We spend a great deal of time collecting data. Data itself remains a primary talking point within the marketing industry. We’re all supposed to be amassing this massive cadre of information about our customers, potential customers and competition.
Data on its own is meaningless. It’s a lot like dumping a pile of topsoil on your driveway. The topsoil has the potential to grow trees and gardens, but unless you know how to use it, it’s simply a pile of dirt.
The goal of any commercial venture is to put boots on the ground. Your business needs customers. Whether it’s orders placed through your website or foot traffic in your brick and mortar location, this goal hasn’t changed much since human beings began selling things to each other. Our ability to collect copious amounts of information is supposed to help us achieve that goal. Instead, most of us ignore it.
If you’ve been in business for any length of time, you’ve likely been approached by many companies scaring the living daylights out of you by warning that your business isn’t collecting enough data. But how much is enough? And how in the world do you begin to sift through it all?
DATA NEEDS TO SERVE A PURPOSE
This statement seems on the surface to be ridiculous. Of course data needs to serve a purpose. But for most of us, we’re collecting data simply because we can and we’ve been told we should. Every piece of data you collect should have an end point. Why else are you collecting it? Data doesn’t lie. It shows us where we’re succeeding and, more importantly, where we’re failing. Data is only a pile of topsoil until we use it for planting.
DATA ALLOWS YOU TO SEE TRENDS
One of the primary uses of data is to view trends. A product-driven organization can see clearly and almost instantly what sells and what doesn’t. Information organizations such as news sites and entertainment companies can spot trends and provide content that is most desirable for their audiences. The types of trends your data can show depends on your business. From straightforward data trends such as abandoned shopping carts to where a user drops off your website, to more complex data algorithms that monitor traffic patterns, peak demand and negative feedback, there’s a tremendous value in data.
For people who slept through algebra class, data analysis can seem daunting. Analyzing data is a learned skill. It requires an analytical mindset. Part of the fun of data analysis is looking for the obscure. Data isn’t only derived from inbound marketing. If you’re going to follow a transaction life cycle, you need to have information for the whole cycle. That includes your outreach (your advertising campaigns), behavior during the transaction, questions or comments during an online chat or through your sales staff, sales data, customer reviews and comments, and product defects and returns. Your business may have different touch points. Effectively using your data requires you to understand where these touch points exist.
DATA COLLECTION OFTEN INFURIATES CUSTOMERS
Your customers watch the news. They read things online. They’re acutely aware that data breaches are an everyday occurrence. They’re becoming reticent to provide too many details. If you request too many private details, things like a Social Security number, a CVV code on a credit card, mother’s maiden name, etc., you will lose sales. There are many situations where confidential information is required. Customers used to provide that type of information willy-nilly. Today, requiring too much identifying information often leads consumers to search elsewhere. The decision process happens quickly. Too many questions, too many details, customers will abandon you.
Many companies try to harvest data that has little or nothing to do with the transaction taking place in order to fatten their marketing outreach. We build email lists in order to bombard our existing customers with promotional material. There’s a thin line between customer engagement and customer abuse. Do you really want to send e-blasts to customers who have no interest in what you’re promoting?
BE WARY OF STORING TOO MUCH OF IT
If the NSA, the IRS and the Defense Department computers can be hacked, trust me, so can yours. The law regarding responsibility for the inadvertent release of personal data is still catching up with real life. At some point, one of the lawsuits by consumers against companies that have been hacked will stick and precedent will be set. But whether or not your company bears legal responsibility for data breaches, your company will have to answer to the consumer. It may be through customer boycotts or even through increased costs to implement extreme digital protections.
How much data do you need? How much of it do you need to keep? How long do you need to keep it? What are you planning to do with it? Each of these questions needs an answer. If your business can’t answer these questions, it’s time to seriously look at the information you’re collecting.
DO SOMETHING WITH IT
You have at your fingertips the type of information Don Draper could only have dreamed about. Unless you use the data, there’s no reason to have it. Use your data to take action. If data trends are telling you that Product X is doing well during the ordering process but has a 45% defect rate, you should be focusing on improving Product X. If you regularly see negative comments regarding a particular portion of the consumer experience, maybe the wait time to place an order or lack of knowledge by the customer service team, that tells you that you need to target those particular weak points. Data tells us what’s happening. But it requires us to learn how to read it. And it requires that we have the desire to make the types of changes the data suggests.
Nobody’s perfect. Every business can improve. You have at your command enough information to figure out where you need improvement. You also have enough information to learn what other information you need. What pieces of data will allow your business to make educated decisions? What do you need to know? Why do you need to know it? Those are the questions you should be asking when you’re thinking about data collection. After all, who wants a giant pile of topsoil sitting in their driveway forever?
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