With the increasing importance of data in decision-making and marketing communication strategies, companies must prioritise customer needs and preferences when collecting and using their data. GDPR gave consumers more control over how their data is collected, stored and used, and introduced hefty penalties for those that do not comply. But, the negative impacts of mishandling customer data aren’t just financial, they include:

• Reputational damage

• Loss of customer trust

• Poor return on investment

• Misanalysis sending strategies off track

• Poor customer experience

• Lost opportunities (poor quality leads, low conversion)

How are marketers using customer data?

Since GDPR came into force marketers have had to examine whether they are ethically (and legally) using the right methodology to collect and process customer data.

There are three key elements of this, collection of data, analysis of data and the use of data in marketing.

Data collection

Companies gather customer data from multiple sources - employing a variety of technical and deductive methods, as well as advanced software. Whether demographic, firmographic, quantitative or behavioural, they capture data in various forms to better understand their current and prospective customers, optimise their marketing process and ultimately improve ROI.

To ensure a successful data-driven marketing strategy, businesses need to collect data at different touchpoints in the customer journey. From logging initial website visits and social media activity, to gathering in-depth feedback from existing customers using qualitative surveys - companies need an arsenal of detailed insight gathered directly from their clients as well as external sources.

Data analysis

By leveraging digital platforms like Google Analytics, marketers can track the performance of their campaigns in real-time, giving them a detailed view of how their efforts are faring. This type of customer data analysis allows them to identify trends and optimise their approach.

Additionally, patterns in data can help reveal potential opportunities that might otherwise go unnoticed. Using predictive analytics, for example, marketers can not only better understand current behaviours, they can also calculate future behaviours and anticipate customer needs.

Data-driven marketing

Data and insight captured helps marketers design more personalised and relevant campaigns with messaging that resonates better with the target audience. By delivering customised offers and content tailored specifically to individual audiences, marketers can increase brand loyalty and drive higher conversion rates.

Digital technologies can help marketers segment and target customers with more relevant ads, based on their location, interests or browsing behaviour. Data gleaned through customer interactions with sales or service teams can help build a 360-degree view of the customer to inform a more personalised approach and enhance the customer experience.

A fair exchange

Failing to implement a compliant data management strategy has consequences both for businesses and buyers alike. To maintain buyer trust, marketers must balance their desire for optimised performance with their customer’s need for transparency, choice, and control over how their data is used.

With the rise of poor data practices, good data management provides the opportunity for businesses to stand out from their peers and build strong, trusting relationships with their customers. Poor practice such as lack of consent or poor personalisation due to inaccurate data will undermine those relationships. It is important to find the right balance, where the customer feels secure in sharing their data and receives value in return. Preference centres that allow users to subscribe or unsubscribe for a variety of content options are a good example of where offering choice can help achieve that balance.

By collecting customer data ethically, storing it efficiently and using it in a sensitive way it’s possible to build relationships that will last beyond a “welcome” email.

Best practice for utilising customer data

The potential benefits provided by utilising customer data are clear—but marketers must adhere to data protection regulations. Customer data should always be collected compliantly, anonymity should be ensured wherever possible, and all collected information should be stored securely.

Here a few tips to help you ensure your data is compliant, whilst still serving the needs of your company and the individuals you deal with.

• Collect data ethically and responsibly. Use opt-in, be explicit with what a user is accepting and be accurate in how it’s collected.

• Segment your data. Effective marketing relies on the right message in the right hands at the right time. You can’t do this if your database is “one-size-fits-all”, so segment and tailor your campaigns.

• Use legitimate interest. Ensure you balance your use of data with the rights and interests of each individual.

• Provide choice. Your subscribers might not want to say a final goodbye, they might just want:
  • A break
  • Only to hear about certain aspects of your business
  • Less frequent communication
• Invest in managing your data well.
  • ​Cleanse and maintain data on a regular basis.
  • Define processes that keep you compliant.
  • Ensure your staff are trained in the relevant procedures.

Data is your friend. Use it effectively and you’ll gain customers, improve retention rates and improve your customer’s experience. Use it poorly and you’ll fall foul of regulations and damage your brand.

Read how to carry out a compliant contact strategy