Data Quality Initiative Delivers 17:1 ROI

Challenge:

A Pharmacy Benefit Manager (PBM) client had a very successful direct mail program that was delivering active relationships from 10% of the prospects contacted. These prospects were members of a health plan, and the objective was to get them to fill prescriptions via mail order with the PBM rather than at their local pharmacy. The problem that the PBM faced was bad data. Too many of the members were not being reached because of data quality issues. At 10% activation, it was obvious that reaching more members would result in many more highly profitable relationships.

Solution:

KBM Group used its data hygiene processing methodology to find people who had moved to a new address, and corrected other bad addressing in the source file that had resulted in non-delivery.

Results:

Out of ten million pieces mailed (at approximately $1.00 per package), KBM Group was able to correct the address on 49,307 consumers. Those consumers were then re-mailed.

• The 10% activation rate held up in the remailing, which delivered, 4,930 new relationships
• Each new relationship delivered $28.60 profit per customer per month.
• That delivered $1.7 million in profit per year to the PBM – a 17:1 return on the investment in data quality.