Data Quality The Foundation for Effective CRM
A growing number of trade press articles and industry analyst research have documented that the return on investment from CRM initiatives and other customer-facing systems has been limited by poor data. In November 2001, Gartner Group published a seminal piece of research on the relationship between data quality and CRM. The principal finding:
"High-quality, well-integrated customer data is the cornerstone of a successful CRM effort. It is also the key to achieving several critical benefits—such as eliminating excess operational costs caused by redundant data, and enhancing revenue through improved customer targeting and retention."
The rapid growth and adoption of CRM is focusing increasing attention on customer data. The number of businesses worldwide implementing such systems, with the associated multimillion-dollar expenditures, continues to grow. With such extensive resource allocations, business executives are under tremendous pressure to realize a return on investment from these expenditures.
To be effective, CRM systems must have at their core accurate, complete and integrated data. The decision-making processes of the enterprise are only as good as the information on which they are based. There is a monumental shift accompanying the growth of CRM—corporate data is being transformed from an IT cost burden to a unique, competitive asset that marketing management is attempting to harness.
The Value of Integrated Data
To obtain return from CRM investments, you must develop and maintain an accurate, single-customer view. Having this vantage provides a cross-enterprise view of the products and services being used by each customer. Gartner Group posits that despite substantial CRM investments, less than 10 percent of enterprises have a single, company-wide view of their customers—a critical stepping stone toward customer loyalty.
The vast majority of businesses have access to variables such as purchase history and lifetime value, offering them timely information about their customer relationships. However, these measures are only useful if they're obtained from reliable and integrated data. For instance, if a business isn't merging customer purchase history from all sales channels such as retail outlets, call centers and Web sites, an enterprise purchase history measure is of little use and can adversely impact future business decisions, such as the development of targeted offers.