We've looked at the cost of bad data . But how do you know what data to collect?

Customer data enables you to understand your customers and connect with them in meaningful, mutually-beneficial ways. However, when it comes to data, "more" is not always "better". Asking for reams of data can be off-putting for customers, tricky and expensive to manage, and confusing to use. So, what data do you really need?

The answer will be different for every business. Ask yourself the following questions to help you determine what data you need to collect:

• Does it help you contact your customers in a meaningful way? Many companies either need or want to contact their customers by mail, e-mail, or telephone. Which methods does your company use? Collect, in a consistent way, the data that supports your methods.
• Do you have a place for option information? Not only are their privacy laws, such as PIPEDA to be considered when contacting customers, but your relationship with your customers can be weakened by disrespectful or excessive contact that they don't want. Give your customers an opportunity to tell you how to use their data, and ensure you have a means to track and use their preferences.
• Have you met all your business, legal and ethical obligations? If you offer warranties, have you made it easy for your customers to provide you with the data you need to administer them? If you have a legal obligations to meet (e.g. age restrictions, medical information, etc.), have you made every effort to keep customer data complete and up-to-date?
• Does it support your strategic goals? Data can be used both to support your goals, and to track your progress. If you are attempting to build sales in a certain geography, a certain amount of geographical data will be necessary to measure your success. If you plan on tailoring your messages based on age or gender, then collect this data (again, consistency will enable you to use it efficiently).
• Does it fall into the "maybe someday" trap? Maybe someday we'll contact clients by e-mail ... maybe someday we'll do psychographic analysis ... It makes sense to be forward-thinking, but collecting any and everything because it might be useful someday is sure to overwhelm your customers and your business. Collect data you will use or have concrete plans to use. If you build a healthy relationship with your customers and use what you collect in a mutually-beneficial way, you can always ask for additional data in the future.
• Is there data you can glean without the customer's input? Things like customer anniversary dates (when they first purchased your product or service) can be leveraged for relationship-building and is readily available to you - providing you are ready to capture it.


By thinking through your data requirements in advance, you can ensure that you are well-positioned to meet your business', and customers', needs.