If you’re like most retailers, you struggle with the effects of multiple data sources. There’s one for POS transactions, one for ecommerce, one for marketing, one for the call center, one for loyalty, etc. And none of them is talking to each other — at least, not in a timely manner.
Add to this the general rule that 30 percent of the data in a retail customer database will become outdated every year, and what do you get? Inaccuracies, inefficiencies and frustrated customers. Not to mention corporate reporting conflicts and conundrums.
All of this can be particularly damaging to your loyalty and CRM efforts, where an updated, 360-degree view of your customer is required for accurate tracking and targeting. Here’s a strategy to begin tackling the data management beast.
Break Down the Silos
When your data is siloed, it can be an overwhelming task to ensure updates are made quickly and consistently across the board. That’s why the best practice is to have a ‘single source of truth.” You need a master customer warehouse that is the central hub for customer data and prioritizes the information that flows back and forth between the various sources.
The rules and processes put into place to support this type of infrastructure are known as master data management (MDM). Under this structure, the master customer records are consolidated into a central database controlled by a single administrative application that feeds and supports the other customer applications.
It provides a seamless transaction history and a complete view of each shopper. Ultimately, it allows you to maintain reliable, accurate and updated customer data.
Here are four things you need to do to get started:
Create a multi-disciplinary committee: Most companies don’t have a defined owner of customer data, so each business unit manages the data it collects. Creating a task force with representatives from each area that touches customer data is crucial for identifying all collected customer information and avoiding duplication or overwriting of data.
Assign a Data Steward to manage the customer data warehouse: Effectively managing data requires an individual who understands the business requirements for the data and has a technical background to understand data flow and related infrastructure barriers and issues. This “data steward” typically works in marketing or CRM, but is technically proficient with retail solutions and systems. The steward not only has administrator privileges to the master customer database, but also monitors to ensure that all new data is consistent and conforms to pre-established standards.
Create a business plan: The first deliverable from the multi-disciplinary group is a business plan. This document defines the current challenges with customer data and the benefit of MDM, including financial justification. It will outline the steps for building a master customer database that can eventually be integrated with an overall master data hub. The data steward is the business leader for this effort, but it’s essential to have IT involvement.
Map business processes and data flows: To develop a business rule repository that will ensure consistent data quality standards across projects, you need to map current business processes and data flows. Be sure to address which data points within the record are never changed once collected, such as date of birth, as well as “P rules,” defining which data points and which data sources have precedence, so that any given update does not replace a better source, but is added as a secondary reference
There’s no question that moving toward MDM takes time and effort upfront. But you’ll make up for it later. Ultimately, it will translate to positive ROI through more efficient marketing, less waste, greater customer satisfaction and long-term loyalty.
Sandra Gudat is president and CEO of Customer Communications Group, a full-service loyalty and marketing agency.