These are their primary customers, and in building address data to serve them, it’s just much more reliable.

Let’s not forget the power of the feedback loop. Customers of the local address engines are also providing constant feedback about the accuracy of the local provider’s outputs. This is a great resource base for constantly improving the output results. Reliability is baked in.

Globalized generic solutions that don’t have a strong customer/user footprint in local markets don’t benefit from this same user feedback loop. That just can’t iterate improvements at the same rate as a local provider that’s directly accountable to its clients for results.

So there you have it – User Perspective, Depth of Coverage, Local Feedback Loops – the variables that best define why local sources of data is so much better when it comes to international address verification. They help to generate a more ACCURATE address output result and thus a BETTER result for users whether locally or globally located.

Global Data Consortium’s Worldview platform provides access to over 27 local country engines for address verification worldwide. We are adding solutions at a rate of 3-4 per month and expect to have coverage for over 40 countries and regions before the end of the year. Whether it is Mexico, Brazil, Poland, Spain, Italy, Australia, Finland or The Czech Republic, GDC can help provide you with a more ACCURATE address result in addition to other international results such as Identity verification. Create a BETTER Customer experience. Try Worldview and See More Clearly.