Address Verification

What Are Geocodes and What Is Geocoding?

By 15 July 2021July 20th, 2021No Comments
geocoding and geocodes

Understanding Geocodes and Geocoding

There are millions and billions of addresses around the world. It can be really difficult to map physical locations so that companies and marketers can get a view of all the addresses altogether. With the help of mapping, businesses can form marketing plans and reach out to their customers smartly and accurately. Hence, there ought to be a way to do so. Apparently, geocoding was introduced, and the answer came clear as a bell.

geocoding and geocodes

Geocoding is a process that takes text-based descriptions of places as inputs and returns their geographic coordinates as outputs. It converts an address or a place name into latitudinal and longitudinal coordinates. Geocoding is primarily used for identifying different locations on the face of Earth that can be presented on a map.

Geocodes are the set of coordinates returned through geocoding. They can help businesses track addresses, streamline their operations, and widen their reach.

Geocoding Accuracy

How accurate is geocoding? Perhaps, the better question to ask is how accurate it can be. There is no one answer for both these questions as there are different types of geocoding that are accurate at different levels. As a matter of fact, the more accurate the geocodes, the more is the cost.

Postcode Level Geocoding

There are usually 15 addresses under every postcode—representing the postal delivery route that covers those addresses. Postcode level geocoding helps you locate the approximate centre of these routes so that you can get a rough idea of where the concerned addresses are located. Hence, these geocode are accurate only at the block level.

Though not completely precise, geocodes returned by postcode level geocoding can enable businesses to conduct door-to-door marketing and also identify relevant postcodes using demographics and geographics that define their customer profile.

If you only need to know the approximate pinpointed location of addresses and not the exact rooftops, this type of geocoding can work well for you. Moreover, it is far less costly than rooftop geocoding.

Interpolation Geocoding

In simple words, interpolation is a method through which known or established values are used to find out other unknown values that are in sequence with them. We all must have heard about it at school, but now is the time to put it to use. This is used to find out address geocodes by using known data points that happen to be on the same street or even block.

For example, there is a street named Shaftesbury Avenue. Now imagine that the street ends with an intersection at the starting and ending points both. Suppose you already have two geocodes at either point that is nearby to the addresses you want to know about. A and D are the starting and ending points, respectively. Interlocation geocoding uses these already known points to determine points B and C that exist in the middle.

This geocoding type assumes that all addresses are located at regular intervals from each other and, in common, repetitive patterns, which is seldom the case. Therefore, such geocodes are only street-level accurate.

Parcel Centroid Geocoding

Parcel centroid geocoding is the process of finding geocodes of the centre of a property or parcel. Basically, it uses the parcel’s known boundaries, finds its centre, and returns geocodes for that centre. Hence, they are known as “parcel centroid” geocodes.

It is much more expensive than interpolation and postcode geocoding because the method requires additional data to make the necessary calculations. Unfortunately, it is still not precise.

The reason for its inaccuracy is that houses are not always built in the centre of parcels, especially in the case of irregular and large properties. For large properties, it is better to use other types of geocoding.

Rooftop Geocoding

Undoubtedly, rooftop geocoding is the most precise type. It is therefore also expensive. Knowing the exact location of an address at the rooftop level is of great importance to many industries, from healthcare to real estate. All the other types of geocoding can only give you estimates, which could vary widely.

Rooftop geocoding starts off as parcel centroid geocoding and then uses additional data points to calculate and refine geocodes at the rooftop level. Rooftop geocoding works best when used with address verification solutions like PostGrid.

Determining the Accuracy pf Geocodes That You Require

As we have already established, postcode and interpolation geocoding are relatively less priced. But, they also provide less precision. Businesses working on a tight budget can consider using them if their operations do not demand cent per cent accuracy.

On the other hand, parcel centroid and rooftop geocoding can cost you a lot, although only one of them offers precision. It is safe to say that parcel centroid geocodes are not exactly worth the price. Hence, if you intend on investing in precision, you can pay a little more and go for rooftop geocoding.

Geocoding Applications

Geocodes are used for far more things than we can even mention. Whenever someone wants to know the location of an address, geocodes come into the picture, making it widely used.

  • Supposedly, you are the marketing manager of a bank and there are altogether 15 branches all over the city. You need to get 400,000 personalised letters printed and mailed as part of a campaign. In each of the letters, you need to mention the address of the nearest branch. How will you do that? In this case, you can just make use of postcode geocoding to identify the branch closest to each of the addresses in your mailing list. Restaurants, boutiques, hospitals, and other businesses with various branches or franchises can benefit from postcode geocoding significantly.
  • Let us take another example of yet another application. Insurance underwriters need to conduct risk assessment examinations before quoting. If a particular underwriter needs to determine the distance of an apartment from a nearby firework factory, geocoding can come into use. In such cases, it is advisable to only use rooftop geocoding. Other types can make you believe that there is no risk at all and the factory is located at a safe distance when the reality could be far from it.
  • Geocoding is perhaps the most used by telecommunication companies. From checking their network coverage to building signal towers, geocoded can help them immensely. Using rooftop geocoding, they can determine residential and business areas where the signal should be strong, along with empty grounds and parking lots where poor networks can work just fine.

Reverse Geocoding

Reverse geocoding is the exact opposite of geocoding. Geocoding converts text-based addresses into geographic coordinates, whereas reverse geocoding converts geocodes into text-based addresses. It is helpful when you have the coordinates of a particular location and need its physical address in words.

Reverse geocoding is not as popular as geocoding because the returned results are not always perfect. These addresses might not even be parsed and standardised enough for you to understand. However, you can use PostGrid’s address validation API to complete, parse, standardise, validate, and verify addresses.

Google’s Geocoding Services

When we talk about Google, we think of it as a “know-it-all.” However, if there is one segment where Google is lagging behind, it is their location services. Be it address verification or geocoding. Their services are not quite helpful.

Google can help you locate addresses as pinpoints on a large map, but the geocodes returned by them are never precise. Their mapping services work just fine and can help you get to a particular address by providing you with the right route. The biggest catch is that Google can return geocodes even for addresses that do not even exist. Hence, their results are far from reliable.


Most companies that use geocoding aim to optimise their mailing activities. PostGrid can help you with the same through their automated direct mail and address verification solutions. We use rooftop geocoding to verify your addresses and assist you with all your print and mail activities.

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