April 4, 2010

Pre-Census Letter : Waste or Good Sense?

My wife and I filled out our Census survey not long ago.   It took a few minutes and was no big deal.  Sometime before we got the actual survey we got a letter from the Census notifying us that we'd be getting a letter from the Census.      The letter didn't tell me anything more than that I should expect to get a letter with Census forms from the Census in about a week.  I read the letter and thought to myself "what a waste of money and paper" and set the letter aside.   Then we got the Census survey.   Then a bit after that we got a post card reminding us that we should fill out our Census survey.

This article on The Good Human blog had similar thoughts on the pre-notice being a waste.  And I'm sure many other people had the same reaction.  It seems like a total waste of money to send letters to tell you that you'll be getting something in the mail.   But is it really a waste? 

I found an article on the Minnesota Public Radio site with response from the Census Bureau on the topic.   You can read the full response on the MRP site.  But I'll summarize it as :  The Census bureau says that it costs them $85M to send out that pre notice letter.  But they figure that it will prompt 6-12% of households to return their Census letter who probably wouldn't have otherwise.  If people send in their Census form then the Census bureau doesn't have to send a Census employee to their home to ask them for the the information.   That saves them about $57 per household in costs by avoiding the in person visit.   The Census bureau predicts they will save over $500M by sending out that pre notice.

Now if that $57 figure sounds high to you then I'd agree.   The Census pays people something like $10-$20 to work as Census takers.  So how could it cost $57 to get Census data from one household?  I'm sure there is a lot of overhead involved in training a Census worker, paying them benefits, hiring supervisors, etc.  So you're not just looking at the hourly pay rate.   Also theres a lot of wasted time when doing the census including travel and repeated trips to homes after finding the residents aren't at home.  

I went to the Census site to see if they had any links, news items or anything else addressing the apparent waste of sending a pre-notice like they did.   The closest I found was an FAQ entry on the topic: 2010 Census : Too Many Mailings.

The answer they have there is : "We find that it is cost effective overall. Getting households to return their questionnaire on time is the key factor for conducting a successful census. When people don't return their questionnaires by mail, we must send a census worker to their household to obtain their answers. Many times, that requires multiple visits, which can be very expensive.
The Census Bureau estimates for each percentage point of the population that does not return a questionnaire during the 2010 Census, it costs approximately $75 million dollars to have field representatives make these personal visits to get their information. If the mail return rate increases, then the nonresponse followup workload will decrease reducing the cost of the census.
Our "multiple contact" mailing strategy was developed to get the highest mail return rate possible. Our studies have shown that mailing a letter telling you that a questionnaire is on the way and a postcard reminding you to send it in, increases the mail return rate. We have found that the second mailing, or replacement mailing, increases the rate of mail return by some 7-10% and eliminates the need to send census workers to many homes, thereby saving millions of taxpayer dollars."

Thats about the same logic in the MPR article.   

Look at all the junk mail that you get sent to your home.   All of those letters and circulars cost money for the companies to send them.   They aren't doing that to be wasteful.   Undoubtedly businesses get enough responses from those letters to justify the cost of sending them out.   I think that this is pretty decent evidence that marketing via mass mailings can be successful.

Reminders are helpful to prompt people to action.  I've got a lot of items in my calendar here at work and each one has a little reminder setup so it will pop up and tell me when I should do something.   If I send an email to a coworker and really want to make sure they respond to me by a certain day and time then I can set the 'follow up' option flag so that Outlook will prompt them with a reminder.

Sometimes spending a little up front money can save you a lot more money in the long rung.   I think that is likely the case here with the Census pre-notice letters.   How much they save exactly is debatable but there are undeniable cost benefits to getting higher response rate on survey forms.

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