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THE USE AND MANAGEMENT OF CUSTOMER DATA

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Key

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Contents

The use and management of customer data

Introduction 03Key findings 04

Section 1 - Marketing and data strategy 1.1-Biggestmarketingchallenge 051.2-Averageannualchurnrate 061.3-Improvingmarketingperformancewithcustomerdata 071.4-Top3marketingperformancemetrics 081.5-Functionsresponsiblefordata 09

Section 2 - Improving marketing with data 2.1-Improvingmarketingwithdata 102.2-Customerdatamanagementchallenges 112.3-ConfidenceinGDPRdatacompliance 122.4-Implementingstrategiestorepermissioncustomerdata 142.5-Channelsusedtorepermissiondata 15

Section 3 - Collecting and managing customer data 3.1-Sourcesofcustomercontactdata 163.2-Channelsusedtocollectcustomercontactdata 173.3-Typesofthird-partydatausedforenrichment 18

Section 4 - Dealing with data quality 4.1-Validationofcustomercontactdata 194.2-Contributorstopoor-qualitycustomercontactdata 204.3-Frequencyofdatacleansing 214.4-Costofpoor-qualitycustomercontactdataasapercentageofannualrevenue 22

Methodology and sample size 23About us 24

supportacquisitionandretentionactivitiesandunderpineverystageofthecustomerjourney.Whendiggingdeeperintothemostcommon

causesofpoorqualitydata,inaccurate,incompleteandout-of-datedataare,onceagain,topofthelist.Itstillsurprisesmetoseethatalargeproportionofbusinessestodayhavenoformalprocessesorsolutionsinplacetoeithercleanseorenhancecustomerdataonacontinuousbasis.Butexperienceshowsusthatregularcleansingand

enhancementofinternally-heldcustomerdatawithproperly-permissioned,compliant,good-qualityandtrustedthird-partydataisproventoimprovemarketingperformanceandcustomerexperience.Inabusinessenvironmentcharacterisedbyfierce

competition,fragmentedchannelsanddiversecustomerexpectations,acceptingpoorqualitydataisnolongeranissuebusinessleaderscanaffordtoignore.Wehopeyoufindthisresearchreportusefulasyou

prepareforGDPRcomplianceandplacedataqualityattheheartofyourcustomerrelationships.


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IntroductionSincewepublishedourlastresearchreportintotheuseandmanagementofcustomerdata,it’sbecomeverycleartousthattheimpendingenforcementoftheGeneralDataProtectionRegulation(GDPR)on25thMay2018isplacingorganisationsunderincreasingpressuretocomplywiththenewregulations.ButhereatRoyalMail,weviewtheGDPRasan

opportunity.Whatweknowisthattheproblemsofpoorqualitycustomerdatahaveblightedbusinessformanyyears.Inthisregard,theGDPRactsasacatalysttousherinaneweraofdatagovernance,particularlywhenitcomestotheuseofcustomerdataformarketingpurposes.We’reseeingmoreandmorecompaniesapproaching

usinsearchofnewandinnovativewaystohelpthemimprovetheoverallqualityoftheircustomerdata.Thisisnotjustasanexerciseinregulatorycompliance,it’sbecausethey’replacingcustomerexperienceattheheartoftheirdata-drivenmarketingstrategiesandcampaigns.Andwhatastutecompaniesunderstandisthatdataqualityisofparamountimportanceto

Jim Conning,managingdirector,RoyalMailDataServices

•Theshiftawayfromthird-partydataandincreasedreliancejustonself-sourcedcustomercontactdataappearstohavechecked-halfofallmarketers(50percent)nowsaytheyenrichtheirowndatawiththird-partyvariables.Bycontrast,fourinten(41.7percent)onlyusedirectlygathereddata.

•Wherecustomercontactdataisenteringinternalsystems,suchasCRM,16.3percentofmarketersarestillnotvalidatingthedatacaptured.Althoughthisisdownfivepointsyear-on-year,itisstillriskinganunnecessarydataqualityissuewhichfourinten(40percent)haveeliminatedbyusingautomatedchecks.

•Basicdataerrorscontinuetocontributetopoor-qualitycustomerdata,without-of-dateinformationhavingthehighestnumberofmarketersidentifyingitastheirnumberoneproblem,althoughincompletedatascoreshigherwhensecondandthirdranksareincluded

•Nineoutof20marketers(45.6percent)havethebenefitofcleandatathathasbeencheckeddailyormonthly.GiventheemphasisplacedbytheGDPRonkeepingdataup-to-dateandaccurate,theseorganisationsaremorelikelytohavecompliantdatatoworkwiththanthosewhohavenoformaldataqualityprocess(32.7percent).

•Amongallofthosemarketersabletomakeanestimateoftheimpactofpoor-qualitycustomerdata(excludingdon'tknows),in2017,respondentsestimatedtheaveragecostofpoor-qualitycustomerdataat5.6percentofannualrevenue,justslightlylowerthanthe5.9percentfigurerevealedin2016.


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•Fouroutoftenmarketers(42.3percent)sayfindingnewcustomersistheirbiggestchallenge,butoneinfour(24.2percent)saytheystrugglewithanalysingcustomerdata.

•Althoughaveragecustomerchurnrateshavesoftenedby2percentinthelastthreeyears,nearlyoneinfivecustomers(18.7percent)willdefectyear-on-year.Forbrands,therateisaboveaverageat21.4percent.

•Marketershaveidentifiedanalysingdataasthenumberonefactorthatcouldimprovetheircampaignperformance(24.2percent),withdataqualityaproblemfor22.9percent.Butchangingtheorganisationalculturetoreflecttheimportanceofgood-qualitycustomerdataisthesecond-biggestpainpointforbrands(20.6percent).

•Qualityofcontactdataisseenashavingthebiggestimpactonmarketingresponseandconversionrates(rated4.6outof5),alongwithsegmentationandtargeting(alsorated4.6outof5).Bothofthesearetiedincloselywithdatamanagementandanalytics,yettheseareareasinwhichanincreasingnumberoforganisationsarestruggling.

•Butwhile20.3percentofmarketershavechallengesaroundcustomerdatamanagement,allotherconcernsareovershadowedbycompliancewiththeGDPR.Nearlythreeinten(29.4percent)expressedworriesaboutthis,astartling242percentincreaseyear-on-year.

•Acrossallmarketers,74percentareusingemailtorepermissiondatawhichmaycarryrisks,givenrecentICOfines.Bycontrast,usingthecompany’sownwebsite,asplannedby76.2percentofallmarketers,islowrisk.

Key findings

fallenfourfoldsince2014andisnowonlypractisedbyonein17organisations(6.1percent).Thismaywellbelinkedtotheproblemsbeingexperiencedwithpoor-qualitycustomerdataandconcernsaboutthecomplianceofthird-partydata.Butalso,ifthecustomerlifecycleformost

companiesnolongerincludesreactivation,thisoverlooksthepotentialwarmthwhichapre-existingrelationshipcanbring.Instead,marketingcouldbetreatingtheseone-timecustomersasprospects,whichislikelytoreducethelikelihoodofthemrespondingandbuyingagain.


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Prospectingfornewcustomersisperenniallythebiggestchallengeforanyorganisation’smarketingwithfourintenratingithighestin2017.However,theoptionsavailablehaveanimportantimpact.Thisyear,analysingcustomerdatawasincludedasaresponsechoiceandwasimmediatelypickedbyonequarter(24.2percent)indicatingthatoneinfourmarketingdepartmentsarestrugglingwithdataandanalyticsissues.Thesecondnotabletrendisahugedeclineinthe

numberofrespondentswhosebiggestmarketingchallengeisreactivatingdormantcustomers-thishas

Section 1Marketing and data strategy1.1 - Biggest marketing challenge

0 10% 20% 30% 40% 50% 60% 70% 80%

Reactivating dormant customers

Converting registered customers to active purchasers

Keeping existing customers

Analysing customer data

Finding and acquiring new customers 42.3%

52.2% 45.0%

61.9%

24.2%

16.4% 11.0% 12.1%

33.3%

11.0% 7.7%

9.9% 18.6%

6.1% 11.4%

16.5% 24.2%

n2017n2016n2015n2014


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1.2 - Average annual churn rate

agenciesrevealsasignificantlyabove-averagechurnrateforbrandsand,potentially,alackofvisibilityforagenciesoftheissuefacedbytheirclients.Withsofeworganisationspursuingawinback

processfordormantcustomers,itseemslikelythatoncedefectorshavegone,marketingistreatingthemasgoneforgood.

Theproblemofthe“leakybucket”ofcustomerchurnisthemaindriverofmarketing’sneedtogoprospecting.Withanaverageofnearlyoneinfivecustomersdefectingyear-on-year,thissetsahighbarforachievingapositiveimpact.Despiteanapparent2percentdropintheaverage

overthelasttwoyears,disaggregatingbrandsfrom

nAverage(excludingdon'tknows)

0%

5%

10%

15%

20%

25%

Average (excluding don’t knows)

18.6%

2014 2015 2016 2017 2017- Brands Only

20.7% 19.8%18.7%

21.4%


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1.3 - Improving marketing performance with customer data

guardiansofcustomerdata,whereasagenciesonlyprocessitontheirbehalf.However,asthisisanissuefor20.6percentofbrands,itonlyservestoreinforcetheviewthatmanystruggletoembedadataandanalysisculture.Bycontrast,10percentmoreagenciesthan

brandsseebetter-qualitycustomerdataastheirroutetoimprovedmarketingperformance.Thissuggeststheremaybeaflawintheprovisionofthisdatabybrandstotheveryagenciesthataresupposedtobehelpingthemwithretentionandconversion.

Consistentwiththenumberofmarketerssayinganalysingcustomerdataistheirbiggestchallenge,exactlythesamenumber(24.2percent)saidbetterwaysofanalysingandmodellingdatawouldimprovetheperformanceoftheirmarketing.One-thirdmorebrandsstrugglewiththisthanagencies,perhapsreflectingadeeperandmoreestablishedmarketinganalyticsresourceontheservicesideandaresourceconstraintforbrands.Brandsaremorelikelythanagenciestowantabetter

understandingofgood-qualitycustomerdataintheirorganisation.Thisistobeexpectedasbrandsarethe

0% 10% 20% 30% 40%

Agencies

Brands

All

Other

Faster access to data

Trusted sources of compliant third-party data

Larger volume of permissioned customer data

Better understanding in organisation of importance of

good quality customer data

Better quality customer data

Better ways of analysing and modelling data

24.2%

nAllnBrandsnAgencies

27.8% 20.0%

22.9% 18.3%

28.6%

18.2% 20.6%

15.2%

14.3% 13.5%

15.2%

11.7% 10.3%

13.3%

5.6% 6.4%

4.8%

3.0% 3.2%

2.9%


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ofmentionsinfirstplaceandcost-per-acquisitionplacedsixth.Bothoftheserequirecalculationbymarketersandtheuseofthird-partydata.Surprisingly,socialsharesandmentionsarenotwidelyusedtomeasuremarketingperformance,suggestingtheseareconsideredtobesecondaryeffects.Permissionandunsubscriberatesforemailare

onlyusedbyasmallnumberofmarketers,despitethefactthatthesehaveanimportantimpactontheabilitytoreachindividuals.ThesemetricsmayriseinimportancewithenforcementoftheGDPR.

Veryfewmarketerssaytheyeitherdon’torcan’tmeasuremarketingperformance.Formost,metricsreflectactionstakenbyprospectsandcustomerswhichshowupclearly.Directsalesisthemostcommonmeasurewithtwiceasmanymarketersrankingitinfirstplaceabovethosewhoprimarilyuseattributablerevenueorleadsgenerated.Ifsecondandthirdranksaretakenintoaccount,websitetrafficandclick-throughratesjointhesemetricsinthetoptierofdirectmeasuresofmarketingperformance.Derivedmeasuresarealsoimportant,with

marketsharegainingthefourth-highestnumber

1.4 - Top 3 marketing performance metrics

0 20 40 60 80 100 120 140 160 180

Other (please specify)

We can't measure marketing performance

We don't measure marketing performance

Don't know

Unsubscribe rate for email

Retail footfall

Permission rate for contacts

Social shares/mentions

Cost per click

Market share

Cost per acquisition

Click-through rates

Website tra�c

Leads generated

Attributable revenue

Direct sales

nRanked1nRanked2nRanked3

101

49

37 21

34 29

43 41 25

28 35 42

19 37 43

20 38 29

36 21 18

3 12 15

5 12 10

4 6 15

4 10 10

1 9 12

6 7

7 7 2

5 3 4

4


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1.5 - Functions responsible for data

Notsurprisingly,legalandcompliancearealsoinvolvedinprivacy/permissions,notleastbecauseoftheimportanceofclearlyexpressingthepurposeforwhichdataisneededinprivacypolicies.Marketingcanthenusethebrand’stoneofvoiceandtesttechniquestooptimisethepermissionrateachieved.Whatisstrikingisthenumberoffunctionsthathave

aroleindatamanagementanddataquality.Thisclearlyreflectshowdata-saturated(andthereforedata-rich)organisationshavebecome,butalsothecomplexityofchanginganyprocessrelatingtocustomerdata.

Marketingtakesleadresponsibilityforthekeyaspectsofusingandmanagingcustomerdatainmostorganisationswith50.6percentsettingthedatastrategy,37.2percentresponsiblefordatamanagement,and43.7percentleadingprivacy/permissions.Butmarketinghasessentialsupportfromspecificfunctionstocarryoutthesetasks.Boardsare,notsurprisingly,closelyinvolvedwithdatastrategyinonequarteroforganisations(25.5percent),asiscentraldatamanagement(26.0percent)andCRM(21.6percent).

0%

20%

40%

60%

Don’t knowNobodyCustomer serviceProduct divisionsEcommerceLegal and complianceSalesIT/ISStrategyCRMBoardCentral data managementMarketing

Marketin

gCentra

l data

managem

ent

Board

CRM

Strate

gy

IT/IS

Sales

Legal and co

mplia

nceEco

mm

ercePro

duct divisi

onsCusto

mer s

ervice

NobodyDon’t k

now

nSettingthedatastrategynDatamanagement(includingdataquality)nPrivacy/permissions

50.6%

37.2%

43.7%

26.0%

36.8%

24.2%25.5%

9.5%

12.6%

21.6%

27.7%

23.4%

16.9%

3.5%3.0%

12.1%

29.9%

19.9%

10.8%

16.9%

8.7%10.0%

8.7%

38.5%

6.5%

10.4%

6.9%6.5%

10.4%

4.8%3.9%

19.5%

10.0%

3.0%1.7%

0.4%

3.0%1.3%

2.2%

Allfourdata-orientedfactorswhichmightimpactonmarketingcampaignresponseandconversionrateshaverisensignificantlyinimportancesincelastyear,demonstratingclearlyjusthowimportantdatanowistocampaignsuccess.Good-qualitycontactdataisseenashavingthebiggestimpact(4.6ona5-pointscale),equalwithsegmentationandtargeting(4.6).Bothofthesearetiedincloselywithdatamanagementandanalytics,yetthesearealsoareasinwhichanincreasing

numberoforganisationssaytheyarestruggling.Themechanicsofmarketingfallintothesecond

tieroffactors,withpersonalisedcontent(4.4)andtiming(4.3)nearlytiedinimportance.Marketersareabletoadjusteachoftheseaccordingtostrategyandobjectives,butneedtherightqualityofdataandanalyticstodoso.Creativedesign(4.0)andcontextualdata(3.8)thencomeintoplay,butareinfluencers,notleadersofmarketingperformance.


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Section 2 Improving marketing with data2.1 - Factors impacting marketing campaign response and conversion rates (5-point scale)

0 1 2 3 4 5

Use of contextual/life event data

Creative design

Timing

Personalised content

Segmentationand targeting

Quality of contact data

4.6

n2017n2016n2015n2014

3.5 3.7

3.4

4.6 3.5

3.6 3.6

4.4 3.3

3.5 3.2

4.3 3.5 3.5

3.4

4.0 3.4

3.2 2.9

3.8 2.9

3.0 2.9


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worriesthemmorethancompliance(37.3percentv24.6percent),whileforagencies,thesituationisreversed(16.2percentv35.2percent).Thisreflectsthefactthatbrandshavetodealwithcustomerdatamanagementsystems,whileagenciesaremoreoftenhandlingthird-partydata.Inlightofthesetwomajorissues,itisnotsurprising

thatonly4.8percentofmarketersnowsaytheyfacenochallenges,downbyhalfonthe9.8percentwithnochallengesin2016.

Overshadowingallotherconcernsaboutthemanagementofcustomerdata,GDPRcomplianceisnowthenumberoneissueformarketersasawhole.Withastartling242percentincreaseyear-on-yearinthenumberwhocitethisasachallenge,nearlythreeinten(29.4percent)expressedworriesin2017,upfromjustoveroneinten(11.9percent)in2016.GDPRfearshaveevenoutstrippedlegacysystems(27.7percent)whichusedtobethedominantchallenge.Forbrands,itisworthnotingthatlegacytechnology

2.2 - Customer data management challenges

0 10% 20% 30% 40%

Other

Don’t know

No challenges

Sourcing responsive data

Poor data quality

Legacy systems

Non-compliance with GDPR

Non-compliance with GDPR

%21%21

%21%21

n2017-Alln2017-Brandsn2017-Agenciesn2016

29.4% 24.6%

35.2%

27.7% 37.3%

16.2% 37.6%

17.8% 16.7%

19.1% 20.3%

10.8% 9.5%

12.4% 11.9%

4.8% 2.4%

7.6% 9.4%

2.6% 0.8%

4.8% 4.0%

6.9% 8.7%

4.8% 4.9%

11.9%


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ThechallengesofGDPRcomplianceandthedifferentconcernsofbrandsandagenciesaremostvisibleintheconfidenceeachexpressesaboutcustomerdata.Whileitisencouragingthat78percentofmarketersoverallareveryorreasonablyconfidentthattheir

2.3 - Confidence in GDPR data compliance

0% 10% 20% 30% 40% 50% 60%

Don’t know

Don’t use third-party data

Don’t hold customer data

Not at all con�dent

Not very con�dent

Neutral

Reasonably con�dent

Very con�dent

3.8% 0.8%

2.2%

2.9% 0.8%

1.7%

1.0% 3.2%

2.2%

3.8% 9.5%

6.9%

6.7% 10.3%

8.7%

29.5% 50.0%

39.0%

52.4% 27.8%

39.0%

Internally-held Customer Data

0% 10% 20% 30% 40% 50% 60%

Don’t know




Not very con�dent

Neutral


Very con�dent


customerdatawillbecompliant,thesplitrevealsamorenuancedpicture.Amongbrands,thehighestconfidencelevelisexpressedbyonly27.8percent-halfthelevelfoundamongagencies(52.4percent).


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2.3 - Confidence in GDPR data compliance

Third-party Data

0% 10% 20% 30% 40% 50% 60%

Don’t know




Not very con�dent

Neutral


Very con�dent 12.4%

9.2% 16.2%

30.7% 33.3%

27.6%

16.0% 16.7%

15.2%

13.8% 11.7%

16.2%

7.1% 7.5%

6.7 %

0% 10% 20% 30% 40% 50% 60%

Don’t know




Not very con�dent

Neutral


Very con�dent

5.8% 4.2%

7.6%


Whenlookingatthird-partydata,confidencelevelsaremuchlowerwith43.1percentofmarketersoverallveryorreasonablyconfidentitwillbecompliant.Agenciesarenearlytwiceaspositiveaboutthisasbrands,with16.2percentveryconfidentthatthird-partydata

willmeetGDPRdemandscomparedto9.2percentofbrands.Provingtheyareright,especiallyonceenforcementbegins,mayprovetobeadifferent-andmoredifficult-matter.


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campaignswillbelaunchedinthenextthreetosixmonths-onequarterofmarketers(24.2percent)saythiswillhappen,whereaslastyearonly7.9percentwereatthisstage.ThisreflectstheincreasingurgencyasthedeadlineforGDPRenforcementapproaches.Bycontrast,therehasbeenatenpointdropinthe

numberofmarketerswithnoplanstorepermissiontheirdata,downto17.8percentin2017from27.7percentin2016.Asmarketersexaminethedatatheycontrolanduse,itisclearagrowingnumberhavediscoveredtheyneedtocapturemorecompliantconsentfromcustomers.

OneofthemajorbarrierstoensuringdataisGDPRcompliantisthenatureofthepermissionwhichwasoriginallygained.Marketerscanonlyusecustomerandthird-partydataifthepurposeforwhichitwasneededwasclearlyoutlinedandaccepted-anythingoutsideofthatpurposewillnotbecompliant.Manyorganisationsdidnotexplain-orhavenotrecordedtheirexplanation-andsoneedtorevisitthispermission.Repermissioningstrategiesalreadyinthefieldhave

increased,with20.6percentofmarketersoverallalreadyimplementingthem,upfrom17.8percentlastyear,ledbyagencies(22.9percent).Manymore

2.4 - Implementing strategies to repermission customer data

0% 10% 20% 30%

Don’t know

No plans to implement

Plan to implement in next 12+ months

Plan to implement in next 6-12 months

Plan to implement in next 3-6 months

Already implementing

n2017-Alln2017-Brandsn2017-Agenciesn2016

20.6% 18.3%

22.9% 17.8%

24.2% 27.0%

21.0% 7.9%

18.6% 20.6%

16.2% 17.3%

1.7% 2.4%

1.0% 8.9%

17.8% 17.5%

18.1% 27.7%

17.3% 14.3%

21.0% 20.3%


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risksincecustomersactivelyvisitandcanthenbesolicitedtoreaffirmtheirconsent.Itisnotablethatbrandshaveamuchgreaterlikelihoodthanagenciestousetelephone(44.4percentv22.9percent)ordirectmail(37.3percentv23.8percent).Thephonecanincludeinboundcallsfromcustomerswherethereisnopriorconsentrequired,whiledirectmailoperatesonanopt-outbasis(andwillcontinuetodosoundertheGDPR).De-riskingrepermissioningstrategiesthroughtherightchoiceofchannelisthereforeacriticaldecision.

WhilecapturingfreshpermissionfromcustomersmaybeanecessarypartofaGDPR-complianceprogramme,itbringswithitariskthatthestrategyusedmayitselfnotbecompliant.Acrossallmarketers,74percentareusingemailtorepermissiondata.RecentfinesleviedbytheInformationCommissioner’sOfficehaveunderlinedthat,ifanorganisationdoesnotalreadyholdaconsentwhichincludesmakingcontactagaintorefreshthatconsent,thenemailmaynotbeused.Bycontrast,usingthecompany’sownwebsite,

asplannedby76.2percentofallmarketers,islow

2.5 - Channels used to repermission data

0% 30% 60% 90%

Other

Don’t know

Apps/Push noti�cation

SMS/Text

Resellers/Partners

In-store

Social media

Direct mail

Telephone

Email

Own web site

4.8%


3.2% 3.9%

10.5% 4.0%

6.9%

7.6% 11.9%

10.0%

8.6% 14.3%

11.7%

17.1% 9.5%

13.0%

8.6% 16.7%

13.0%

16.2% 14.3% 15.2%

23.8% 37.3%

31.2%

22.9% 44.4%

34.6%

72.4% 75.4%

74.0%

69.5% 81.8%

76.2%

Theshiftawayfromthird-partydataandincreasedrelianceondirectly-sourcedcustomercontactdataappearstohavechecked.Fiftypercentofallorganisationsnowsaytheyenrichtheirowndatawiththird-partyvariables.Bycontrast,fourinten(41.7percent)onlyusedatatheyhavedirectlygatheredthemselves,downsignificantlyyear-on-yearandnearlybackto2014levels.Inthelightofrepermissioningstrategiesbeingused

-andtheroleplayedbyemailespecially-itmaybethatmarketersaremakinguseofexternalsourcestoregainconsentnow,aheadofanylossofavailableexternaldatapost-GDPR.Giventheeffortsmadebythemorereputableandtrusteddataproviderstoensuretheyhavethird-partydatasharingconsent-andbearinginmindtheincreasedlevelofactivityabouttobeseen-thoseorganisationsthathavealreadyenrichedtheircustomerdatainthiswaylooktobeaheadofthefield.


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Section 3 Collecting and managing customer data3.1 - Sources of customer contact data

0% 10% 20% 30% 40% 50% 60%

Don’t know

Outsource data management

Enrich own data with third-parties

Only use data gathered directly ourselves

n2017n2016n2015n2014

41.7% 49.0%

45.3%

39.4%

50.0%

47.0%

49.6% 55.9%

4.6%

2.7%

2.2%

2.0%

3.7%

2.1%

2.9%

2.0%


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brands(59.0percent)canusetheircontactcentre-makingitthesecondmostimportantdatasource-lessthanhalfthislevelofagencies(27.1percent)accesscustomercontactdatainthisway.Agenciesaremorelikelytousesocialmediathanbrands(43.8percentv35.3percent)andtwiceaslikelytocapturedataviapartners(29.2percentv14.8percent).

Giventherelianceondirectly-capturedcustomercontactdata,ownedchannelsareclearlycriticalwiththewebsiteinprimepositionfornineoutoftenmarketers(91.7percent)anddirectsalesinsecondplaceforthemajority(56.0percent).Thereareimportantdifferencesbetweenbrands

andagenciesinthechannelsused.Whilesixoutoften

3.2 - Channels used to collect customer contact data

0% 25% 50% 75% 100%

Other

Don’t know

Resellers/Partners

In-store

Mobile apps

Direct mail/Mail order catalogue

Social media

Face-to-face

Contact centre

Direct sales

Own web site 91.7%

96.7% 85.4%

56.0% 57.4%

54.2%

45.0% 59.0%

27.1%

39.5% 41.0%

37.5%

39.0% 35.30%

43.8%

30.3% 33.6%

26.0%

28.4% 34.4%

20.8%

22.0% 27.1%

14.8%

15.6%

29.2%

21.1%

1.8%

4.2%

4.1% 2.5%

6.3%



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wherethisaspectofcontactdataisnotdirectlyavailable.Forbrands,demographicdataisthemost-used

overlay(35.3percent),althoughnearlyasmany(32percent)saytheydonotuseanyexternalenrichment.Butforagencies,nearlyeverytypeofextradataenhancementismoreheavilyusedthanitisforbrandsatarateofnearlytwo-to-one.

Thedifferencesbetweenbrandsandagenciesintheiruseofthird-partydataaremostvisibleinthevariableswhicheachusestoenrichcustomercontactdata.Whileemailaddressisthemostcommonoverall(43.1percent),morethantwiceasmanyagenciesusethisvariablecomparedtobrands(62.5percentv27.9percent).Itseemslikelythatagenciesarebeingtaskedwithprospectingandrepermissioningcampaigns

3.3 - Types of third-party data used for enrichment

0% 10% 20% 30% 40% 50% 60% 70%

Other

Don’t know

None

Social media

Mobile phone data

Landline phone data

Geo-location data

Enhanced address data

Demographic data

Email address

2.1%


5.7% 4.1%

5.2% 6.6%

6.0%

18.8% 32.0%

26.2%

17.7% 11.5%

14.2%

25.0% 12.3%

17.9%

28.1% 13.1%

19.7%

33.3% 18.9%

25.2%

40.6% 22.1%

30.3%

39.6% 35.3%

37.2%

62.5% 27.9%

43.1%

Withthewebsiteatthefrontlineofcustomercontactdatacollection,itissurprisingthatoneinfivemarketers(19.1percent)donotvalidatetheaddresseswhichtheyarecapturing-alevelvirtuallyunchangedoverthelastfouryears.Whathasshiftedisboththeimportanceofthischannel-lessthanoneinten(9.3percent)arenotcapturingcustomerdataonline,downbyhalffromoneinfive(20.2percent)lastyear-andtheeliminationofmanualchecking-alsodownbyhalftooneinten(9.8

percent)fromoneinfive(20.2percent)year-on-year.Wherethisdataisenteringinternalsystems,such

asCRM,therehasbeennosuchdropoffintheuseofmanualchecks,but16.3percentarestillsayingtheydonotvalidatethecustomerdatacaptured.Althoughthisisdownfivepointsyear-on-yearandbackto2014levels,itisstillriskinganunnecessarydataqualityissuewhichfourinten(40percent)haveeliminatedbyusingautomatedvalidationatthepointofdatacapture.


19

19

Section 4Dealing with data quality4.1 - Validation of customer contact data

nAutomaticallycheckaddressdatanManuallycheckaddressdatanDon’tvalidatenDon’tcapturecustomerdatanDon’tknow

0% 20% 40% 60% 80% 100% 120%

2014

2015

2016

2017

45.6% 9.8% 19.1% 9.3% 11.2%

44.0% 20.2% 19.2% 20.2% 6.2%

46.1% 14.8% 21.9% 14.8% 7.0%

34.8% 20.3% 21.4% 10.2%

Via Website

0% 20% 40% 60% 80% 100% 120%

2014

2015

2016

2017 40.0% 25.1% 16.3% 4.2% 13.0%

36.8% 18.1% 25.4% 21.8% 10.4%

45.3% 29.7% 22.7% 10.2%

30.5% 18.2% 15.0%

Via Internal Systems

nAutomaticallycheckaddressdatanRunbatchvalidationnManuallycheckaddressdatanDon’tvalidatenDon’tcapturecustomerdatanDon’tknow

0 20 40 60 80 100 120 140 160 180

Don't know

None

Data is in an incorrect �eld

Spelling mistakes

Duplicate data

Missing data

Out-of-date information

Incomplete data

8 17 16

8 13 13

1 3 6

3 4


20

20

secondplacewhenlookingatallthreerankings.Althoughduplicatedatascoresinfourthplace

overall,technicalproblemsareingeneralrankedmuchlower,withspellingmistakesanddatainincorrectfieldsidentifiedwellbelowotherdataqualityissues.

Whenrankingthetopthreecontributorstopoor-qualitycustomercontactdata,basicerrorscompetefortopplace,without-of-dateinformationrankedfirstbymostrespondents,butincompletedatascoringhigherwhensecondandthirdranksareincluded.Missingdatacomesin

4.2 - Contributors to poor-quality customer contact data

43 71 44

66 44 44

53 26 46

32 47 37

nRanked1nRanked2nRanked3


21

21

withaneardoublinginthosecleansingdataeverymonth-upto13.6percentfrom7.8percent.Thismeansnineoutof20marketershavethebenefitofcleandatathathasbeenrecentlychecked.GiventheemphasisplacedbytheGDPRonkeepingdataup-to-dateandaccurate,theseorganisationsaremorelikelytohavecompliantdatatoworkwiththanthosewhoareleavingittochance.

Howeverimportantmarketersclaimdataqualitytobe,onethird(32.7percent)stillhavenoformalprocessforcleaningcustomercontactdata.Eventhoughthisisdownnearlyfivepointssincelastyear,thisstillleavesasizeablegroupexposedtodataqualityissuesfromthepointofcollectionrightthroughtothepointofusage.Bycontrast,overoneinfive(22percent)nowclean

datacontinuouslyordaily,upslightlyyear-on-year,

4.3 - Frequency of data cleansing

0%

10%

20%

30%

40%

Don’t knowNo formal processAnnuallyQuarterlyMonthlyDaily/Continuously

n2017n2016

22.0%

18.7%

13.6%

7.8%

13.1%

9.8%10.8%

14.0%

32.7%

37.3%

7.9%

12.4%

Daily/

Continuously

Monthly

Quarterly

Annually

No form

al pro

cess

Don’t know


22

22

centfigurerevealedin2016.Whileawiderangeoffactorscontributetothis

issue,itisclearthatimprovingdataqualitywouldalsoimprovemarketingperformance,particularlyasthequalityofcontactdataiscitedashavingthemostpositiveimpactonmarketingcampaignresponseandconversionrates.Inturn,marketersshouldwitnessvisiblereturnsoninvestmentfromcampaignsandhealthiercontributionstotheorganisation’sbottomline.

Theimpactofpoor-qualitycustomercontactdata(aswellasnothavingtheappropriatepermissions)addsupacrosstheorganisationeachtimeacustomer-facingfunctionwantstocontactcustomers.Thiscanbehardtocalculate-onethirdadmittheydonotknowthefullcost-butonlyatenthofthatnumber(3.3percent)believethereisnocostatall.Respondentsestimatedtheaveragecostof

poor-qualitycustomerdataat5.6percentofannualrevenuein2017,justslightlylowerthanthe5.9per

4.4 - Cost of poor-quality customer contact data as a percentage of annual revenue

0%

10%

20%

30%

40%

Don’t know0%<5 %6-10 %11-15 %16+ %

n2017n2016

2.6%

5.1%4.2%3.7%

23.3%

20.1%

30.6%

34.6%

5.7%

3.3%

33.7%33.2%

Responsestothissurveywerecollectedviaanonlineself-completionquestionnaireservedtoregisteredmembersoftheDataIQcommunityandcustomersofRoyalMailDataServicesduringMaytoJuly2017.Atotalof281completeresponsesfrombothbrandsandagencieswereincludedforanalysisinthisreport.Consumer-facingbrandsmadeup52.3percentof

thesample,withmarketing/mediaagenciesandother

serviceprovidersmakinguptheremaining46.7percent.Findingshavebeensplitbythesetwogroupstoshowdifferencesintheiruseandmanagementofcustomercontactdata.Findingshavealsobeenincludedfromprevious

years’research.In2016,therewere272respondents,in2015therewere185andin2014therewere226responses.


23

23

Methodology and sample size


24

24

About Royal Mail Data ServicesRoyalMailDataServicesisthespecialistdatabusinessofRoyalMailGroup.We’recommittedtohelpingourcustomersbuilddata-drivenbusinessestoimprovebusinessperformancesowe’reconstantlydevelopingnewcontactandaddressdatasetsaswellasnewwaysforbusinessestosource,captureandusedata.Everydaywe’reprovidingbusinessesofallsizeswithacombinationofcontactandaddressdata,datainsightsandanalysis,anddataqualitymanagementservices.Ourcustomersworkwithusforsomanydifferentreasons.Toimprovetheperformanceoftheirmarketingandcustomercommunicationscampaigns.Totapintothesalesandcustomerretentionopportunitiespresentedbyusingouruniquehomeandbusinessmoverdata.Toreducetheircostsofusinginaccurateorout-of-dateaddressdata.Toenhancetheircustomers’experiencesbydeliveringmorepersonalised,relevantcommunicationsandinteractions.Toimprovetheoverallqualityoftheircustomerdata.Andthesearejustafewexamples.

You’ll find more information at www.royalmail.com/corporate/ marketing/data-services You can also call us direct on 08456 000 098 or, just send an email to [email protected]

About DataIQDataIQaimstoinspireandhelpprofessionalsusingdataandanalyticsintelligentlytodrivebusinessperformanceacrosstheirorganisationandineveryindustrysector.Specifically,DataIQhelpsbusinessprofessionals

tounderstandthebenefitsofadoptingdata-drivenstrategies,developcompellingbusinesscases,implementbestpractice,ensuretheycomplywithdataregulation,andunderstandhowtousethelatesttoolsandtechnologytodeliversustainedbusinessimprovement.DataIQachievesthisbyprovidingessentialinsight,

helpandknow-howfromproprietaryresearch,analysis,bestpracticeandcommentfromindustryleadersanddataexperts.Allmadeeasilyavailablethroughhigh-qualityeventsanddigitalchannels.Ouruniquecommunityofbusinessdecision-makers

andinfluencers–workingacrossfunctionsinFTSE100,largeandmidmarketorganisations–isgrowingrapidlyasaconsequenceofthisuniquefocus.Importantly,DataIQprovidesthebridgefor

ambitiousvendors,agenciesandserviceproviderstoinfluencethishard-to-reachanduniquecommunity.DataIQiscommittedtochampioningthevalue

ofdata-drivenbusinessandbestpracticethroughfocusingonthesuccessstoriesofdata-drivenprofessionalswithinitiativesincludingtheDataIQ100andDataIQTalentAwards,plusmanyothereventsandprogrammes.Wecontributeactivelytotradeandgovernment

bodies,includingtheDMA,IDM,PPA,techUKandUKTI.

For the latest information on how DataIQ can help your organisation go to www.dataiq.co.uk

For information on how to become a commercial partner to DataIQ, call Adrian Gregory or Adam Candlish on +44 (0)20 3829 1112 or email [email protected] and [email protected]

RoyalMail,thecruciformandallmarksindicatedwith®

areregisteredtrademarksofRoyalMailGroupLtd.

RoyalMailGroupLtd2016.RegisteredOffice:

100VictoriaEmbankment,LondonEC4Y0HQ.

©RoyalMailGroupLtd2016.Allrightsreserved.

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THE USE AND MANAGEMENT OF CUSTOMER DATA - Royal Mail · The use and management of customer data Introduction 03 ... In a business environment characterised by fierce ... departments