What is a Postal Code?

If asked, most people can supply a reasonably correct answer about what a postal code is. But postal codes are more complex than they seem. In the first place, mail delivery services across the world use postal codes. Each country has a different way of using codes on mailpieces to deliver mail to the proper destinations. Postal codes in some countries consist of numbers only, but other varieties feature combinations of letters, numbers, spaces, or punctuation marks.

In the United States and the Philippines, the postal code is the ZIP code familiar to most Americans. You might think that the “zip” part of the ZIP code name is a reference to the speed at which mail moves through the system, and it is. But it’s also an acronym for the Zone Improvement Program the US Post Office rolled out way back in 1963.

Some ZIP Code History

The original ZIP code contained five digits. The first three digits designated a regional USPS sorting facility, and the last two digits identified the USPS Post Office or delivery unit. Each five-digit ZIP code corresponds to a USPS delivery location. You may have noticed that a five-digit ZIP code is usually displayed on the physical buildings of your local postal facilities.

In the continental US, the lower ZIP codes are in the east, with larger numbers designating western states.

Implementation of the original ZIP code improved the USPS’ ability to sort and deliver the mail on time. Before 1963, employees sorted the mail based on their knowledge of addresses that appeared on the mail. As mail volumes grew, it became increasingly difficult to continue handling the mail without adding some automation, and that’s what the ZIP code provided.

The original ZIP code served its purpose until 1983, when the USPS added four more digits. The ZIP+4 codes identify city blocks, an office building, or the side of a street. Individual residents were never required to memorize or use the new four digits for their consumer mail. The USPS was more concerned with finer sortation on the large volumes generated by commercial mailers.


By the time the Postal Service introduced ZIP+4, businesses had moved much of their customer information to computers. Veteran computer professionals may recall the new added digits forced some companies to change their mainframe computer programs to make room for the extra four bytes of information. They had designed their fixed-length data records to accommodate only the five-digit code, with no room for expansion!

After the USPS introduced ZIP+4, they began offering postage discounts to mailers who encoded the nine-digit code into the Postnet barcode they printed on the mailpieces. The Postnet barcode allowed the USPS to sort mail by machine. This innovation replaced large rooms of USPS employees who read the ZIP codes printed on mail and entered them into workstations that then controlled mail routing.

Today, we use an eleven-digit ZIP code. The Postnet barcode has been replaced with the Intelligent Mail barcode (IMb). The IMb now includes all the ZIP code data plus other information used to recognize and track individual mailpieces as they progress through the postal delivery network. The last two digits of our current ZIP code single out individual delivery locations. For residential houses, for instance, the ZIP+4+2 code includes the last two digits of the house number. Machines can now sort mail into delivery sequence, relieving postal carriers from much of the manual work of putting the mail in the right order before beginning their daily routes.

11-Digit ZIP Codes

Most of us never see the last two digits of an eleven-digit ZIP code. This information is included in the barcode but not printed as part of the visible address block. The data is meant for machine processing and has little value for humans.

The Importance of Postal Codes

It’s easy to take postal codes like ZIP codes for granted. Today we’re used to seeing them on every piece of mail we produce. Most people have a general idea about what ZIP codes do, even if they are unaware of what goes on behind the scenes at the US Postal Service. Unlike the population in 1964, we’re accustomed to embracing technology that makes life easier or improves efficiency. The USPS no longer needs to mount public relations campaigns like they did decades ago. They used “Mr. ZIP” and many other methods to ease fears that our lives were being taken over by numbers and machines.

Postal codes were the item that allowed the US Postal Service to modernize their operation and led to the development of the postal barcodes. The IMb now powers all the Postal Service’s most advanced features, including sortation, delivery, ancillary services, Informed Delivery, Informed Visibility, Address Correction Service, postal promotions, and more. Without the original ZIP code and all the enhancements that followed, commercial mailers and the Postal Service could not offer the level of service and the data today’s mailers demand.

What began as purely a method to expedite mail sortation and delivery has now become a de facto geographic location method, though not a very accurate one. Governments and businesses use ZIP codes in all kinds of applications to approximate the physical locations of people or buildings. Identifying the nearest bank branch or government office serving a general geographical area, for example.

Obviously, an accurate postal code is important for mailers and non-mailers. Software and official data sources can apply ZIP codes to addresses or verify the codes on file are correct. This requires the other elements of a postal address to be correct and complete. That is where software like Firstlogic’s Address IQ comes into play. Address IQ and the rest of the software that comprise the Firstlogic Data Quality IQ Suite allow companies to standardize and correct postal addresses and to assign accurate ZIP codes and postal barcodes.

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