UPDATED 17:59 EDT / NOVEMBER 06 2020

BIG DATA

Lob adds cloud big-data magic to plain old snail mail

Some 306 billion email messages traverse the internet each day, but the need for physical mailboxes hasn’t gone away, a fact that was underscored by the U.S. election. The U.S. Postal Service still processes nearly 182 million first-class letters on a typical day.

Thanks to technology germinated in the cloud, those printed pieces are getting some of the same personalization and tracking features that have long been the exclusive domain of electronic communications. That’s where Lob.com Inc. comes in. The seven-year-old Bay Area company is a direct-mail house with a big-data twist.

Lob provides application programming interfaces for direct mail and address verification that businesses can use to send personalized mails programmatically, track their status, identify returns, pinpoint bad addresses and even estimate open rates. The startup, which has raised nearly $30 million, has amassed a base of more than 7,000 customers, including giant corporations such as Capital One Financial Corp. and Verizon Communications Inc.

“Companies continue to send mail but have lacked good software tooling to do it,” said Harry Zhang, co-founder of Lob. “There hasn’t been an API for sending letters and postcards.”

APIs for postcards

Zhang got the idea for Lob when he worked on direct-mail campaigns while at Microsoft Corp. “We had an army of people dropping files into an FTP folder to pass them back and forth,” he said. “It wasn’t very elegant or automated.”

Lob is based on the notion that direct mail should be tightly integrated with a company’s applications rather than treated as an afterthought. Cloud APIs now make that possible.

Through a partnership with the postal service, Lob gets to peek inside the mail delivery network to track the progress of its printed creations through sorting machines and onto mail trucks for delivery. In exchange, it provides the postal service with address verification data, a Lob specialty area that Zhang described as “super messy.”

The company’s APIs allow customers to specify delivery radii from entire regions down to individual households with messages, toll-free numbers and URLs customized for individual recipients. When an API request comes in,  “we run through a series of checks to prepare a PDF and pass it through to the print delivery network,” Zhang said. “We then return programmatic information about where the mail is in the mail stream. We can tell you exactly what PDF was produced and whether it was delivered.”

Automating a messy task

Unlike many direct-mail companies, Lob doesn’t focus solely on marketing applications. It also works with operational teams on projects like a Booking.com BV campaign to verify 1.3 million mailing addresses physically across 280 countries and one at CouchSurfing International Inc. that shifted from a mass-mail verification to a fully automated on-demand model.

Retirement plan administrator Betterment for Business LLC used to have a “printing and pizza party” every quarter when staffers would get together to print nearly 40,000 customer statements manually and stuff them into envelopes. “A conservative estimate for the effort across teams was 80 hours per quarter and rising as we brought more and more plans onto the platform,” said Kristen Carlisle, Betterment’s director of B2B operations.

The company used Lob APIs to full automate the delivery of statements and checks, even automatically re-issuing checks that aren’t delivered or cashed. “Building new features with Lob is very simple for our engineering team and they end up saving hundreds of hours of manual work,” Carlisle said.

Betterment uses Lob’s “Webhooks” to get notifications that can be incorporated into workflows. They can be used for such purposes as sending customers notifications when their mail is processed for delivery, alerting them to rerouted or returned mail and previewing customized PDFs before they’re rendered.

There’s one limitation of printed mail that the company hasn’t yet figured out, however. “It’s impossible to track true open rates for physical mail as you would for email,” Zhang said. Although customers have come up with creative tactics such as unique coupon codes, URLs and QR codes to measure mail response, there is still no “opened” API for snail mail.

Photo: Mikaela Wiedenhoff/Unsplash

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