"Consumer data will be the biggest differentiator in the next 2 to 3 years. Whoever unlocks the reams of data and uses it strategically will win."
–Angela Ahrendts (Senior VP of Retail at Apple Inc)
In this digital era, where there is an equal level of competition among business owners, the one who gains the maximum customers rules the digital market.
By studying customer anatomy, (i.e., their desires, interests and expectations about the company and its products), you are bound to yield extraordinary results for your digital business. There are multiple ways to collect customer data (i.e., forms, surveys, social media, transactions, tracking pixels, analytic tools, etc.), but positively managing all these factors requires customer data management in the best possible way.
What is Customer Data Management?
Customer Data Management (CDM) is the procedure of accumulating, organizing, scrutinizing, and later storing customer data to improve the company's customer-centric focus, which in turn helps in the business's success. Understanding customer preferences and buying patterns, paired with their expectations, makes you a leader in the digital market.
Importance of Managing Customer Data
Customer data is a major asset to a company, and hence it should be appropriately maintained. What is the use of data if it is misplaced, outdated, or not accurate? Inaccurate data can ruin a company's reputation, whereas precise customer data can help promote products in a customer-centric way, increasing sales and customer relations. It helps in retaining customers, too.
In this article, we'll discuss some tips to manage data effectively for soaring business profits.
Tips to Manage Customer Data
- Take Security Seriously:
- Research by Help Net Security indicates that 83% of the companies experience email data breaches.
- The data breach cost (2021) is estimated to reach $6 trillion annually.
- Cyber-attacks lead to the closure of 60% of the companies within six months.
Shocking, isn't it? It's simple to collect sensitive information from customers, but the tricky part is maintaining data privacy by securing the information. The security assurance of information helps develop trust and improves customer relationships.
Apart from the many web securities which help secure data, it is strongly recommended to use SSL certificate encryption security for data privacy. This digital certificate provides 256-bit robust encryption of data-in-transit between the browsers and servers.
Encrypt all your credit card numbers, passwords, and other sensitive information of your clients and ensure that your customers know the same.
Harden your servers, patch your software to escape security vulnerabilities and build a strong reputation for your company.
- Gather Information Ethically
The expanse of digital technologies has encouraged many companies to gain customer data for their product promotions. Although many companies prefer to be transparent about their data collections policies, many companies have a concealed approach to acquiring customer data.
Trust works wonders, specifically when private information needs to be extracted from customers. To build a robust company-client relationship, transparency of collection policies needs to be maintained.
Tips to Collect Customer Data
- Distribute survey forms to customers.
- Google Analytics
- Track social media likes, comments, etc.
This ensures customers of their data privacy and keeps them loyal to the company.
- Decide What You Need
Having massive customer data is not essential; what matters is the relevance of the data. Irrelevant or bad data may prove unfruitful for the company. They are responsible for wastage of funds and resources and can adversely affect your business, leading to losses.
Studies indicate that 52% of the data collected by companies is unused and not valuable.
Think of ways to gather relevant data which can be utilized in the best way.
Tips
- Only collect needed information, i.e., if an email ID is required, no need to collect the contact details.
- Trace customer interactions.
- Trace social media reviews about your company.
- Update data regularly.
A systematic, accurate, and transparent approach to data collection will help gain better conversions and ROI.
- Invest in Customer Database Software:
In the past years, customer data was managed in Excel spreadsheets or physical papers. With the rise in digital technology and the rise in cyber-threats, businesses are storing their information in a secured Customer Relationship Management system.
As the name defines, this system manages customer data by driving sales, delivering actions, amalgamating with social media, and communicating with the team.
Many cloud-based CRM systems come with ample benefits, the main advantage being the single place for data storage. This helps in enabling strong security too.
- Back Up Your Data:
The world generates 2.5 quintillion bytes of data daily. These massive amounts of digital data determine the success or failure of a company. Since sharing digital data is easy, the chances of its vulnerability are also high.
Hence, backup of customer data or any other data is essential in case of contingencies or unwanted disasters. Depending on the security budget, please choose the best cloud backup services for your data and shield it against hackers.
- Train Your Team
Your employees or your teammates need to be aware of the latest cyber threats to protect customer data. In the next stage, they need to be briefed about securely handling the customer data.
Ensure that company policies regarding protecting sensitive information are strictly coordinated with employees, BYOD is implemented, and the concerned employees are penalized for the same in case of blunders.
- Allow Customers To Opt-Out
Customers are moody and many times like to opt out of the company's promotional mails or products. Though they have given a green signal for utilizing their data, sometimes they wish to opt out of the company.
Keep the way clear for the customer by permitting them to unsubscribe emails or promotional fliers, or any other notifications if they wish to opt-out.
- Monitor Your Data
Never leave customer data unattended. Delegate the task of monitoring customer data to an honest employee, who keeps a check on manipulating data or a deliberate or accidental deletion to prevent data loss.
- Limit Access of Database
There is a well-known saying: "Too many cooks spoil the broth." Access to the customer database to all employees increases the risk of manipulating data or passing data to competitors. Corrupt employees are on the lookout for such loopholes to fulfil their evil desires. This, in turn, leads to the loss of client data.
Limit customer data access to avoid these disasters. As said before, designate a trustworthy employee for data handling and give authorization rights to them only. In case data needs to be shared, ensure that the same is in read-only format.
Final Words
After the task of managing and securing customer data is successfully handled, try turning your customer data management plan into a profitable venture.
Your digital business is bound to succeed if you can convert customer data into a sales conversion to create a loyal customer.
