Understanding Current MERLIN Process vs Proposed Census Method Process Move Update Training Understanding Current MERLIN Process vs Proposed Census Method Process May/June/July 2017

Agenda Move Update Overview Move Update Requirements Move Update Methods Move Update 99% Accuracy and Legal Restraint Move Update Exceptions Current MERLIN Sampling *Proposed Address Quality Census Measurement Move Update Status Questions

Move Update Overview Nearly 40+ million people change their address each year By keeping mailing address lists current mailers can… Continue to reach their customers after they move Significantly reduce the loss of time, effort and money due to undeliverable mail Did you know that nearly 40 Million people change their addresses each year? That’s equivalent to approximately 12% of the United States Population! Many of them are customers whom the mailers value. If the mailers want to keep these customers, they need to make sure their mail reaches the customers by keeping the mailing lists up-to-date. The USPS Move Update is designed for just this purpose! It allows mailers to keep their mailing addresses current, which ultimately leads to customer retention. From the Postal Service perspective, Move Update is critically important for operational purposes. Massive amounts of undeliverable and discarded mail put a strain on the Postal Service. This strain translates to needless expense and inefficiency. Move Update is designed to dramatically reduce this waste by improving the quality of mail distribution lists. In short….Move Update standards benefit the mailers, the customers, and the Postal Service! Source: MelissaData.com

Move Update Overview Move Update Standard Used to reduce number of mailpieces that require forwarding or return by periodically match mailer's address records with COA orders maintained by USPS

Move Update Requirements First-Class Mail presorted or automation prices First-Class Package Service presorted parcel prices Parcel Select® Lightweight Prices All USPS Marketing Mail Mailers who present mixed mailings that pertain to at least one of these categories are still subjected to the Move Update standard Mailers must reconcile their mailing address list within 95 days prior to the postage statement finalization date with one of the Postal Service-approved methods or a surcharge is assessed

Move Update Methods To meet the Move Update standard, mailers must use at least one of the USPS approved methods Pre Mailing: updating mailing address list before you mail NCOALink National Change of Address Link Verifies a mailer submitted mailing address list against the USPS NCOA database NCOALink MPE National Change of Address Link Mail Processing Equipment Uses Mail Processing Equipment (MPE) technologies to match the printed address from a mailpiece against the NCOA Database Post mailing: updating mailing address list after you mail ASE Ancillary Service Endorsements Allows mailers to receive COA information via hardcopy notice provided by USPS Mailer must print an endorsement on a mailpiece ACS Address Change Service Allows mailers to receive COA information and other reasons for non-delivery electronically

NCOALink USPS approved pre-mailing address correction service that verifies a mailer submitted mailing address list against the USPS NCOA database Before NCOALink After NCOALink The first primary method that we will examine is National Change of Address Link, or NCOALink. NCOALink is an USPS approved pre-mailing address correction service that verifies a mailer submitted mailing address list against the USPS National Change of Address (NCOA) database. NCOALink is considered the best and most effective method to comply with the Move Update Standard because the service can identify and correct the mailing address before mailing, avoiding undeliverable mail beforehand. In addition, NCOALink is applicable for all mail classes.

MPE Sprays new barcode onto the physical mailpiece NCOALink MPE Subset of NCOALink that uses Mail Processing Equipment technologies to match the printed address from a mailpiece against the NCOA Database MPE Sprays new barcode onto the physical mailpiece Before NCOALink MPE After NCOALink MPE The National Change of Address Link Mail Processing Equipment, or NCOALink MPE, is a second Move Update method and is a subset of NCOALink. This product uses Mail Processing Equipment technologies to match the printed address from a mailpiece against the National Change of Address Database and to update the address by printing the change-of-address barcode directly on the mailpiece. The graphic depicts the before-and-after state of a mailpiece that is submitted through NCOALink MPE. Keep in mind that NCOALink MPE is not a common Move Update method; typically, larger mailers using barcode readers and optical character readers use this method. NCOALink MPE requires mailers to submit physical mailings, where the new address barcode is sprayed on the mailpiece when a change-of-address record is identified in the NCOA database. Reports on change-of-address information are available upon request for the mail owners.

Ancillary Service Endorsement (ASE) Post-mailing service that allows mailers to receive COA information via hardcopy notice provided by USPS Mailer must print an endorsement on a mailpiece Mailpiece disposition depends on the following endorsement options: Address Service Requested Return Service Requested Change Service Requested For First Class Mail, this endorsement cannot be used as a stand-alone method to comply with Move Update Temp-Return Service Requested For Standard Mail, this endorsement is not available A third method for satisfying the Move Update standard is Ancillary Service Endorsement, or ASE. ASE is a post-mailing service that allows mailers to receive change-of-address or reason for nondelivery information via hardcopy notice provided by USPS if the mailer prints an endorsement on a mailpiece. Because physical copy of the change-of-address information involves manual labor, Ancillary Service Endorsement is considered to be the “low-tech” method. Therefore, it is advised to use Ancillary Service Endorsement as a last option to comply with Move Update. If a mailpiece is undeliverable, USPS will forward, return or dispose the mailpiece depending on the choice of endorsement. There are four endorsement options under ASE which the mailers may use: Address Service Requested, Return Service Requested, Change Service Requested, and Temp-Return Service Requested. Additional fees may apply to certain endorsements. Mailers using “Temp-Return Service Requested” endorsement should understand the option is not available for Standard Mail to comply with Move Update. Furthermore, “Change Service Requested” endorsement cannot be used as a stand-alone method to comply with Move Update; instead, this endorsement must be used in conjunction with Address Change Service method, which will be discussed later in the training.

Address Correction Service (ACS) Post-mailing address correction service that allows mailers to receive COA information and other reasons for non-delivery electronically Four service options: Traditional OneCode Full-Service** Intelligent Mail Package Barcode (IMpb) **FREE Service for Full-Service Mailers The fourth and final method for satisfying the Move Update standard is Address Change Service, or ACS. ACS is a post-mailing address correction service that allows mailers to receive change-of-address (COA) information and other reasons for non-delivery electronically. Think of Address Change Service as an electronic, automated version of the Ancillary Service Endorsement. Mailers have four distinct versions of the ACS service at their disposal to receive address corrections and to instruct the Postal Service on how to handle their undeliverable mail: Traditional, OneCode, Full-Service and Intelligent Mail Package Barcode. Address Change Services can and in most cases must be combined with Ancillary Service Endorsement. Details will be expanded upon in the next slide. Using ACS does not guarantee that it will eliminate all hardcopy or manual notices a mailer may receive. There are a number of cases when a manual or hardcopy notification will be provided, even when the mailer uses ACS. In general, however, ACS will reduce the costs associated with manually updating address files for changes of address. Note that Full-Service ACS is available free of charge for qualifying Full Service mailers.

Move Update 99% Accuracy and Legal Restraint While the four methods described in the previous section are the primary methods that a Mailer should use to satisfy Move Update requirements, there are two alternative methods for compliance that are available under very limited circumstances – 99 Percent Accuracy and Legal Restraint. Some mailers assert that their customers diligently notify them of address changes, making their address lists as accurate as possible. They believe that the Postal Service Move Update methods are unnecessary and add no value to their mailings. Under these circumstances, mailers who can demonstrate that their internal list management maintains address quality at 99 percent or greater accuracy for changes of address may be authorized to comply with the Move Update standard through the 99% Accuracy Method. To use the 99 percent Accuracy method, applicants must first complete and return the 99 percent Mailer Move Update Processing Order Form along with a copy of the completed PS Form 3553. Mailers of First-Class Mail and First-Class Package Service pieces who assert they are restricted by law from incorporating Postal Service COA information onto their mailpieces without permission from addressees may request NCSC approval to meet their Move Update standard using the Legal Restraint method. To qualify for Legal Restraint exemption, mailers must identify by citation the specific legal restriction, including copies of the statues or regulations that prohibit the immediate use of change-of-address information from a primary method of Move Update compliance. It is important to note that both alternative methods require that the mailer receive formal approval from the USPS National Customer Support Center, or NCSC, prior to using the alternative method. Available to mailers who can demonstrate they have a highly effective method of keeping their addresses current **Note: Mailers must obtain an approval letter from the NCSC to be eligible for an alternative method When a legal restriction prevents mailers from updating their customer’s address without direct contact from the customer, they can be authorized to use the Legal Restraint Method Two alternatives for meeting the USPS move update standard

Exceptional Addresses Move Update Exceptions Two exceptions to Move Update methods Exception 1 Mailpieces that use an alternative address format, which have the recipient listed as: Simplified addresses “Postal Customer”, “Residential Customer”, “Business Customer” Occupant Addresses “Occupant”, “Householder”, “Resident” Exceptional Addresses “Jane Doe or Current Resident”, “Jane Doe or Current Occupant” Exception 2 Mailers may directly acquire current addresses from their customers Example Address Jane Doe 2711 ORDWAY ST NW APT 204 WASHINGTON DC 20008-5036

Move Update Validation: Current MERLIN Process Move Update validations are performed based on a sampling at the job level on Mail Evaluation Readability Lookup Instrument (MERLIN) Mailers are assessed additional postage on pieces not meeting the Move Update requirements above threshold Assessment process Step 1: Mailpieces are randomly sampled. Step 2: Sampled mailpieces go through Merlin Machine. Step 3: Merlin assess address list quality with the sampled mailpieces against COA records. Step 4: Merlin generates report based on assessment. NCOA Database

Move Update Validation: Proposed Census Process Address Quality Census Measurement and Assessment Process (Census Process) Assess errors as mail is processed through the mail stream by using data collected from Mail Processing Equipment Would replace traditional MERLIN Move Update methods for mailers submitting Full-Service volume Census Process and Assessment Process Move to census-based verification Results shown in Mailer Scorecard Applies to ANY eDoc Submitter w/ FS volume the month after first mailing full-service Free ACS for basic automation/Non-automation (95% FS volume) Updated process for monitoring FS volume Quarterly monitoring of FS volume for mailers receiving free ACS on basic pieces If FS volume drops < 95% for a given quarter, mailer will be removed from free ACS in next billing cycle Mailer will be reenrolled if 95% threshold is met in subsequent month Pending PRC Approval Requirements for free ACS: above 95% at eDoc submitter level, unique barcode included in eDoc, One Code or FS ACS requested STID, proper By/For identification.

Move Update Validation: Proposed Census Assessment Process Step 1: Mailpieces go through Mail Processing equipment (MPE) Step 2: MPE scans the address info on a mailpiece and compares against COA records Step 3: Move Update compliance metric is available on Mailer Scorecard NCOA Database

Move Update Census Process: Mailer Scorecard Mailer Scorecard contains Move Update compliance metric, which the tolerance is currently set to be 0.5% Typically, mailers who do not use an USPS approved Move Update method will encounter this error In the future, USPS will assess a charge of $0.08* per mailpiece in error beyond the 0.5% threshold *Pending PRC approval

Move Update Census Process: Mailer Scorecard Click on Mailer Name or Mailer CRID Click Move/Update Errors radio button Click on Run Report

Move Update Census Process: Mailer Scorecard 4. Click on Error Type or Error Code link for Job Level Details 5. Click on Error Type or Error Code link to get to Piece Level Detail

Move Update Census Process: Mailer Scorecard 6. Detailed Piece Level Error details populate 7. Error Description/Error Data/ and Resolution Action appear to assist in diagnosing and correcting errors.

Move Update Status Move Update Census Method is a proposed method Any Move Update failures from MERLIN need to be assessed at the time of mailing Move Update Metric on the Mailer Scorecard Information Only Ready for Mailers to use and evaluate their Move Update process

QUESTIONS?