You can use data in your CiviCRM database to set up mail merge communications both for emails and printed materials such as letters and mailing labels. The mail merging functionality relies on Tokens, which represent items in your database. This chapter explains how tokens work and how to use them in generating printing materials. Using tokens in emails is further addressed in the Email section of this book.
Tokens are the equivalent of mail merge fields in CiviCRM. This means that it is possible to insert information from the database into an email or a letter that is different for every recipient. For example, use the Postal Greeting token to include a customized greeting for each recipient in your PDF letters. Most contact fields, including custom fields you've created, are available as mail merge tokens. You can view available tokens by clicking the Insert Token link in the top right corner of the message editing area.
Most of the tokens contain information that is in the database fields. However, there are some special tokens that accomplish specific tasks in emails, such as a link to an opt-out page or link to choose mail formats. Some tokens are only available for mass mailings, such as the token to provide a link to a message stored online.
A particularly useful token is the checksum. The checksum allows you to give people links to contribution forms, profiles, petitions, and event registration forms that are prefilled with information that is already in their contact record. The image above shows an example of this.
Only contact fields and actions can be inserted in your email as tokens. Related records, such as the name of the event for which the contacts have pending enrollments, cannot be included. However, you could provide a link to the person's contact dashboard so that they can review their registration details for themselves (once logged in), or you could use a checksum token to allow access to a profile through which they can modify their information without having to log in.
Go to this page for further details on using the checksum token: http://wiki.civicrm.org/confluence/display/CRMDOC/Tokens.
It is also possible to have custom tokens created by a developer. For instance, the total amount of contributions from a contact. To find out more about working with custom tokens, refer to the discussion about custom mail merge tokens in the Hooks chapter of the Extending CiviCRM section of this book and look at the wiki: http://wiki.civicrm.org/confluence/display/CRMDOC/Tokens.
Another task for a developer is to create if/then logic for your mail merge. This is done using the smarty template language as described here http://www.smarty.net/docs/en/language.function.if.tpl.