The importance of CRM data management

March 26 2019

Sales and marketing depend upon the data contained within your CRM system. When it's properly taken care of, that data can fuel your company's success. Left unattended, it becomes an impediment to growth. 

How CRM data drives success

For marketers to effectively fill the sales funnel, they need to define their ideal customers, target the right markets and personas, and know how and when to engage them with the right messages.

Once these qualified leads are handed over to sales, the reps need detailed information to understand their prospects, personalize their pitch, solve a specific challenge, and relate to relevant business events. They need to know who to reach out to and, in a perfect world, how and when to reach them.

Data - clean, complete, reliable data - is required for every step of that process. Sellers and marketers need data and insights about their prospects' companies such as who they are, what industry they're in, and their size in terms of revenue and employees. They need to know where they're located and if they are affiliated with other companies and subsidiaries. It's helpful to know financial details, relevant news, and contact information. 

They also need data about the individuals in those companies, including titles and job functions to identify potential buyers or influencers. They need to know how to contact them and, better yet, how they’re connected and what the decision-makers are interested in.

When they don't have that data, or the data in CRM is outdated, they waste time researching across the internet or chasing the wrong leads. They send irrelevant messages, possibly tarnish your brand, and miss the right opportunities all together. 

The cost of bad CRM data adds up quickly.  But for most companies, it's a large "hidden" expense of missed opportunities, rather than a hard dollar cost.  That's why many companies don't fully realize the cost impact of bad data, and don't invest early enough in a solution to keep their data clean and complete on an ongoing basis.

With dirty data, the investment in CRM is minimized and many CRM deployments fail to deliver their expected ROI because the data in them isn't useful.

Inevitable decay

Left unattended, data gets dirty, if for no other reason than because of change.  A recent study found that 64 percent of all workers are comfortable job hopping - defined as spending less than two years in a  job - up 22 percent in the past four years. That fact alone can account for a significant portion of your contact records going bad each year. According to SiriusDecisions, the typical B2B company's CRM database has critical errors in 10 to 25 percent of its contact records at any given time. And some studies suggest much higher percentages. Then consider the changes to companies like relocations, mergers, acquisitions, growth, bankruptcies, and on and on.

Clearly, managing your CRM data and having a plan to ensure that it is clean and complete needs to be a priority. So where do you begin?

The 1-10-100 rule

There's an industry adage about managing CRM data known as the 1-10-100 rule. According to the rule, it costs $1 to address bad data as it's coming into your CRM system (think about webforms submitted by Abe Lincoln, President), $10 to correct it once it's in your database, and $100 if you never do anything.  It makes sense, because the effort to clean data once it's in your system is exponentially more difficult than ensuring its accuracy when it comes in.  Doing nothing impairs your sales and marketing effectiveness daily, wasting limited marketing budget and precious sales time.  Newer technologies, such as sales AI, lead scoring, and others also depend on accurate data. Garbage in, garbage out!

How to proactively manage your CRM data

A good place to start your data management program is at the $1 end of that spectrum by validating and enriching lead data as it enters your CRM. There are a number of lead enrichment solutions on the market that can help.

In effect, they install a "digital doorman," for lack of a better term, to check every field of every record against a known database. Fake data gets flagged, incorrect data is corrected, missing data is quickly added, and you can be confident the new data is accurate as of that moment.

But since data is always deteriorating, you'll also want a solution that enables you to keep your data clean and complete going forward.  Look for automatic data cleansing solutions that enrich and refresh your data within Dynamics 365 on a monthly or quarterly basis. These solutions routinely match your CRM data against an external source of fresh data and update or fill in incomplete records with current information.  Some do it automatically across all records, while others allow you to have control over which records and fields to update based on rules you establish.

Another way to keep your data clean on an ongoing basis is to use a sales intelligence solution that offers a sync-to-CRM feature. Your sellers can compare the data in your CRM against the solution’s data and decide to update or fill in fields on a field-by-field basis or click to update the entire record. This type of solution eliminates manual data entry, which is both a time sink and another potential entry point for dirty data.    

As you consider your own CRM data and how to invest your resources wisely for better revenue growth, start with a foundation of clean, accurate data and sales intelligence in your CRM to fuel your sales and marketing success.  It’s one of the most cost effective ways you can invest in the success of your business.  Without good data, your entire CRM investment is at risk.

You can find sales intelligence and data cleansing solutions for Dynamics 365 for Sales on Microsoft AppSource.

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About Heidi Tucker

Heidi Tucker is vice president of global alliances at InsideView, which provides InsideView Insights, a data enrichment and sales intelligence solution for Microsoft Dynamics 365 that embeds family trees directly into Dynamics account records. Heidi has been leading marketing, sales, and business development for cloud, financial services, and data companies for over 25 years. Heidi previously held executive positions at Hoover’s (a D&B company), LexisNexis, and Bank of America. Visit insideview.com/insights or register for free Insights training to learn more.

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