Geocoding

What is geocoding? Definition and explanation

With geocoding, software converts address data into geodata. This is done by assigning the appropriate X/Y coordinate to an address. Geocoding enables you to convert addresses into coordinates.

The coordinates are required to visualize locations on a digital map (e.g. Bing Maps, Google Maps) or in geographic information systems (GIS software). Only with the geocoding process are you able to display your addresses on a map as points (pins) or as geometric shapes for an entire area.

The addresses to be geocoded do not have to be complete. It is ok if parts of the address are missing (e.g. house number, postcode, etc.). Because with geocoding, you can also assign geographical information in the form of map coordinates to locations, states, postcodes, etc.

Of course, the following applies: The more complete the address, the more precise its location on the map.

1. Address Geocoding: From Address to Coordinate

Basically, every geocoding is an address geocoding, and for certain locations (for example, a lake or a mountain), the address is not quite as precise as for a customer address or a branch location. For companies and organizations, the most common application of geocoding is the geocoding of addresses. Because this allows addresses to be converted into coordinates.

Companies then use the generated coordinates for geomarketing, market, potential and location analyses, as well as for the visualization of customers, locations and supply chains and similar applications. The addresses to be geocoded are often addresses of customers, suppliers, branch locations, competitor locations, points of interest etc. By the way, you can find more on how companies use coordinates further down in the text.

2. Reverse Geocoding: From the Coordinate to the Address

Geocoding has two directions. Some geocoders not only convert addresses into coordinates, but also the other way around. The software then converts the appropriate address with street name, house number, ZIP Code, place and country name. The direction from the coordinate to the address is called reverse geocoding. 

Reverse geocoding is thus geocoding in reverse. You convert geo-coordinates into textual location information, i.e. into an entire address or city or country name etc. To do this, you need geocoding software that is explicitly suitable for reverse geocoding. 

3. Batch Geocoding: Geocode Multiple Addresses at Once

Batch geocoding describes the geocoding of a large number addresses and is used very frequently by companies. Because most companies have very large amounts of addresses that need to be geocoded. Typing every address individually just does not make sense. Batch geocoding enables you to start the process once and the software then automatically geocodes many addresses at once. This saves a lot of time and nerves.

Geocoding Software

For any type of geocoding, whether address, reverse or batch, you need suitable geocoding software, such as Geocoder JoinAddress from WIGeoGIS. JoinAddress can be tested free of charge!

Assigning a coordinate to an address and vice versa may sound simple, but it is far from it, because different components have to work together in geocoding. A geocoder works as follows:

Components of a Geocoder

A geocoding tool for professional use basically consists of the following components:

• A reference database in which addresses and geographic coordinates are saved.
• A server software that uses and searches the reference databases as sources to find, construct and output the appropriate coordinate.
• A batch function for geocoding mass data.
• Typeahead address search for the flexible entry of and search for addresses.
• A client software with which the geocoder is queried. This can be a locally installed client or a web client (for online geocoding).

The building blocks alone make it clear that a geocoder can only be as good as the reference databases it accesses. On the other hand, the geocoding software must be potent, meaning it works quickly and has an intelligent search algorithm. A batch function is essential for professional use. In addition, geocoders differ in terms of the flexibility with which clients can query the geocoding server.

This is how the geocoding process works

The different building blocks work together in the geocoding process. The following happens:

1. You enter an address into the geocoder, for example Hansalgasse 3 in Vienna. The more completely you enter the address, the more precisely the software can locate it on the map.
2. The intelligent geocoder software searches a gigantic reference database for your address and delivers the correct and most precise coordinates.
3. This allows addresses to then be located and displayed on a map.

What types of geocoders are there? Which is the right one?

In the past, Geocoders were exclusively installed locally in the company, but today web services are also available that allow you to geocode directly in a browser. This corresponds to the current IT usage trends in companies. Modern geocoders therefore offer local and online geocoding. Both variants have their justification and advantages depending on the respective usage scenario and the needs of the company. That is why many companies do not choose one variant, but use both. Many companies geocode large amounts of data and sensitive data locally in-house, while for other addresses they use an external online geocoder. If you want to find the right geocoder for your specific needs, you have to take a close look.

Tip: How to recognize a good geocoder

What makes a good geocoder? Which one is right for me? It depends on your needs. Basically, geocoding software should have the following features:

• Completeness and accuracy of the reference data
• High quality of geocoding
• Transparency when displaying the geocoding result
• Speed and performance
• Possibility to edit addresses manually
• Simple and intuitive to use
• Secure storage and processing of your data. Only you and no one else uses your address information. 

Areas of application: Why use geocoding and what for?

Geocoding can be used in many business areas and now takes place in the background in numerous applications without us being aware of it. For example, every time we enter an address into a map application (e.g. Bing Maps, Google Maps), the address is geocoded in the background so it can be displayed as a point on the map.

Thus, geocoding is the basis for numerous company applications - whether as an address search tool in CRM and other databases, as a tool for address data analysis, as an address management tool or as a supplier of coordinates for location analyses, market analyses and geomarketing with GIS.

Companies geocode addresses from different business areas, such as addresses

• from customer databases and projects for the acquisition of new customers
• from locations of the branch network
• from warehouses, hotspots and other relevant locations within the supply chain
• from locations of the competition
• from points of interest

In combination with other company key figures and market data, geocoded address data provides the basis for numerous geo-analyses on sales, expansion, service and marketing issues. For these advanced geo-analyses, you need GIS software.