The Truth About Data
These days, you would be hard pressed to find a company that hasn't made some level of investment in CRM and big data. CRM, as a practice, is critical to understanding consumers' behavior and tailoring business strategies to meet their needs.
A recent Gartner report shows that CRM technology—especially SaaS-based systems—experienced impressive growth year over year, and this growth is expected to continue. The proliferation of new technology gives businesses large and small countless options for customizing their own CRM strategies.
Companies are also investing more in big data initiatives. A recent IDG study predicts that enterprises will spend about $8 million on big data in 2014, and 70 percent of enterprise organizations have or are planning to deploy big data–related initiatives. The promise of big data is a move toward data-driven decision-making. And by integrating big data into their CRM solutions, companies can better predict behavior, improve customer service, and gain powerful insight into their customers' wants, needs, and interests.
Quality of data trumps quantity
As increasingly massive amounts of data are made available, companies are seeing incredible potential to use this information to guide strategy, drive revenue, and open possibilities for growth. Unfortunately, this is easier said than done. Too many companies have made considerable investments in CRM and big data, only to see those investments fall short of the intended ROI.
The data itself is only a tool for increasing engagement; it is not the end solution. For instance, a successful marketing strategy doesn't only hinge on the quantity of data you collect—it's about having the right kind of data that informs campaigns to better connect with consumers and drive them to act.
Before companies begin to collect any data, they should have a well-thought-out strategy as to what they want to measure and why. CRM systems and big data capture are substantial investments; the more data collected, the more substantial this investment becomes. To maximize ROI, companies must first consider what insight is really needed to enhance the customer experience, product design, marketing strategy, etc. It is bad practice to cast the data net wide and bring in everything with it. A net cast too wide is bound to bring in a good amount of junk. And junk data either sits in a warehouse collecting dust, or it interferes with the information really needed to move the needle.
It's how you use data that really matters
It's a common fallacy that mere investment in CRM systems and big data capture will grow a business. This is far from the truth. Again, the data is only the tool to increasing customer engagement—just having it only gets you halfway there. Data itself doesn't drive sales. Targeted marketing campaigns and new products built from customer preference data do.
Once the data is collected and analyzed, how are those insights translated into tangible solutions? How does the data enable the
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