Data has an impact on all areas of business, whether its a credit controller assessing an application of a new customer through to a sales team prospecting for new business, the data must be accurate.
Poor data hygiene leads to:
Flawed insights and decision making
Inaccurate data in sales can lead to unreliable forecasts and poor personalization in your messaging. If your sales team create multiple entries of an opportunity or the close dates are inaccurate, you could find that cash flow isn’t as free as you thought. Or in another scenario, you may have identified that ABC Inc. is in the manufacturing sector, and you send them a brochure tailored to the industry, but it turns out they are apparel retailers – Now your messaging is less likely to engage them.
Reduced efficiency and wasted time
Bad data can also lead to time wasted when prospecting for new business. Around 1 in 12 businesses in the US close every year, so where a rep might spend hours contacting 250 prospects in your database, upwards of 20 of these may no longer be in business. This results in wasted hours and demotivation in your sales team.
Additional expenses
Something as simple as inaccurate company addresses can lead to significant additional costs. One example is the cost of sending mail to incorrect company addresses and having to correct that, but then there are additional costs that can result. Late invoicing due to not having accurate address details can lead to a higher DSO and additional interest payments on your own outstanding credit obligations.
Lost revenue opportunities
It is estimated that bad data costs the US economy $3.1 trillion per year, which in large part is due to missed opportunities. Missed opportunities can occur when group structures are inaccurate, and you don’t realize that an existing relationship can be used to sell into an affiliated business. They can occur when your database is missing key prospects due to a lack of market coverage, or it could be because you aren’t able to engage them efficiently as you don’t have an accurate business profile built. There are a whole range of reasons why bad data can cause your business to lose out on revenue opportunities.
This is why it is vital that the data in your CRM system is accurate.