In business, data reigns supreme. 👑
Data enables organizations to make major sales and marketing decisions by providing insight into their customers, competitors, and themselves. Nowadays, business growth and strategy are dependent on the ability to leverage data - regardless of if you’re a solo knowledge creator or a Fortune 500 company.
With such high stakes dependent on data, it’s clear why clean, good data is crucial for a business’s success. Inaccurate data - known as dirty data - can lead to unsuccessful business efforts.
Thankfully, there’s a solution - data hygiene. 🛁
In this article, we’ll explore data storage, what data hygiene is and why it’s important. Plus, data hygiene best practices to ensure you’re keeping your data squeaky clean and your business booming.
What types of databases store data?
Before diving into data hygiene, we need to first understand where business data is stored. There are tons of different databases out there, but there are two general types that are most relevant for businesses.
Small businesses will most likely store and access data in a customer relationship management system. This will have information about your leads, customers, and former customers. Records in a CRM typically include things like:
- Contact information
- Demographic information
- Email marketing engagement
- Past purchases of your products or services
- Information on their needs relevant to your products and services
Larger companies may use a more comprehensive business intelligence and analytics database to access even more data points about their business. For example, a clothing retailer would record their sales by product SKU, an airline would have data on their flights, or a software as a service company would record data on how customers utilize various parts of their software. Sometimes, this data gets granular, and there are whole teams at large companies that maintain databases and analyze the information.
Data hygiene is equally important for both use cases. But since we’re focusing on creators in this blog, we’ll focus primarily on data collected through a CRM.
What is data hygiene?
Data hygiene is the collective and ongoing process of ensuring the cleanliness of data. This means you’re maintaining data to ensure it’s accurate, consistent, and reliable. Cleaning data prevents companies, like your own, from struggling with issues created by dirty data.
But, what exactly is dirty data? Data is deemed dirty when it has any of the following characteristics:
- Duplicate information
- Incomplete (think missing contact fields)
- Incorrectly input
- Misspellings, typos, and multiple spelling variations
The bottom line - dirty data is wrong.
The scariest thing about dirty data is that it’s all too easy to introduce errors into your data. Whether you input data incorrectly, don’t update it regularly, or make an accidental change while updating your system, errors can be introduced at any point in your process.
Why is data hygiene important?
Now, let’s explore how dirty data can be detrimental to your business, which are the very reasons why maintaining good data is so important.
- You’ll waste money and time.
Dirty data will cost you. In the U.S. alone, businesses lose roughly $3.1 trillion annually due to poor data management.
It’s not just money that’s lost, it’s also time. A LeadJen study found that sales teams wasted on average 27% of potential selling time utilizing dirty data. Calling the wrong number and reaching the wrong person isn’t fun for anyone.
But, as we all know, time equals money - so ultimately following bad data is a guaranteed way to lose out on revenue.
- Emails and other marketing efforts won’t be properly tailored.
If your database isn’t up to date or is inaccurate, you may send prospects emails or content that doesn’t align with where they are in the buyer journey.
This can lead to fruitless email drip campaigns and other promotional efforts, seeing as they lack accurate information that could turn leads into customers.
These types of missteps have the power to tarnish both your customer relationship and brand reputation. It’s a true double whammy.
What’s worse - missteps like these may result in an increased email churn rate. Unsubscribes, spam reports, and hard bounces are all a real possibility when you don’t tailor your content to your audience’s needs. All too quickly you’ll start to see your email list dwindling.
- You won’t have clear insight into your sales funnel.
Without regularly monitoring and maintaining your database, you’ll lack insight into the quality of your sales funnel. Because of this, you won’t be able to answer questions like:
- How many qualified leads are there?
- What leads should you remove from your funnel?
- What is your churn rate?
Knowing the accurate answer to questions like these will help you determine where you need to invest sales and marketing efforts. You might even develop OKRs (objectives and key results) based on your very own data!
Dirty data defense: data hygiene best practices
As you can see, the downsides of dirty data can be, well, downright devastating to your business. But, never fear - data hygiene best practices are here. Whether your business is a day or years old, these data hygiene practices can be implemented at any point in the life of your business. Let’s get to it!
- Start with an audit.
An audit will help you get an idea of your data’s big picture. It helps you ascertain what metrics are useful and not useful and what information is more harmful than is helpful. With an audit, you’ll be able to answer questions like, “Which data points are needed?,” and, “Which areas are in most need of improvement?”.
Essentially, the audit should determine where problems exist within your data collection and standardization.
- Assess and improve data collection methods.
During the audit or after is a great time to take a look at every source and method by which data enters your systems.
For example, you might streamline your website’s forms, which capture first-party information (your most valuable data), like your content downloads, blog subscriptions, or webinar registrations.
Another consideration is how to minimize manual data entry. Automation tools not only reduce data-entry human errors but also free up time for more important tasks - like making your next viral TikTok (kidding or are we?).
- Pay attention to the small details.
While in life, we try not to sweat the small things - this doesn’t ring true with data. Small errors in data can quickly add up to big issues - like basing a marketing campaign on flawed information. Yikes!
In data collection, ensure that you are doing the following:
- Standardizing mailing addresses
- Verifying email addresses
- Standardizing common abbreviations and numbers
By noticing the small details, you’ll be able to catch larger, more impactful errors. If you discover a handful of both, you may come to the realization that it’s time to incorporate more standardized operating procedures or simple rules for collecting and inputting data.
- Develop an ongoing data cleansing process.
Sorry to say, but your data hygiene journey isn’t over after the initial cleanse. It’s an ongoing process that will require dedication and determination. Remember - dirty data is easily introduced into your systems - so you must watch out for it like a hawk. 🦅
An excellent way to keep dirty data at bay is to create ongoing maintenance and uniformity processes. Here are a few we recommend implementing:
- Data entry standardization. Every data point in your system should be entered in a standard manner (especially if entered manually).
- The handling of data errors. Develop rules (even if they’re just for yourself) that clearly outline how errors will be managed. For example, how will you remedy incorrect or duplicate entries?
- Preventing dirty data in the first place. In practice, this may look like adding essential fields to your data collection forms and removing nonessential fields. Additionally, you may perform a data audit regularly to ensure dirty data isn’t creeping back into your business - by using an outdated lead generation form, for example.
Data hygiene’s bottom line
Solely having data isn’t enough to grow your business or direct sales and marketing efforts.
To avoid losing revenue, time, and customers, and even jeopardizing your brand’s reputation, your data needs to be free of errors. Maintaining your data with hygiene practices ensures you have actionable insights your business can utilize with confidence!
At Kajabi, we believe in the power of data, and not just for large, multi-person companies, but for our favorite type of business - those run by single, passionate entrepreneurs. We’re talking to you!
Not only do we provide the right metrics organized in an easy-to-use web analytics dashboard (you’ll actually use it), but we also offer automatic data hygiene practices like our new contact exclusion filter, which excludes high-risk, inactive members from your lists to protect your sender reputation and strengthen your email deliverability.
If you’re ready to build your dream, data-backed business with Kajabi, start your free 14-day trial here.