Customer data management is the act of collecting, organizing, and using data to better understand consumers. As a result, it will improve conversions and customer retention rates. CDM includes the tools companies use to gather and analyze customer data; the ethical framework of collecting customer data and the security measures associated with keeping and accessing this data.
It is often discuss in terms of first-party data, which refers to information gathered by your business and utilize by your organization. This may include everything from information on how website users explore your website to information about the products and services they have bought.
Golden rules that you must adhere to your business needs:
1. Develop a data governance plan
When it comes to customer data management, the first concept to consider is data governance. This is because effective data governance will assist you in determining what data you will gather and how it will be acquire. It will also ensure that all workers are on same page when it comes to your company’s data management strategy.
2. Make Complete Concentration on the necessary information
You must ensure that you are only gathering information that is relevant to your company’s operations. Unnecessary data collection causes your customer data platform (CDP) to become overburdened with information. Unnecessary data may also lead to you gathering information about your clients that they find offensive or upsetting.
3. Do not create data silos
Data silos can exist when data is gather by various departments within the same business but is not share by those departments. Usually, this isn’t done on purpose. Both customer service and product success would benefit from knowing what kind of input is being receive on social media; but this is not possible since data silos exist.
The abandonment of a shopping cart is one of the data points track by your website analytics team. A number the development team would want to know so that they may take measures to minimize cart abandonment if it requires.
The sales team may make use of a customer relationship management (CRM) that has information which marketing team needs. Data is most effective when it is share across departments; since it encourages cooperation and problem-solving throughout the organization as a whole.
Data cooperation enables marketers to get a comprehensive understanding of the customer journey and the numerous touchpoints that occur along the way. It enables the product management team to create goods that are more in line with the expectations of their customers.
4. Data security is necessary
Even while data security has a straightforward definition — “the protection of data against unauthorized access, use, modification, disclosure, and destruction” – it is a very complicated subject. Customer privacy is important no matter what kind of information you gather from them.
If you are utilizing a customer data platform to handle your customers’ data, you may not have much influence on the data security requirements that are implemented by that platform. That is why it is critical to ensure that the platform you are utilizing has a security program that is compliant with ISO 27001 standards.
5. Make sure you have a process in place to verify that your data is accurate
The accuracy of your data may impact when it is collected. But, it can also affect months or years later since data changes with time. This is refer to as data decay and can affect in both directions. Data can be inaccurate at the time of collection when a business does not have a clear data governance policy in place.
It is also possible for data inaccuracy to occur if data collecting events are not set up appropriately. Automated data validation may be utilize to resolve this issue. The customer data management will go over your tracking code to ensure that it is in perfect functioning order.
6. Compliance with data protection laws
When data privacy becomes more important to the general public; governments pass laws akin to the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act.
These regulations have already had an impact on the way businesses gather and store information about their consumers. It is increasingly critical to get permission from website visitors before collecting data about them. As a result, many business websites now include banners asking for your consent to use your personal information. Users must have the ability to not only view what information you have gathered but also to request that you remove that information from your system.