SmartyStreets

What Are Geocodes and What Is Geocoding?

Map with Latitude Longitude Geocode Displayed - Geocoding Example

A geocode is the set of latitude and longitude coordinates of a physical address.

Geocoding is the process of turning a physical address into a set of latitude and longitude coordinates which can then be plotted or displayed on a map.

(Want start your very own collection of geocodes? Try our hyper-accurate US Rooftop Geocoding Demo now.)

We will cover:

Geocode Basics

A ‘geocode’ is just a fancy, shorter way of saying ‘a latitude / longitude coordinate’—much in the same way that ‘geocaching’ is just a fancy way of saying ‘scavenger hunt.’ In other words, a geocode is the latitude and longitude coordinates for a specific location.

So, if geocodes are the lat long coordinates, then geocoding is converting a location's description from one format (like a street address) into that location's specific lat long coordinates. Geocoding can be done in a number of different ways that differ in methods, costs, and results.

How accurate is geocoding?

Asking “How accurate is geocoding?” is like asking “How fast is a car?”. Neither question can be answered until we ask a more precise question. For example, if you asked a more precise question like, “How fast is a Ferrari F40’s 0–100 km/h?”. We can easily answer “4.1 Seconds”.

Perhaps a more precise question to ask about geocoding would be, “How accurate can geocoding be?”. That is a question worth answering. To give you the answer you need, we need to discuss the four main types of geocode accuracy. They are, ZIP+4, interpolated, parcel centroid, & rooftop.

ZIP+4 Level Geocodes

ZIP+4 Centroid Geocoding Example

A ZIP+4 Code represents a postal delivery route that generally contains 10-20 addresses. A ZIP+4 level geocode is simply the approximate center of that route. This makes these geocodes accurate to about the block level of the desired address. This is great if you only need the approximate location of an address without needing to know the exact rooftop or parcel.

Interpolated Geocodes

You may have heard of interpolation before, likely used by a math teacher. Interpolation isn't just useful in high school math classes, though. It's also used in other practices—like geocoding.

Interpolation adds speed to the geocoding process even though it is not the most accurate approach. Despite the complexity of the math involved, the concept itself is surprisingly simple, and it works like this:

Take a random street. For simplicity's sake, we'll say a residential street that terminates in intersections at both ends. Now let's suppose we have two geocodes that are in close-proximity to the addresses on the street we want to know about.

Let's assume those two geocodes are at either end of the street, that is, at either intersection. Once we have this information, we can use math to determine what's in the middle. When we use interpolation, we say, "Well, we start with point A, and we end with point D, so in between must be point B and point C."

Interpolated Geocoding Example

Fortunately, this method of determining geocodes is a process that can be automated by way of computer programs.

When we use math to determine where point B and point C are between point A and point D, the math puts the geocodes at regular intervals and set patterns, which is not necessarily the way that homes and businesses are built. The fact is, people put buildings wherever they feel like. So the precise physical geocode of a home may be different from the interpolated geocode for that same home. When we use interpolation to create geocodes, we're creating geocodes that are "street-segment" accurate, but not "rooftop accurate."

That data is built from the combination of the US Census Bureau's TIGER data and supplemental data we assimilated from additional organizations to improve the accuracy of our coordinates. And, because of our lightning-fast computer systems developed and maintained by our world-class tech gurus, when you give us the address we can immediately give you the geocode that matches that address. So we save you time and money, and we give you the most accurate block-level data.

Parcel Centroid Geocodes

Parcel centroid geocodes are calculated by taking the known boundaries of a property. Then, you approximate the geocode in the center of the parcel. Hence, the name “parcel centroid”.

Parcel centroid geocoding tends to be more expensive than ZIP+4 or interpolated due to the additional data needed to calculate the geocodes. Unfortunately, it still lacks considerable precision.

An important consideration with parcel centroid geocodes is that homes are often not built in the geographic center of the property. This is especially true in the cases of large or irregular parcels.

The purple markers on the image below are parcel centroid geocodes provided by the Google Places Geocoding API. Notice how Google places the geocode in the pond?

Parcel Centroid Geocoding Example

A rule of thumb in geocoding is, the bigger a parcel, the less useful the parcel centroid geocode. Often, you need to pinpoint the roof of the home, and knowing the center of the parcel is not precise enough. Parcel centroid geocodes may fall hundreds of feet from the home or structure.

Rooftop Geocodes

Knowing exactly where the primary structure is on a parcel holds high value. In the case of insurance quotes, city planning, telecommunications and hundreds of other use cases, those dozens or hundreds of feet can be the difference between success and failure. That is why rooftop geocoding exists.

True Rooftop Geocoding Example

Rooftop geocodes start with the parcel centroid geocode, which is then refined using additional data-points and calculations in order to match the geocode with the actual rooftop of the primary structure on the parcel. The more precise the geocode, the more expensive and difficult it is to obtain.

When looking for geocoder service providers, never trust that geocodes are truly “rooftop accurate” just because the provider says they are. Unscrupulous providers will often slap the “rooftop accurate geocodes” sticker on geocodes that are really only parcel centroid.

These providers count on you not checking the accuracy of their geocoder thoroughly before committing.

To ensure you are really getting the accuracy you need, test any geocoder you are considering with many parcels. Be sure to include large and irregular properties as well as suburban and rural plots in your testing.

SmartyStreets provides true rooftop geocodes.

What Level of Geocoding Accuracy do you need?

ZIP+4 and interpolated geocodes are a lower price and lower precision. This makes them cost effective for some applications.

Rooftop-level geocodes are a higher price and far higher precision. This makes the cost effective for applications where hyper accuracy matters.

Parcel centroid geocodes are a higher price and lower precision. This makes the cost effective for few use cases.

In other words, parcel centroid geocodes are like a car that is also a boat. While it is a neat concept, an amphibious car is expensive and ends up being a poor quality car and a poor quality boat.

Who wants the worst of both worlds? For that reason, SmartyStreets does not offer parcel centroid geocoding. We offer hyper-accurate US Rooftop Geocoding. Where rooftop geocodes are not possible, we provide ZIP+4 geocodes.

What is geocoding used for?

Geocoding is used whenever someone needs to know the precise position of something on earth. We could write a book about what geocoding is used for but here are three examples to get you thinking.

  1. A restaurant franchise wants to send a coupon by mail to 300,000 addresses in a metropolitan area. The restaurant has ten nearby franchise locations and the company wants to print the address of the nearest location to each household.

    By geocoding all the addresses in the area, they can easily determine which restaurant address should be printed on each coupon. Less precise ZIP+4 geocodes would work here.
  2. An insurance underwriter needs to know exactly how far a home is from a nearby river. In this case, the home is on a 100 acre (40.469 ha) farm. A parcel centroid geocode indicates the home is 750 feet (0.23 km) from the river and would result in a low risk assessment and quote.

    A true rooftop geocode would reveal that this home is built 20 feet (6.1 m) from the river. Knowing the home’s actual distance from the river leads the insurance company to an accurate risk assessment and a correct quote. A rooftop geocoder would give the competitive edge in this case.
  3. A telecommunications company wants to understand if their customers are well covered with their new network upgrade. The company wants to ensure customers will have adequate signal strength.

    By directing their signal to structures rather than empty land or parking lots they create happier users who don’t have to wander into their backyard or parking lot to watch YouTube videos. Rooftop geocodes would be needed in this application.

How do I find Geocodes?

This is an easy question to answer. To perform a geocode lookup, you simply need to enter an address into a geocoding service. You can use the hyper accurate SmartyStreets US Rooftop Geocoding service. You can also use our less precise ZIP+4 accurate geocode service. Either geocoder can provide you with geocodes blazing fast.

Reverse Geocoding

While geocoding helps you find latitude and longitude coordinates for an address, if you already have a log of geocodes, you may need to transform those geocodes back into physical addresses. After all, geocoding shouldn’t be a one way street.

This is a process called reverse geocoding and is worth learning more about. This is useful in cases where you need to identify the address of the point on a map. Such as the address of a home, business or landmark.

Geocoding with Google

Sometimes services like Google will geocode locations that don't exist.

Places like Google and Bing usually do parcel or rooftop-level accuracy on their geocodes. Map services do this, so they can give you GPS directions to a location. It's helpful when you want to know how to drive to where you're going.

What they don't do is check for the validity of an address, like we do. That means if conditions aren't perfect (you entered the address incorrectly, the area isn't well mapped, etc.), Google may actually be dropping the pin on the map when it should be telling you it couldn't find what you were looking for. In short, Google doesn’t validate addresses.

So if you're counting on a mapping service to provide you with geocodes, you may find yourself requesting geocodes to a place that's no longer an active mailing address, isn't one yet, or isn't a real address at all. As many have already experienced, this is a problem even if you're looking for physical addresses rather than geocodes.

Since SmartyStreets' first love is address standardization and address verification, it's the first thing we check. And if the place doesn't exist, we won't give you the geocodes for it.

Why Did I Care about All of This Long Enough to Read to the End?

So at the end of the day, SmartyStreets' geocodes are hyper accurate, and they're a bunch quicker than the competition. And best of all, by combining geocoding with address validation, you can be sure the data we give you is reliable.

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