Circulation Planning - Part 1... What You Should Know About the Merge

by Stephen Lett

Circulation planning is about more than selecting which prospect names or house file segments to mail. The merge/purge is critical to the success of your mailing too. That’s why we want to focus on the “merge/purge” this month. How you instruct your service bureau to run the merge can affect your mailing results. How to assign list priorities, treat multi buyers, deal with family groups and more are all topics of this article. Obviously, the main purpose for running a merge is to identify and to eliminate duplicates from your mail file. There are two types of duplicates a merge identifies which are as follows:

  1. Duplicates between files, which are known as Inter File Duplicates.
  2. Duplicates within a file are known as Intra File Duplicates.

When there are duplicates on the file, the merge can assign the surviving record randomly across all lists or based on a defined priority by list. In other words, the merge assigns which list will retain the record that appears on more than one list.

MULTI BUYERS
While the merge assigns the surviving record, it also creates a file of the duplicated records for future mailings. These are called multi buyers. They are names that have “hit” on one or more rented lists. Normally, they are categorized by how many times the record appears in the merge, i.e., 2x, 3x and more. A two-time multi, for example, is a record that appeared in the merge twice. It was mailed for the first time under the list where it was assigned and it can be mailed a second time in a future mailing for no additional list rental expense (you have already paid 2 different list owners for the same name). Multis are only captured for outside lists since there is NO benefit to pulling house file names out of their R-F-M (recency, frequency and monetary value) cells.

The surviving multi buyer information is also retained in the merge. When the merge assigns duplicates based on random allocation or on a prioritized allocation, the duplicate name that is retained is tagged as a multi buyer. Typically, the merge report identifies; “singles” that appear in the merge only once, multis that appear in the merge more than once (and were retained on that list) and “output,” which is the combination of the two.

FAMILY GROUPS
Family groups are identified so that “same” lists do not falsely create a multi buyer. For example, if you take two different selects from the same list owner, they should be unduplicated before they are sent to your service bureau. If they are not, the duplicates between the files could be considered a multi buyer in the merge. In this example, they are not multis but the same record being pulled twice. By identifying these in the same family group, the merge would consider these intra file duplicates, which can be deducted from your list rental invoice.

HOUSE FILE PRIORITY & FAMILY GROUPS
So, how do we use this information? How do we establish priorities and family groups? Here are a few rules to consider:

  1. Always put your house file (your customers) in the top priority with the best performing R-F-M groups at the top of the priority and the lower performing R-F-M cells at the bottom of the priority. If your file has gone through an update, there will be very few duplicates. However, it is still important that any duplicates found are associated with the “best” possible R-F-M cells.
  2. There are times when you will only mail or re-mail a portion of your house file. If the duplicates within the house file were random, you might drop a record that actually is from the higher R-F-M priority. By prioritizing your house file, you will be sure to mail the best performers.
  3. Assign your house file buyers to the same family groups. Therefore, duplicates within the house file will be considered intra file duplicates. By doing so, you will know what multis credited to the house file will have also appeared on another list (other than the house file).
  4. If you are not mailing all of the house file records you put in the merge, make sure you do not drop what has been identified as multis. These are primarily records that came from an outside list that hit to your house file and they will perform well.

PRIORITIZING SPECIFIC PROSPECT LISTS OVER OTHERS
There are many theories to setting outside list priorities. Whether it’s your cooperative database names or your best performing outside prospect lists, by setting one group of prospects over another they will have the most multis assigned to them and therefore, a performance advantage. Here are a few points to consider:

  1. Is there a true reading of their performance? Should you measure all outside lists on a level playing field?
  2. If you are renting a lot of names and can work out net name arrangements, there is an advantage to showing a lower net on certain rental lists. By putting exchanged names or coop databases in a higher priority, you will net lower on list that you pay for and be able to use this to negotiate a better arrangement. This can be hard to keep track of when measuring performance over time.
  3. It’s harder to find outside lists that perform well, if they don’t have multis allocated. If you are looking to grow your business, this approach may not work.
  4. If you net low out of the merge, check to see if the lists are duping against each other or against the house file. If they dup to each other, there is no reason to bring all of the names into the merge. If they dup to the house file, it is best to mail net reuses or to negotiate a better net arrangement with the list owner.

Whether you decide to prioritize certain outside lists, or keep them random, it’s best to stick to the same routine for understanding a lists performance over time. In other words, be consistent in your approach!

FAMILY GROUPING PROSPECT
Here are a few rules for dealing with family groups:

  1. Only family group lists from the same mailer are included here. 
  2. Look at high intra file duplicates as an indication of how well (or not well) the mailer maintains their file and how accurately they process list orders.  If there is a consistent problem, proceed with caution.   
  3. Remember to deduct any intra file duplicates from your list rental invoice.

OUTSIDE LIST RENTAL RESTRICTIONS
What do you do if a list owner says they will not allow you to make a promotional offer to their customers? How do you keep these people from being mailed? What happens if they show up on the multi-buyer file?
In the merge/purge, we put all rented lists in on what is called random allocation. This means that if a name hits two different lists, the name resides on list A and is dropped from list B. Next time a dup is found; it resides on list B and is dropped from list A, i.e., "random allocation". It IS possible that a name on any given list could be knocked out of these lists while the name survives on another rented list. This can, and will, most likely occur. BOTTOM LINE: As long as we do not mail the offer to the rented lists that declined our offer, we are fine.
To be safe, the service bureau should be instructed to put the lists that won’t allow promotions in the merge with the LOWEST priority. (This will yield the maximize number of catalogs that can get the offer) We should also have the service bureau de-dup these lists against each other to knockout any multis on these lists. Then, we should also instruct them to retain the original keys with the multi-buyers and "pull" these keys for the lists so that we do NOT mail these names a 2nd or 3rd time when we mail the multis.

A word of caution: Putting the list that disallows promotion in the lowest priority will perform at a lower rate if no multis are attributed. Eventually, the list may be dropped out of the list pool that is mailed due to a lack of performance. Unless you are taking this into consideration and factoring this list’s performance back up for what it “would have done”, it’s a sure way of eliminating a list that works from future mailings.

Your merge should be used to maximize your mailing, not just to remove duplicate records. By considering how you would like duplicates and priorities assigned prior to the merge, you will get the most out of your merge.