Mail merge is a tool which allows you to create letters, mailing labels, and envelopes by linking a main (common) document to a set of data or data source. The main document is linked to the data source by common fields of data, called merge fields. You can create your own merge fields, specific to your data source, or you can use a predefined set provided by Word.

For example, in a letter, your main document would be the letter informing the person they have won money, or their car is due in for an oil change. The data source is where the fields of information on each client receiving the letter are located. The data source would contain names, addresses, account numbers, date of last service, etc.

If you were printing envelopes or address labels, the main document would be the envelopes or the sheet with labels on it; the data source would be the addresses that are to be placed on these envelopes or labels of sheets. 

(i) The mail merge process entails the following overall steps:

Set up the main document. The main document contains the text and graphics that are the same for each version of the merged document — 

for example, the return address in a letter.

Connect the document to a data source. A data source is a file that contains the information to be merged into a document.

For example, the names and addresses of the recipients of a letter. 

Refine the list of recipients or items. Microsoft Word generates a copy of the main document for each recipient or item in your data file. If you want to generate copies for only certain items in your data file, you can choose which items (or records) to include.

Add placeholders, called mail merge fields, to the document. When you perform the mail merge, the mail merge fields are filled with information from your data file.

Preview, change individual documents, and complete the merge. You can preview each copy of the document before you print the whole set. And you can change individual copies of the document.