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October 30, 2007 | Customer Relationship Management (CRM) | WineDirect Admin

How Clean is Your Data?

A key success factor in the execution of any direct marketing initiative can be found in the quality of the data which makes up your contact list. Is your data ‘complete’? Is it ‘valid’? Is it ‘up to date’? Each of these questions should be considered by anyone implementing a direct marketing campaign.

Research from Dynamic Markets indicates that 86 percent of businesses admit to having incomplete or inaccurate customer data files. Additionally, 75 percent of businesses admit that potential revenue is lost because of missed opportunities due to poor data quality.

Here in the Direct world of the wine industry, we’re no different. There are several simple activities of data management that should be applied by anyone managing a Wine Club or Allocation program, Tasting Room or E-commerce effort. Conveniently enough, I’ve outlined them here.

Garbage In, Garbage Out
Start at the point of entry. If what goes in isn’t clean, what comes out certainly won’t be either.

Have a Tasting Room?
Ensure your staff has the tools they need to capture complete and correct data. Provide a script to the staff to ensure they are asking all the right questions – for instance, did they ask for an email address? Did they repeat back the spelling and the address to the customer for confirmation?

Have a POS?
There are address validation applications which can auto-complete city and state names by simply entering a zip, as well as validate whether certain addresses exist. By validating with these tools, you ensure your state abbreviations are correct, city names are spelled the way they should be, and apartment and suite numbers actually exist.

Make Data Hygiene a Regular Activity

There are a lot of vendors out there who will take your data, consolidate any duplications (multiple John Smith’s at the same address, for instance), check all names and addresses against Change of Address databases (both physical AND email Change of Address services exist), even validate against Deceased lists and certain non-desired types of businesses. The costs are relatively cheap, and the return is worth it:

Imagine sending 5,000 direct mail postcards to your mailing list and having 15% of them return as undeliverable; at approx $.85 a piece that’s $638 wasted. It’s also a loss in potential revenue – 750 people will not see your message and not have a chance to buy your latest offer.

For Wine Clubs, imagine the savings in minimizing undeliverables. By having accurate shipping information, you’re thereby preventing returns and the inevitable fees that go with them. What’s more, customer satisfaction goes up – by ensuring the customer receives what they were expecting.

The More Relevant Data, the Better

No doubt, segmenting your database (by user preferences, purchasing behaviors, geographic locations, etc.) and targeting the appropriate message to each segment is one of the smartest way to increase conversions to purchase – however we could write a whole book on this subject (and many have). For this discussion, it’s about having relevant and usable data, in addition to complete and accurate data, to ensure you have the basic foundation for a strong segmentation strategy.

You don’t get what you don’t ask for

Do you prefer Red or White wines? Sauvignon Blanc or Chardonnay? Are you interested in Food & Wine pairing suggestions? Have you ever visited our Tasting Room? Don’t be afraid to ask – but also be prepared to do something with the information once it arrives.

Find a place in your database to store the valuable consumer information you are given, and make sure it’s accessible for data segmenting (i.e. add each data point as a field on its own – not in a general notes section that will potentially hold a mix of information). And be consistent in your terminology – in order to easily sort and pull together a usable list from your database, all entries should be made using pre-defined, searchable keywords. Be sure to use consistent spellings or abbreviations for those keywords, and be cautious of importing directly from consumer inputs or you’ll end up with more data cleansing exercises than you bargained for.

Manage Expired Credit Cards

While most information sitting in your database is static, one data point actually loses validity over time: Credit Card expiration dates. As time passes, expiration dates arrive, leaving revenue on the table if we don’t actively manage updates.

For anyone running a Wine Club, it’s mandatory you focus on cleaning up those expirations in advance of a Club run. Run a monthly report to identify expiring Credit Cards and update as appropriate. Not only will it save you from last minute scrambling to contact Club Members with pending expirations, but will also ensure you are getting the most out of your potential Wine Club revenue. If you’re consistently losing Wine Club shipments due to expired credit cards, you’re letting revenue go.

One winery I recently worked with set a goal of reducing the percentage of expired credit cards on their Wine Club list by just 2 points annually. We knew we couldn’t keep up with all expirations, but for those two percentage points of members we were able to recapture, we recognized $48k of potentially lost revenue in the year. A few extra hours of phone calls a month, with a couple of email notifications thrown in, all providing a nice return.

By ensuring your customer database is complete, up to date, de-duplicated, consistent and cleansed, your Direct Marketing initiatives are sure to be off to a good start. For more information, tips and tools for direct marketing and data management, visit www.usps.com or www.the-dma.org.
 

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