Implementing a Single Customer View can be a costly endeavour and any organisation doing so is going to need to justify how such an investment will benefit their business.
Fortunately, making your marketing more effective and efficient is one of an SCV’s key strengths and there are many short- and long-term ways that it can help you save money. There may even be a few you had not originally considered.
The costs associated with bad data
A Single Customer merges and matches different data types, ensuring that it is kept clean, up-to-date and relevant. This also means it eliminates some of the costs associated with dirty data.
Take direct mail campaigns as an example. A database that has not been unified by an SCV is likely to contain many inaccuracies, such as incorrect names and addresses, overlooked suppressions and duplicate records. According to statistics gathered from Econsultancy, the average organisation estimates that 22% of its contact data is inaccurate.
So, a direct mail campaign costing 45p per mailpack to 200,000 customers could see a business wasting £19,800 on undelivered, incorrectly targeted messages. And that doesn’t even take into consideration the immeasurable costs associated with disgruntled customers who have received something they feel is irrelevant to them, or worse, multiple times.
The costs associated with data cleansing
While an organisation will require an initial data quality strategy before the information is fed into an SCV, maintaining the integrity of this data will be much easier once a Single Customer View is in place. This means there will be no need for a dedicated Data Cleaner picking through the data by hand. A quick glance at recruitment sites suggest salaries for such a role start at around £17k per year.
An SCV can also encourage a business to assess how it collects data in the first place, and ensure that new processes can be put into place at the initial point of input.
The costs associated with Data Subject Access Requests
While it may not seem important right now, the arrival of the General Data Protection Regulation (GDPR) in 2018 could make this a very significant cost soon.
Current laws enable individuals to request all the marketing data an organisation holds on them. Currently, completing one incurs a charge and it can be delivered within 40 days. Under new rules, Data Subject Access Requests (SARs) must be supplied free-of-change and within a month.
If an individual can establish that your company has collected data unlawfully, they are entitled to claim compensation. While this figure might not be much, if your customer database contains millions of records then the numbers really add up.
However, the legality of your data collection methods is not the issue here. The costs will come from the administration costs processing a SAR. If it takes several hours for a qualified member of staff to extract and present all this data for each record, processing even just a 100 requests has a significant monetary impact.
Again, this is where a clean, consolidated customer database will help streamline the time and afford required to complete a SAR. While it will not completely remove the cost, an SCV will not only mean your customer records are more likely to have removed any offending opt-outs and suppressions, the data will be more readily available for you to extract.
The costs associated with customer retention
The Harvard Business School Press claim that it costs five to ten times as much to win a new customer as it does to keep a customer, and a 5% increase in customer loyalty can translate into a 75% increase in profitability.
With a Single Customer View, more targeted communications and better knowledge of your customers means not only an increased likelihood of retention, but more opportunities for cross- and up-selling revealed, too. So, money that a marketing department might have spent on acquisition can instead be channelled towards cultivating customers that are more valuable.
Whether you are a marketer getting to grips with the concept of an SCV, need to know what your organization needs to consider before building one, or want to better understand the ROI, Blue Sheep's The Ultimate Guide to Single Customer View has the answer.