Fifty years ago (1963), Postmaster General Day proposed the idea of zip codes to assist in sorting the mail.  It wasn’t an original idea; he adapted the notion from a similar plan that had just been introduced in West Germany.  He outlined no greater use for the adaptation other than to make sorting quicker in an effort to handle the increased volume.

Today, zip codes are utilized as much by businesses outside of the Post Office as the agency itself.  Zip codes are a convenient way to categorize census data, demographics, mortgage risk zones and socioeconomic analysis.  I know from firsthand experience that colleges use them to purchase the names of ACT/SAT test takers and to track all kinds of enrollment data.  We often refer to target areas by zip code rather than city/state.  IBM estimates that the annual value of Zip codes is $9.5 billion.  

ZIP is actually an acronym for Zone Improvement Plan.  With its introduction, the two-letter state abbreviations were introduced to accommodate space limitations on magazines and address labels when the ZIP numbers were added.  The Post Office originally introduced Mr. Zip to promote the use of the codes when use was optional.  

Now zip codes are mandatory for most classes of mail and are used by GPS systems, credit card authorizations and countless other forms of technology.  Ironically, the use of codes has grown exponentially while the physical mail that needs to be sorted with them is dwindling.

How can you apply lessons from zip code adaptation to your organization?  Can you overlay your zip code analysis with other demographic or psychographic data to gain a more robust understanding of your clients or potential customers?  Do you have data that can be used in multiple ways — either inside your organization or beyond it — as happened with the zip codes?  Those five little numbers at the end of an address are the key to a wealth of corresponding information.  Take the time to unlock that knowledge for your organization.

— beth triplett

Source:  50 years in, ZIP codes still beneficial by Adam Belz, Minneapolis Star Tribune, in the TH  6-7-13 and
Wikipedia ZIP code

Leave a Reply

%d bloggers like this: