What are your customers telling you about your business?
This question has always been the key argument for customer relationship management, or CRM for short. Capturing data about your customers can tell you how many people eat steak at your restaurant on Thursdays, or who buys polo shirts at your clothing store. It provides visibility about who is calling with customer issues, so you can improve your products and service delivery. And in an increasingly interconnected world, related tools such as identity graphs can now track customer behaviors across different vendors and channels – for example, who bought a product, with what credit card, after seeing it on a specific social media platform.
Perhaps most importantly, CRM does what its name implies: it helps you understand and manage the relationship between you and your customers. Good CRM also benefits the customer as well as your business. Done correctly, it represents a single view of the customer across all departments in the organization, to build a cohesive experience for these customers. Knowing who your customers are is strategic and personal at the same time, and its impact ranges from remembering their birthdays to driving customer growth and retention.
So how important is CRM data quality? Bad data isn’t just an annoyance – it is a real, make-or-break cost for many companies. According to a Gartner survey, users of one major CRM system disclosed that poor data quality cost their companies over US $8 million per year on average, with some respondents citing costs of over $100 million annually ! These costs range everywhere from time and money spent catching and managing these mistakes, all the way to losing customers to poor service or missed opportunities. For companies of all sizes, the amount of inaccurate or outdated CRM data ranges from 10% to 40% of their data per year.
Where does bad CRM data come from? A number of sources. For example:
- Fraudulently entered data: for example, customers who enter “Donald Duck” or key in a phony phone number to get a customer perk or avoid customer registration
- Errors at the data entry level
- Duplicate information
- The natural moves and changes that take place in business every year
Whatever the sources of bad data, simply waiting and letting it accumulate can quickly degrade the value of your CRM database, along with concomitant costs in human intervention as a result of invalid or incorrect customer records. And without a database management plan in place, and specific stakeholders taking ownership of it, the economic value of this data will continue to degrade over time.
While ensuring data accuracy is important, it is also one of the least favorite tasks for busy people – particularly for information such as CRM data. This is where companies like Service Objects come in: our focus is on automated validation and verification tools that can run through an integrated API, a batch process or a web-based lookup. These tools range from simple address and phone verification all the way to lead and order validation, a sophisticated multi-factor process that ranks a customer’s contact information with a validity score from zero to 100. All of these tools validate and cross-verify a contacts’ name, location, phone, email address, and device against hundreds of authoritative data sources.
CRM data truly represents the voice of your customer, and it can serve as a valuable asset for strategic planning, sales growth, service quality, and everything in between. Using the right tools, you can painlessly make sure that this data asset maintains its economic value, now and in the future. In the process, you can leverage technology to get closer to your customers than ever.