Love used to make the world go ‘round. But today, that’s data’s job. Companies rely on data to:
- Learn more about markets and customers
- Make business decisions
- Stay competitive in their industries
First, companies need a master data management (MDM) strategy to keep customer data organized.
That's easier said than done. IDC estimates the amount of data created in the next three years will equal the amount of data created in the last 30 years. It will soon outgrow storage capacity. Customer data, in particular, is growing at a breakneck pace. That makes it harder to organize and control.
Here's another layer of complexity. Gartner estimates that businesses lose an average of $15 million per year due to poor data quality.
These are challenges we can’t afford to ignore. Overcoming them starts with getting a firmer grip on MDM. It’s a Herculean task. We suggest you break down your MDM into smaller objectives. Start with the lifeblood of your company: customer data.
In this post, we’ll dive into the basics of customer data management. We will explore how it’s used and provide tips for integrating a customer data platform (CDP) to centralize your data strategy.
Table of Contents:
So, what is master data management?
How does master customer data management fit into MDM?
How can MDM and customer database software support my organization?
What tools can I use to support my customer master data management strategy?
How to create or improve a customer data management strategy
So, what is master data management?
We define master data as being a single source of truth. It is a consistent, uniform, reliable set of data to provide context to an enterprise. Think of a master key. Most keys can unlock one door, but a master key offers unfettered access throughout an entire facility.
Master data management, or MDM, integrates data into a predictable, usable, organized format. It provides an organization with a single point of reference. Business users and IT work together to ensure that an organization's data is:
- Uniform
- Accurate
- Consistent
- Accountable
Every organization has different preferences for managing a database. But all organizations need a centralized visual hub that allows business users to interpret big data in real-time.
How does master customer data management fit into MDM?
Customer data management (CDM) is a slice of the MDM pie. Managing a CDP involves creating a framework that determines how to collect, analyze, and manage relevant customer data from various sources (e.g., social media, email, live chat, etc.).
CDM software helps companies gain a unified view of every customer. CDM also enables an understanding of a company's target customer base as a whole.
With CDM, you do not have to rely on generic buyer personas that reveal little about your customers' unique characteristics. You can go beyond basic segmentation or surface-level demographic information. Marketers can create stronger personalized experiences and cater to their customers' needs.
How can MDM and customer database software support my organization?
Countless global brands use customer MDM software for many use cases. Some examples include:
- Visualizing complex customer data to enhance data-driven decision making
- Connecting the dots between disparate data types and channels
- Spotting trends and patterns
- Aligning key business drivers
- Streamlining reporting
- Gaining unprecedented cross-department insights that can help future-proof the organization
Let’s take a look at a handful of some of these use cases in more depth.
Real-Time Performance Tracking
Customer MDM helps you present complex information with cohesive and interactive visual dashboards. Data management solutions often allow you to create unlimited, customized screens or dashboards. With these dashboards, you can see an overview of the data and drill down into insights if needed. Data points are presented in real-time, and visualizations automatically update in response to data changes. This allows you to quickly access critical insights and signals for:
- Dynamic situational awareness
- In-meeting answers
- Performance tracking
- Smarter decision-making
Real-time updates in centralized data management solutions ensure accurate metrics and KPIs. Most customer MDM tools have link-sharing functions. Executives can share:
- Real-time insights
- Metrics
- Visualizations
- Personalized comments
You can share all this with anyone, from any device, anywhere in the world. Your team will always be in the know. They can pivot strategies to ensure your brand remains relevant and competitive based on real-time data analytics.
Unify Customer Data Sources
Centralized data analysis tools can gather data from:
- Your own applications
- Third-party business systems
- Online news
- Social media conversations
- Job postings
- Financial filings
- Patent filings
- Product reviews and more
With the right tools, data combines to visualize:
- The full story of your brand
- Your competitive position
- Your customer experience
Customer management solutions are often customizable. You can configure them for a variety of use cases across business functions.
Business-Critical, Actionable Insights
Customer data doesn’t exist in a silo. If you treat it like it does, you run the risk of studying vanity numbers. Since data doesn’t exist in isolation, neither should teams. Customer MDM unifies information to give you access to the full picture.
For example, insights found via media monitoring matter a lot to martech professionals. But this data can also inform core business decisions beyond brand management, such as:
- Creating competitive advantage through supply chain risk mitigation
- Optimizing processes
- Improving customer experience
- Trendspotting
By combining first-party and third-party data sources, you can better understand your position and competition. You can eliminate blind spots and identify developing threats and opportunities.
What tools can I use to support my customer master data management strategy?
Data analysis traditionally kept professionals up at night. Thanks to technological advances, customer data management platforms (DMP) make analysis easier. Consider Meltwater's Consumer Insights platform, which stays on top of new trends, opinions, and preferences. We integrate data from across the web, including:
- Social media
- Customer reviews
- Comments
- Podcasts
- Forums
- Blogs
- Videos and more
Our goal is to access real-time social data to understand what really motivates your customers and to empower your decisions. Another powerful tool for managing customer data is the Meltwater Suite. Old-school market research methods included:
- Planned interviews
- Focus groups
- Expensive third-party studies
These methods took weeks or months to yield useful feedback. Today, market research enables a continuous cycle of intel on your customers, competitors, and industry. Users can collect, analyze, and visualize data all from within the software. You can:
- Cater to multiple audience segments
- Make personalization an easier and more effective process
- Follow the market
- Showcase your results with custom reporting
Consumer insights and market research are not just internal customer management systems. They also take into account your total addressable audience. That includes customers that fit your target but haven’t yet purchased from you. By looking beyond your own first-party data, you get true master data that will help you improve every touchpoint and expand your business using reliable, actionable insights.
How to create or improve a customer data management strategy
CDM isn’t just about collecting and organizing your customer relationship management (CRM) data. It’s about making all that data work for you. With this in mind, let’s look at three principles you need to follow to create or improve your CDM strategy:
1. Flesh Out a Data Governance Strategy for Your Customer Data Platform
How do you write your date in your CRM system: MM/DD/YYYY or MM/DD/YY? Both of these tell us the same information. But only one way is correct — and it’s up to you to choose which one.
This is an example of why data governance matters. For master customer data to live up to its potential, you need to ensure that information enters your customer database software in a consistent format. Otherwise, when your data tools are compiling insights from your CRM system or other channels, key information might be overlooked simply because it’s formatted incorrectly.
With governance in place, you can ensure that all data will be entered correctly and, therefore, will be usable. Put it down on paper so that you can turn your users into good data stewards.
2. Only Collect Data You Really Need for Your Customer Management System
The amount of customer data available is overwhelming, and the pile only grows. In the case of CDP management, this is one time where quality matters more than quantity. Not all data will be valuable to you, so you need to get specific about what data you really need and why you need it.
This serves two key purposes:
First and foremost, it reduces the burden on your customer management system. It prevents data overload, plus it’s easier to find helpful data when useless information isn't overshadowing it.
And second, it reduces the burden on your customers. For instance, if you collect data from a form, asking too many questions is a surefire way to make customers skip it and move on. It can also make them uncomfortable. Consumers are more discerning than ever when it comes to sharing their data with companies. In fact, one report found that just one in five customers trust global brands to keep their personal data safe.
So, before you implement your CDM, give some weight to the type of data you’re collecting in the first place. Ask yourself:
- Do I need it?
- What purpose does it serve?
- If we didn’t have this data, could we still achieve our objectives?
Not having these answers doesn’t mean you can’t collect a certain type of data. But it can help you instill trust in your customers and improve your processes when your data goals are clear.
3. Take Advantage of a Purpose-Built CDP
An all-in-one, cloud-based platform brings all of your channels under the same umbrella. It allows you to avoid data silos and connect the dots so you can learn more about your customers at a glance.
With better customer profiles, you can improve everything from segmentation to personalization to marketing. Empower your sales team when you identify customers who are most likely to buy from you. Cater to every phase of the customer journey by providing best-in-class recommendations at the right time.
From CRM software to marketing tools, built-in analytics to a 360-degree view of the customer, the right collection of features and functions can make customer database management easier and more effective.
By now you have a better idea of what customer MDM is and why it’s essential to your business. As with most things, it’s easier to show than tell. If you’re interested in seeing what this discipline could look like for your company, get a demo today – we’d be happy to show you!
