Most people screw up their nose when they hear the word data. I admit it, I used to be one of those people. I liked to think of myself as a words person, or that I am more creative and not good with numbers. When in fact, you don’t necessarily have to be good at numbers to be good with data, you just have to know how to read the data and not try and make the numbers work for you. If the data is correct, it will be very obvious, if the data does not support your cause, it will be equally as obvious. There is no hiding behind data in a digital world but these precious numbers, if used correctly, will allow you to be more adventurous, more creative and get better results. Which makes you very popular. Do you like data now?
There are many ways to interpret the word data when discussing it in a digital context. Data can mean your website analytics, data can mean your return on investment ratio, your sales and revenue figures, it can be how you describe your customers, supporters, clients personal information – your database. Data can be every statistic, every sale, every visitor to your website. Data is all powerful, if Content is King, then data is definitely the mischievous Queen who gets things done behind the King’s back (can you tell I’ve been watching The Tudors?).
There are 5 things you must always do to manage your data correctly.
1. Data Hygiene. For me, when I talk about data, I’m usually referring to our database of supporters or customers. The need to ensure your data is clean and accurate is paramount. A clean database means that the number of incorrect addresses, telephone numbers, mobile numbers, email addresses etc is minimal. Data hygiene, as it is know, should be high on your businesses list of priorities. There needs to be rolling programs in place to constantly be checking and updating your data – this can be done through survey’s, activation incentives, telemarketing. Data cleansing can also be outsourced to companies like Experian or Acxiom, who have databases of their own that they wash your data against to update it. This is often most effective when your database is still young. The more mature your data (10-20 years old for example), the harder it is to clean through external methods.
2. Data Warehousing. You can have the cleanest data in the world, but if you don’t house it in an appropriate place, it will forever be susceptible to being lost, to accidental privacy violations, to being out of date and most important of all, to not being used properly. A data warehouse is your source of truth. All of your customer/ supporter/ client details need to be kept in one place – this is to ensure the data hygiene as well as to know that all of the information you need is available, you shouldn’t have to source it from multiple places. Many businesses start off by using excel spreadsheets as their database, this is dangerous. Your customers data is the most important asset your business owns and you do own it. You have a (legal) responsibility to your customers to maintain their privacy and to keep their personal details safe and secure. A data warehouse, often known as a Customer Relationship Management tool (CRM), will help you protect, organise and segment your data.
Some of the CRM systems that I am aware of are: SalesForce, SugarCRM, Orange Leap, Oracle, The Raiser’s Edge (best in breed for not-for-profits), Sibel and there are many, many more.
3. Data Segmentation. You are able to segment your database using your CRM data warehouse, or if you do not have the skill in house, you may prefer to outsource this to data experts. There are many agencies that specialise in data management and segmentation. Segmenting your database is exactly what it sounds like. You take your complete database and you use a set of pre-defined parameters to split it into small groups, or segments. These parameters might be based on products purchased, it could be on sales figures (amount the customer has spent), you may choose to segment on demographic information like gender and age.
You need to think very carefully about how you want to segment your data before you do it. You may have a distinct niche and know your audience well therefore choosing to separate your data to meet your long term needs. Perhaps you have only one product but it can appeal to different people for different reasons, so you might segment your audience so that you can communicate with each target market in different way. You may want to segment your data differently for every campaign, so you need to ensure that your data warehouse allows you to have this flexibility. Data segmentation ensures that you acknowledge that your customers are not all exactly the same. Some products, services and messages are not relevant to a portion of your database. For example, your business may develop several hygiene products and one of those product may be tampons. Would you send the men in your database a message about tampons? I don’t think so.
This is why data segmentation is so important. Data is a game changer, it is the difference between a business who breaks even and a business that thrives. Data segmentation can improve the perception of your customer at the other end of your marketing campaign. Impress them by how relevant you can be, by how much you know about them. Of course, try not to be too big-brotherish about it or people start to get concerned.
Data takes all of the guess work out of business, the numbers clearly tell you which campaigns, promotions and products work and those that don’t. If you use your data correctly, the only mistakes you will make will be in small, experimental, testing campaigns.
4. Data Reporting. Surely this is simple and obvious to everyone. If you have all this data, you’re cleaning, you’re warehousing it correctly, you’ve segmented it and have used it in your marketing. Surely you’re going to report on it? Seems simple but so many businesses put weeks and months into the planning of a campaign but by the time its in market, they’re onto the next campaign and have forgotten to report and measure the effectiveness of the previous campaign. Reporting is a matter of imputing sales data, contact logs, products purchased, conversion rates etc back into your CRM data warehouse and analysing the information. Use your CRM as your source of truth. Clean and segmented data doesn’t tell you anything if you don’t look at it.
Consider investing in an analyst, they will be expensive, but they should save you thousands in disasters averted if not millions in identifying the biggest opportunities for improved conversions.
5. Research. Perhaps research should be at the beginning of my 5 tips for data management but data is more like a cycle of events than a list. Once you have your data warehouse in place and you’ve started reporting on all of your campaigns you will have an immense amount of data coming back in. Your Google Analytics data will be a good point of reference to check your CRM data against. As some users delete their cookies and others use multiple computers or mobile devices, you need to allow a degree of discrepancy, but you should see the same trends in your CRM data as in your web analytics data. All of this data is research gold. Next time you’re planning a campaign, you start by researching what worked previously. You have all the data you need to make informed decisions. You will be able to convince your executive stakeholders of the validity of your idea because you have the data to support your argument.
Using your business data for research should always be the starting point for any new endeavour. And if you have the budget and the inclination, investing in external data sources is also recommended. If you have an online business, Nielsen Online, and Hitwise Market Intelligence are usually your first port of call but there are other providers out there.
Remember, data doesn’t have to be a scary word. Data should be insightful and exciting. Data should support, and sometimes challenge you, but it should always be considered a valuable resource and of great importance because it can lead the way.