For years companies have focused on gathering customer data, with the view of “the more information the better”. The problem is that now there is so much data in CRM systems that it’s unknown what’s up to date or what’s no longer relevant. As a result, it’s hard to trust the data and make informed decisions.
No company wants to invest in a campaign, only to have it backfire because they’ve targeted the wrong people or referenced the wrong product. This happens all too often because lists aren’t clean and haven’t been maintained. A CRM system is only as good as the data it contains and if that data is outdated, it is not possible to make good decisions – especially not when you’re trying to grow a business and drive results.
When this is the case, it’s time to do a spring clean and get back to a point where you can trust the data in the CRM system. Here’s how to go about it:
What Data and Why?
A classic pitfall is to collect data because of the mindset: “Wouldn’t it be great if we had all of this information…” Client files end up with more than 300 fields, most of which are empty and irrelevant. After 10 years there’s a massive amount of data, but the quality of it is poor.
A better starting point is to instead ask this question: “If we have this data, what will we do with it?” This gives the process perspective and sets up guardrails to only focus on data that is useful and relevant. The key takeaway here is that collecting customer data needs to be tied to the strategic goals of a business. Take the time to understand what you need the data for and how having that data will help you achieve specific outcomes.
For example: A common reason that companies have for wanting to clean up their CRM system is that they want to drive growth by cross selling to existing customers. This is indeed a sound and proven business growth strategy as it’s significantly easier to sell to customers already familiar with a company. But in order to succeed in this type of campaign, the data has to be accurate. If a company cannot quickly generate a list of all their existing customers and what they’ve bought recently, how will you know who to target and what to offer them as part of a cross selling campaign?
Who Owns the Data?
Once you have a better understanding of what data you need and why, the next step is to assign ownership. Best practice is having limited access where only certain people can make changes or update information. Additionally, manage updates in the CRM and then push data out through other system integrations. This is critical because if updates are made in other systems, it won’t necessarily update in the CRM and there is no longer a single source of truth that can be trusted to make informed decisions.
The responsibility for having data that can be trusted is best managed by one or two people who need to come with an understanding of why the data is needed.
For example: The head of purchasing may look at existing customer data to make decisions about purchasing supplies three months out. They’re relying on the data to be accurate because they’re using it to forecast business needs and spending money on that basis. If the data is not up to date, they might purchase too much, resulting in waste. Conversely, if they purchase too little then the company may not be able to operate efficiently.
Establishing ownership of managing data translates into a higher level of accountability and better quality of data.
What Do You Do with Data That’s No Longer Needed?
Having fields that capture a customer’s birth date, for example, may seem like a good idea, but unless it’s part of an active campaign where birthday cards are sent out every year as a way to engage with customers, the information is not useful and it’s just cluttering up the core CRM system.
Having identified that this type of data isn’t relevant to the current strategic business, the question remains: What to do with it? As a general rule, never delete data, rather archive it as you never know if you may need it in the future. Archiving is relatively inexpensive and ensures that no data is lost. By having an archive process in place, it also helps keep the current data accurate. You know that what you’re working with can be trusted for decision making.
Capturing Data Going Forward?
Having a CRM that you can quickly draw data sets a good foundation, but businesses evolve. What are the best practices for adding new information to the database? Imagine you’re generating leads from your website. Typically, that information will be fairly basic such as a person’s name, an email address, and a company name. You could ask for more information such as their position in the company, but this reduces the chances of them submitting the form. Instead, when the form generates through, set up a filter that triage’s the contacts and augments the information through research and third-party apps. This helps identify which are opportunities worth pursuing before passing on those leads to sales, making the data more actionable.
Ultimately the goal of creating a database of customer information is to be able to use it to grow the business and achieve strategic objectives. When this remains the core focus of CRM, it is easier to keep a database clean and have information you can trust.