I. What Is Customer Data Management?
Customer data management, or CDM, is the process of collecting, managing, analyzing, and storing data on your customers. You can collect customer data from various sources, including forms, transaction data, customer surveys, and marketing analytics tools.
Customer data creates a holistic view of your customers. You can use it to develop customer-centric marketing campaigns that increase sales, improve customer retention, and strengthen customer relationships.
Only organizations that manage their customer data effectively can capitalize on this powerful information and use it to their advantage.
Understanding who your customers are, where they’re coming from, and what drives their buying decisions is vitally important to your long term success. Implementing a solid customer data management system allows you to utilize this data better to improve your products, services, and processes.
II. 6 Tips for Stress-Free Customer Data Management
Here are six best practice guidelines to ensure your customer data is accurate, organized, and stored properly.
1. Focus on Critical Data
Make sure you’re only collecting data that’s useful to your company’s marketing and sales goals. Not only can data overload be difficult and costly to manage, but collecting unnecessary data also makes customers suspicious and uncomfortable.
Remember, just because you can collect multiple data points doesn’t mean you should. For example, do you really need a customer’s physical address and email address? Data saturation can bog down decision making when you have to sift through irrelevant information unnecessarily.
Do a deep dive into your marketing strategies and survey your stakeholders about the data you’re collecting. Ask questions like:
- What department(s) use this data?
- Does the data contribute to achieving company goals?
- Could your company meet its objectives without it?
Perhaps more, less, or different data would be useful. Periodically assessing your company’s data needs helps focus on critical data and how you can capture it.
2. Keep Your Data Clean
Once you’ve eliminated all but critical data collection, make sure the data you keep is “clean.” Clean data is up to date and free of errors.
Data inaccuracy at the collection point can happen if you don’t have a defined data strategy with set parameters. Even confusion about a simple date format can cause errors.
On the other hand, data decay is common. Data decay happens over time as changes occur in email addresses, phone numbers, physical locations, and more.
Don’t let dirty data ruin your marketing strategy! A successful customer data management strategy uses data validation tools to perform regular “housekeeping” that updates existing data. The data then moves into marketing platforms that manage accurate data-driven marketing campaigns.
3. Avoid Data Silos
A data silo is a compendium of data kept separate from other data within an organization. This can result in data overlap and concerns about “dirty” data – data that is inconsistent, inaccurate or incomplete.
Data silos exist in companies when there’s a lack of cohesion or communication between departments or business units. When departments collect data without an overarching plan (when “the left hand doesn’t know what the right hand is doing”), data silos are almost inevitable.
Successful customer data management eliminates data silos by organizing customer data into a single source, making it useful for your entire company. Stakeholders can extract and manipulate the data for their own purposes, keeping the original data source intact.
4. Emphasize Data Security
Today, having adequate data security is of the utmost importance. While protection against hacking generally comes to mind first, data security means protecting your data from any unauthorized access.
When you’re collecting and storing customer data, data breach concerns are paramount. Corporate espionage, compliance, and customer trust issues are important, and you should take them seriously. In 2020, the average data breach cost U.S. companies $8.64 million.
When you gather personal data about customers, you need a plan to keep that information safe. Start by answering these three questions:
- Are you performing regular backups?
- Are you using a CRM?
- Are your employees trained in essential security measures?
Security breaches almost always decrease customer confidence in your company and can affect your bottom line. Investing in data security is an investment in your company’s future.
5. Comply With Regulations
As the public becomes more concerned with data privacy, government entities will enact laws similar to the California Consumer Privacy Act (CCPA) in the U.S. and the General Data Protection Regulation (GDPR) in the European Union (EU).
It’s now mandatory to get consent before gathering data about your customers online. These laws have changed the way companies both collect and store that data.
Your U.S. company can be subject to GDPR laws even if you don’t have a physical presence in Europe. To protect yourself from harsh penalties, you can employ either of these following options:
- Use consent management on your website
- Block EU visitors from accessing your website altogether
While the above laws differ, both require companies that collect user data to give users access to their own data. Users must be able to see what data you’ve collected and can request that you delete it. This process can be complicated if your data is not centrally stored.
Customer data management simplifies data storage and proof of compliance by aggregating customer data in one location for storage or deletion.
6. Prioritize Team Training
Without ensuring that your employees know how to collect, handle, and protect your newly clean and streamlined data, your best practices may all be for naught.
Prioritizing team training is key to maintaining a stress-free CDM program. Investing in long-term education and training ensures not only data safety but employee engagement and loyalty. Focus on creating thorough but easy-to-follow training programs that hold employees accountable while emphasizing adherence to best practice guidelines.
III. Invest In a Customer Data Platform
Having safe, clean customer data in one place isn’t sufficient to synthesize it into personalized, effective marketing campaigns. CM.com’s Customer Data Platform consolidates your customer data from various channels, displays rich audience insights, and fuels your ability to send personalized marketing messages.
Key features of the customer data platform include:
- Unlimited data sources that combine with our simple-to-use API
- Real-time segmentation that captures your audience based on real-time behavior, events, and profile features
- Complete integration with CM.com that connects your ticketing, contact pages, payment data, and more in one smart data warehouse
- Easy dashboards that compile all the insights you want in one dashboard
Customer Data Platform is part of CM.com’s Mobile Marketing Cloud, a full-service solution for managing customer conversations and support initiatives.