Data failings put half of SMEs at risk of violating GDPR

GDPR_2020Nearly nine out of ten (85%) of the small- to medium-sized businesses (SMEs) in the UK are now familiar with GDPR, but more than half are still not cleaning their customer data in direct breach of the regulation’s legal requirements.

That is the damning conclusion of a survey of 1,110 SMEs, conducted in June by marketing data and insight company REaD Group, which also found that only two-fifths (40%) hold their customer and prospect data in a CRM or other database.

The company argues that this is a low figure given that businesses need to maintain contact with their customers for sales and marketing purposes, and never more so than over the past 15 months.

A quarter (25%) of those with a CRM system indicated they did not run data cleaning or update processes: this rose to more than three-fifths (61%) of SMEs overall. GDPR – or UK GDPR as it is now officially known – requires all customer data to be clean and up-to-date in order to be compliant and legal.

However, the survey did reveal that awareness of GDPR is high: 85% of all SMEs said they were familiar with the regulation, regardless of whether they had customer data in a CRM or other database.

Of those with a CRM system or database, only 6% were not familiar, meaning that the majority of those who hold customer or prospect data are familiar with the regulations governing storage of that data.

Four-fifths (80%) of all respondents were aware that GDPR requires data to be kept clean and accurate or be deleted: although this still leaves one-fifth of SMEs who were not.

Direct mail remains a popular form of marketing, with just over two-fifths (42%) of all respondents confirming they use physical mailing for communicating with and/or marketing to their customers.

Three-fifths (60%) of SMEs with a CRM system carry out physical mailings, while 30% of those without a CRM also carry out physical mailings: it is likely that these communications are not well targeted, the report claims.

REaD Group customer engagement director Scott Logie commented: “It was positive to see that awareness of GDPR and the requirement to keep data clean and accurate (or else delete it) was so high among the UK’s SMEs, which would indicate that the GDPR has firmly embedded itself.

“But while the majority of SMEs with a CRM system or other database were aware of the need to clean and update or delete their data, there are still a significant proportion who must ensure they run the necessary cleaning or updating processes required.

“We were also intrigued by the fact that only 40% of SMEs hold their data in a CRM system or other database. Irrespective of the format it is held in, centralising the customer data a company holds into a database is important, because it makes the storage, management and upkeep so much easier and, as a result, any marketing processes so much more efficient and effective too.”

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