Five steps to improve your customer data

by MarketingFile 21. November 2013 13:49

Your company database is one of your greatest assets.

 

It tells you who your customers are, what they are like, how they buy. If your marketing to them is successful, and what your best-selling products are, it holds invaluable information to use in marketing and sales, and of course it is the address book of the company.

 

In these tough economic times maximising sales from your existing customers becomes even more important. In all these cases, to get the most out of your database, it must be in peak condition.

 

The five key steps to whipping your data into shape are:

 

Step one: Referencing

Each customer should have a unique reference number (URN) or code that identifies them. Ideally all transactional information should feed into one unique customer record. A URN allows for accurate response analysis, detailed customer behaviour tracking, and database searching. It will enhance and simplify cleaning routines, match-backs and any data manipulation you opt to proceed with.

 

If your database doesn’t have customer codes for each individual customer and prospect, creating them is the first thing to do. All mailings, both postal and email, should feature this code and you should make every effort to use it - have order-takers ask for it, include it as an optional field on the online order form and capture the code during the order process.

  

Step two: Formatting and standardising

The format of the database is vital to ensuring that your data is in tip-top condition. A well-formatted database will guarantee that mailing addresses look professional and are deliverable. It will also ensure that any cleaning carried out is optimised.

 

The ideal format should have the name split out (title, first name and surname), town, county and postcode columns with the correct information in the correct column. This should create the new standard for the database and be maintained moving forward.

The text within the database should also be case standardised - with names, towns and postcodes having capital letters where applicable.

 

Step three: Cleansing

The cleanliness of your database will have a direct impact on two critical areas of your business; 1) the return on investment of your house mailings - and therefore the bottom line. 2) Your reputation.

 

Clean data will keep you from throwing money down the drain every time you mail your database. It also ensure that households don’t receive mail for someone who moved a year ago, which would lead those households to believe that your company doesn’t know its customers.

 

The key cleaning routines recommended are as follows:

 

Postal Address File (PAF). Matching and updating against this file will standardise and correct any records among your prospect and customer addresses that are incomplete. The process will update where it can and kick out those that are PAF “failures”. Ask to have the PAF failures given back to you. These can sometimes be deliverable; they simply don’t conform to the Royal Mail standard - for instance, somebody might have given his house a name but Royal Mail list it as a number. You can then research these records through a data bureau such as MarketingFile.

 

Change-of-address files. The best-known is Royal Mail’s National Change of Address (NCOA) file, which is updated monthly. These files replace an old address with a new address, flagging the data to highlight where a change has been made. This will prevent you from losing touch with loyal customers.

 

Gone-away files. These files flag or suppress contacts who are no longer living at the address you have for them. It’s very easy to think that your file must be up to date because you are mailing all the time and receiving return copies from gone-aways. In actuality you can still have a surprisingly large number of gone-aways on your file. Note that if you choose not to update your movers, the number of gone-aways will usually rise.

 

Deceased/bereavement files. These files flag and suppress those who have died. It is important to regularly run your data against this type of file, as receiving direct mail addressed to a deceased person can deeply upset those left behind. The matching process can be done at an individual or a household level, with the latter ensuring that no-one in a house where a bereavement has occurred gets mailed.

 

Step four: Enhancing

With a clean and accurate set of customer data you can start to consider ways to enhance and use your data as a cross-selling / up selling and marketing tool. Have a look at your database and data capture mechanisms to see if you ask and gather all the information you need.

 

Do you capture email addresses? Are you asking the right opt-in / opt-out questions to ensure that you can contact your customers with emails or e-newsletters? Could you find out anything else about your customers that might be relevant in helping you understand them more, thereby enabling you to increase sales? Age, presence of children, presence of pets and hobbies and interests could all be useful. However finding out all this information can be time consuming and costly.

 

A simple way to achieve this is to decide on the information you would like to have on your customers and use a data solutions company like MarketingFile to append this data from the millions of records we hold on file to your database.

 

Step five: Segmentation

The best way to truly understand your customers and enhance sales is to analyse the transactional data you have available and to segment your database accordingly. This will enable you to create a marketing plan with a specific action by segment. Your communications with your most-loyal customers, for example, should be completely different to your messages to customers who buy from you only when you offer them discounts and to customers you haven’t heard from for a year.

 

Likewise, you will need a different marketing approach for your prospects than for your customers.

 

Detailed response analysis is also part of this process, this is aided by a clean and well-structured database. If you need help with this sort of activity (and many do), a data solutions company like MarketingFile will be able to segment and analyse your data for you, providing reports as required to aid you in your planning.

 

To summarise

Understanding your customer and your marketing activity is a vital part of developing a marketing plan that drives profitable sales. At the heart of this is an accurate and clean set of data that has all the information you need to communicate with and learn about your customers.

 

Your database is the most important asset of your business, it can work its hardest for you only if it is in good condition.

 

It is the key marketing and sales tool of your company, so treat it well. 

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