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Do You Really Know the Value of Your Data?

Martin_Doyle_DQglobalIn this special guest feature, Martin Doyle of DQGlobal discusses the ways that data quality is tantamount to business success. Martin is CEO of DQGlobal, providers of data deduplication software, address verification and data cleansing software. 

Do you know where your passport is?

Could you break off from reading this article and head directly to the place where it’s stored?

Items we need have a habit of disappearing at the worst possible time. Only then do we truly realize how valuable they are. If you lose your passport a few days before a holiday, you’ll probably toss and turn through a few sleepless nights until you find it!

Understanding Value

Your passport is more precious just before a holiday, when you really need it. Items, or assets, are not consistent in their value: it fluctuates. The value of something is determined by how much we need it, and our needs change over time. If you can’t locate your wallet right now, it’s no big deal – you don’t need it as you read this article. If you couldn’t locate your wallet as you approached the supermarket checkout, its value to you would be far higher.

We tend to value things more when we don’t have them, which is why we crave bigger and better items: faster cars, better computers, a new smartphone. Once we acquire that item, we will probably grow accustomed to having it, and its value will drop.

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In financial terms, an asset naturally depreciates over time as well. A brand new car, parked on the forecourt and gleaming in the sun, will immediately lose 11 per cent of its value when it’s driven away. Its value changes dramatically in an instant.

These two types of devaluation can work together. After a year, a brand new laptop that was highly valued the day you bought it will be worth considerably less. Not only will it have depreciated in monetary terms, but you’ll almost certainly desire a newer model that will be ‘worth’ much more to you.

Data Depreciation

Like physical goods, and information technology, data depreciates in value over time. We often refer to this as data decay, because the data becomes less and less accurate.

One simple example of decay is the change in personal data. It’s easy to demonstrate.

If you’ve filled in a finance application lately, you may have been asked for your address history over the last five years. You may have had one address, or several. Companies know people move around frequently, change their names, get married, get divorced and pass away. Keeping track of everyone’s movements is a big data quality challenge, and no business can escape it.

Valuing Data

Business data is essential to profitability. A company without any customer contact details is going to find it much more difficult to market their goods, or support their existing customers. Accurate information is essential if marketing and support are to be cost-effective.

Surveys prove that customers understand just how valuable their personal data is. And as we’ve proven, data is far more valuable once it no longer exists. Anyone who’s lost data from a hard drive, or misplaced a memory card full of holiday snaps, will know the sickening feeling when they realize the data could be gone forever. It’s the same with data decay: once you lose accuracy in that customer record, all of the time and energy you put into getting that information is wasted.

A corrupt, out of date, duplicated or misspelled customer address is completely worthless. But a cleaned, deduplicated and enhanced customer record is potentially worth thousands of pounds.

The Cost of Inaction

Neglect your data and you’ll start to see negative consequences. No matter what kind of database you’re working with, the results will be:

  • Double handling of leads (and the annoyance that causes for your staff and your customers)
  • Lost sales opportunities
  • Damage to your brand reputation, including social media backlash
  • Ineffective segmentation, leading to ineffective targeting during marketing campaigns
  • A reduced single customer view, leading to inefficient support, or a poor quality of support experience

These outcomes are not simply unfortunate – they can, and do, cost money. Repeated work, inefficient campaigns and customers that flee to your competitors: these all add up to a hit on your bottom line.

In the end, it’s simple: the efficiency and effectiveness matrix proves that there’s a formula for success:

  • Do the wrong things right: die quickly
  • So the wrong things wrong: die slowly
  • Do the right things wrong: survive
  • Do the right things right: thrive

If your data quality isn’t being maintained, you’re already losing money, and you’ll losing a lot more in the months to come. If you’re not doing the right things right, your business may fail to thrive – or struggle to survive.

 

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