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Data Is The New Oil: 3 Reasons Your Business Needs Accurate Customer Data

Why is accurate customer data important? Let’s dive in:

As stated by Forbes, businesses that don’t maintain accurate customer data or fail to derive key marketing insights from the customer data they collect tend to fail:

“In order to succeed in business today, you have to go beyond selling products and services— you have to build and nurture relationships with your customers…thanks to technology, there are plenty of opportunities to learn about your customers and their needs, and regularly engage with them…Businesses often encourage consumers to provide feedback…and share purchasing preferences at every interaction. But when consumers feel that those revelations go unnoticed, they move on to more engaged companies in a blink of an eye. Failing to listen to consumers has never been more detrimental to business success.”

Why Is Strong Customer Data Important?

Simply stated, bad customer data equals a lack of marketing insights. The absence of those insights equals bad customer experience—and bad customer experience kills business. Consider for example these customer experience metrics:

  • More than 95% of consumers say that customer service is an important factor in brand loyalty
  • Brands with “superior customer experience” on average generate 6 times more revenue than those with weak customer experience
  • Customers who abandon businesses for poor customer service cost U.S. companies approximately $1.6 trillion a year
  • More than 80% of businesses view customer experience as a “competitive differentiator
  • The number one reason customers leave businesses is that they feel “unappreciated”

What Are the Main Benefits of Effective Data Collection?

Why Data Is The New Oil: 3 Reasons Your Business Needs Accurate Customer Data

Every business is different, of course, with different customers, different goals and different marketing challenges. But the benefits of smart data collection—and the insights accurate data generate—is similar for the lion’s share of them. Specifically, a robust program of smart data collection and interpretation yields the following 3 critical marketing benefits:

1. You’ll Know Who Your Customers Are

Knowing what your customers care about and what their relationship with your business has been dramatically increases the odds they’ll buy your products and services. 

Consumers want to do business with companies that know who they are and what they care about. You can’t establish those kinds of relationships on the fly.  If you want to show customers you understand their concerns and want to help them solve their problems, you need to collect and effectively leverage accurate (“clean”) data that informs relevant, timely messaging.

2. You’ll Personalize Messaging

Your customers are not monolithic. They’re interested in different products and services, have different spending limits and want to be communicated with in different ways. With robust customer data collection, you can effectively segment your customer base to send personalized messages that acknowledge, for example, their name, or job title, or purchase history. 

Simply stated, that kind of market segmentation and message personalization dramatically increases the odds that customers will trust your business and buy your products. According to Mailchimp, for example, segmented (read, “personalized”) marketing campaigns on average reduce bounce rate by about 5%, increase open rates by almost 15% and boost clicks by more than 100%. That translates into more engaged customers—and more sales for your business.

3. You’ll Build Enduring Customer Relationships—and Increase Profits

So, you’ve effectively moved a new lead through your sales funnel and turned a window shopper into a new customer. Your job is done, right? Wrong.

That’s because it costs your business about 5 times more to acquire a new customer than to retain an existing one. And, according to Harvard Business Review (HBR), when you increase your customer retention rate by as little as 5%, you increase profits by as much as 95%. 

Simply stated, customer data collection and leveraging isn’t only about acquiring new customers—it’s also about building enduring customer relationships that inform word of mouth marketing (facilitating the acquisition of more new customers) and add to the bottom line. 

In Conclusion

The fact is robust data collection—and the marketing insights those data generate—can be the oil that fuels the growth of your business. But knowing the best ways to collect and utilize customer data can be both complex and confusing. That’s where we can help.

To learn more about the ways our data collection, virtual call center, and analytics services can give your business the insights drive success, contact us today.