Good business decisions are made based on the data available to your business. So when the data is wrong, this will lead to misinformed choices that ripple throughout the business and cost you money. Similarly, if your database or CRM system is out of date, then your marketing campaigns will be under-performing and resulting in costly, inaccurate mailings and campaigns.
Data cleansing (or data hygiene) is an effective way to check and correct your customer information, assuring you get the most from your database and helping towards ensuring you are GDPR-compliant. You’ll also be able to make business decisions with confidence.
A cleansed and enhanced database:
- Reduces marketing costs
- Increases response rates
- Ensures legal compliance
- Eliminates duplication
- Improves accuracy
Top Tip #1: Ensure regularity of data quality improvements
Two statistics that every marketer should be aware of are:
- Data decays by more than 30% every year
- 90% of the world’s data has been collected in the past 2 years
When you consider these two statistics, it is paramount that you put in place a programme for continuous data cleansing and enhancement. As well as ensuring you remove non-relevant data, the exponential rise in big data collection from the ‘internet of everything’ means that there are always new ways to analyse your customers and better engage with prospects.
At Blue Sheep, we recommend that you cleanse and enhance your full database every three to six months to ensure that you know precisely how many customers and prospects you’ve got, understand your data better and ensure that all your business decisions are well informed.
Ensure that data hygiene features in your marketing and budget plans each year and create a programme of continuous data cleansing and enhancement.
Top Tip #2: Do not be precious about legacy customers
When we look at customer or client databases, we regularly come across historical customers that are retained to promote a higher customer number than the business actually has.
If someone bought your products or services six years ago but are no longer in business, or in many cases we’ve seen are deceased, this needs to be applied to the database.
We all want to boast about our large client base and show success. But when marketing produce upsell campaigns or spend weeks authoring customer newsletters, you need to be sure that the time is well spent and the targets for responses and conversions are realistic.
In the example of one company selling products to SME construction companies with the business owners’ average age being between 45 and 65, we found that their customer file of 15,000 contacts included over 1,500 deceased business owners - and almost 5,000 that had gone out of business during the recession. This equated to over 40% of their customers that were being included in email and mailing campaigns, costing the business tens of thousands of pounds.
Top Tip #3: Put in place good deduplication and merging techniques
Keeping a high quality of data can feel like a thankless task when data entry is at the mercy of sloppy salespeople. Many CRM systems and databases include merge tools and deduplication systems allowing you to match records that look similar. This is great, but what happens if you merge two records that are not actually the same?
The one thing worse than ‘duplicates’ is ‘false positives’!
A false positive is when you merge two records that are actually not the same person. This can happen when the existing data is not extensive and can lead to illegal practice if you merge an opted-out recipient with an opted-in recipient. It also reduces the size of your customer/prospect list and often the information lost in the merging process cannot be reclaimed.
Spend time thinking about some strict processes and rules for deduplication and merging - you’ll benefit in the long run.
Top Tip #4: If you’ve got hard bounce reports then USE THEM!
If you do lots of email marketing (most of us do) then make sure you are utilising the reports that come from most good email service providers (ESPs). If you generate hard bounces from your emails then use that information to remove email addresses. You probably generate a lot of information from your ESP about locations, devices used, open times, click times and many other metrics. This is big data at your fingertips and hugely underused by many organisations that are too concerned with getting email after email out of the door.
It is every marketer’s responsibility to keep their data cleansed and updated, and hard bounces are another way to cleanse your own data. This helps your response rates, keeps data clean, provides you with better results and reduces costs.
If you send your data to Blue Sheep to get cleansed, you can probably remove lots of the email addresses yourself before sending it just by spending some time with the reports in your ESP! Again, you’ll spend less money on cleansing and save even more budget!
Top Tip #5: Understand the 80:20 rule when looking at data marketing
Data marketing takes time and resources to get it right. Data governance takes time to enforce, and cleansing and enhancement can cost money. When marketing budgets are tight and under-resourced, the temptation can be to continue as you are and keep running at a fast pace with conversions and response rates never quite hitting the desired level.
The Pareto Rule tells us that we should spend 80% of our time on 20% of our customers – the high spending, long lasting customers. However we often work in reverse and apply all our efforts to prospects that are going to yield very little. The most successful and profitable companies across the world undertake data segmentation to produce a profile of their most profitable customers and then spend their time going after those. This takes less effort, provides more revenue and is ultimately more efficient.
My final ‘top tip’ is to look at data segmentation and data enhancement as a way of understanding your customers better, and build a better profile of your best customer. Using that insight can inform all future marketing decisions, allowing you to find the right prospects and exceed targets consistently.
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