Every business needs happy customers. After all, your aim is to grow your customer base and have a long list of happy and content clients. The only way to make this possible is to offer clients exactly what they want.
Businesses gather data from a variety of sources in order to understand their clients better and provide them with what they need. However, this data can often be very difficult to manage.
Poor data management and collection is a recipe for disaster given the huge impact it can have on your business. According to reports, bad data can affect revenue by about 12%. This is a huge figure which also indicates the need to take steps to collect and manage data in the right way.
In this article, we’ll talk about how bad customer data can impact your brand and what steps you can take to control it.
What is Bad Customer Data?
Customer data is all the data that belongs to one or a group of customers. Businesses need this data to offer personalized services to each client. Plus, they also use this information to improve current product and come up with better ideas in order to cater to the growing needs of their customers.
It is vital for every brand to know their customer base. However, bad data can make it a difficult task.
Bad data refers to incorrect, incomplete, outdated, or redundant information. Let’s talk about how such data can affect your brand.
How Bad Customer Data Can Impact Your Brand
Bad data affects everyone involved – from business to customers. Let’s talk about the impact in detail to know how bad customer data can impact your brand:
● Decreases Loyalty
Branding is largely about loyalty. Think of Apple customers, they are said to be the most loyal set of customers. While some may not agree, the fact remains that loyal Apple customers would spend money on Apple products just for the brand name.
Experts believe it has a lot to do with how Apple handles data. It makes customers feel special. You can find information about your product just by entering the serial name on the official website. All the data is stored safely and securely.
Customers know they are dealing with a professional company that’ll take care of their data and provide them with products that are useful and reliable.
Similarly, think about Uber which lost a large number of users after its system was breached. In fact, some reports suggested the company was struggling to find drivers. It even had to pay millions to the authorities due to its failure to make the hack public.
Such instances can affect loyalty and cause businesses to take a hit. Of course, you would not want such a thing to happen to your business. This is why it is important to take care of your data.
● Increases Cost
Bad data can make it costly to run a business. Poor data costs the economy above $3.1 trillion every year – in the US alone. This is through multiple sources including poor decisions, lost revenue, additional server costs, inefficiency, compliance issues, and so on.
Such issues do not only add to the cost but can also affect your brand. Think of Facebook. It was under fire for poor data management and the matter even reached the government.
While the exact number is not yet available, the event caused several users to boycott Facebook, even causing the share price to take a hit. Things might be okay now but you cannot deny the fact that such instances can hurt a brand’s image.
Even NASA had to suffer a loss of $125 million due to a miscalculation.
Not all businesses are strong as Facebook or NASA and some may not be able to handle such situations.
● Breaks Connection
Poor data management and collection can cause businesses to lose connection with their customer base. Businesses use a variety of tricks to stay in touch with clients.
Actions such as sending greetings on special occasions or letting customers know about the latest discounts and offers do not only help retain customers but also strengthen the bond.
However, poor data management can affect this in a major way. Imagine saving customer names incorrectly. How would a customer feel if you greet him or her with a wrong name?
They’d look at you as a poor company that can’t even manage data correctly. It can affect your brand image and cause sales to take a hit.
● Affects Goodwill
Bad customer data can affect your goodwill, not only in the eyes of customers but also in the eyes of the industry.
Refer to the December 2015 U.S. voter database hack that affected over 19 million voters.
The incident caused voters to lose faith in the government and it affected the authorities in a very negative light. Surprising was the fact that the hack became a possibility due to human error.
The database was not properly configured, making it easier for hackers to break into the system. They were able to get access to private information of registered voters throughout the country.
● Reduces Morale
As mentioned earlier, poor customer data does not only affect your customers but your employees as well. It can cause employees to feel low and lose morale.
This can have a very negative impact on your business. Employees who are not motivated enough will never be able to put their 100% into the business, resulting in poor productivity, bad customer support, and other such issues.
All these combined can affect your brand. This is a major reason why businesses should take steps to manage customer data.
● Loses Customers
Bad customer data can cause businesses to lose customers. You need to know and remember details about your customers including their preferences.
According to a report, about 45% of customers would move to a different platform if the business reaches them through a channel that they do not prefer.
As a business, your responsibility is to gather, maintain, and use this data so that your customers get the service that they demand.
Poor recommendations or incorrect information shows a lack of care and can affect even the most loyal customers.
● Results in Poor Lead Generation
Poor customer data results in poor lead generation. How do you expect to turn potential customers into customers if you do not have access to the right data?
Imagine having a list of incorrect names or emails. You will end up calling the wrong people and have no success.
Customers need the right message for any marketing campaign to be effective. It is not only about the wording, it is also about who hears these words and how.
Years of research comes into play here. However, if the research contains incorrect data then your entire campaign would fall apart. Coke had to feel the heat when it launched a new product in the ’90s after years of research but it failed to generate revenue due to there being bad data.
Poor customer data can hamper the ability to segment your clients properly. It can also affect performance metrics and wreak havoc on personalization tactics.
In the end, you will end up wasting a lot of money and time but without receiving good results.
Bad data has caused some very successful companies to fail. One of the biggest such examples would be Enron, the then sixth-largest energy company in the world, which had to file for bankruptcy in 2001 due to bad data.
Now that you know how bad customer data can impact your brand, let’s talk about some challenges involved in data management:
The Challenges Involved in Data Collection and Maintenance
It is not easy to collect and maintain data. Customers do not want to share personal information, especially with a bsuiness they do not trust. Similarly, maintaining this data can be troublesome as well. Hacks are common. Plus, you can lose data due to poor management and handling. According to reports, human error is the number one cause of the loss of data. These including typing errors, matching errors, duplication errors, etc.
Being careful and taking the right steps can prevent you from having to face major losses.
How WinPure Can Help
WinPure is a professional data cleansing and matching software that is suitable for all kinds of businesses. The software is designed to correct, clean, and standardize all data. Plus, it can also remove duplications and take care of your mailing/marketing lists, CRM, spreadsheets, databases, etc.
Knowledge workers spend 50% of their time finding, fixing, and searching data for mistakes. They also have to spend a lot of time in verifying data. Similarly, data scientists spend half of their time organizing data. WinPure can reduce the burden and do this and much more on its own.
This award-winning software is quite reliable and easy to use. Major companies like Emirates, Vodafone, Bank of America, and McAfee use WinPure to keep their data safe and correct. However, we also cater to small businesses.
Go here to download a free trial and try the software.
We understand how bad customer data can impact your brand and offer discounts and volume licensing. Get in touch with us today to talk more about your requirements.