Dirty data ‘costs firms up to 6% of annual revenues’

rip up data and start again firms toldThe war against poor quality customer contact data has been raging for decades but few have managed to put a cost on it, until now that is, with a new study by Royal Mail Data Services claiming it could be costing UK organisations as much as 6% of their annual revenues.
This is despite recognition, among around 300 marketing, data and analytics professionals which took part in the study, of the importance of quality data. For the second consecutive year, they cite good-quality customer contact data as having the greatest positive impact on campaign response and conversion rates.
Furthermore, comparative analysis shows that specific data issues have continued to rise since 2014. Notably, duplicate data (which has increased 22% in the past two years), incomplete data (up 13%) and out-of-date data (up 12%).
This year’s survey also revealed that more than a third (37%) of businesses lack any formal processes for cleansing their data, while nearly one in five (19%) do not validate customer contact data at the point of data capture.
Some 38% of marketing, data and analytics professionals say their efforts to overcome these challenges and improve the quality of customer contact data are thwarted by legacy IT systems. This can also limit or even prevent the level of personalisation which marketing is able to deploy.
This year’s research report, The Six Per Cent Solution = How Better Customer Data Drives Marketing Performance & Business Growth, reveals that the average rate of churn has remained at 20% a year. It is not surprising that, as a result, customer acquisition remains top of the marketing agenda; 52% of organisations say this is their biggest challenge.
Royal Mail Data Services managing director Jim Conning said: “Our study has revealed that poor-quality customer contact data directly impacts the bottom line. Espically as one in five customers need to be replaced each year. Marketers need to work harder to build value in the minds of their customers and stop them from moving on to a new brand or provider. Good-quality customer contact data is critical to tackling both these challenges.
“The lack of consensus within organisations about how to approach the data problem is holding them back. Breaking down silos and ensuring that marketing, data and IT work together to tackle the data-quality challenge should be top of the agenda for any business.”

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