The Do’s And Don’ts Of Using Customer Data

Customer data is information collected from your customers that can help you to personalize your marketing. It could include information such as age, gender, location, IP address, cookies and purchase history.

Using such information, it’s possible to target specific customers with specific promotional strategies. Such information can also help you spot trends, predict future trends and alter your marketing to help attract new customers. You may even be able to use such information to automate processes and train AI.

While such data can clearly be very useful, it’s important to remember the importance of privacy and security while handling this data. You should also make sure that you’re not using data in a way that could be seen as manipulative or annoying. By understanding the dos and don’ts, you successfully put customer data to use without there being any negative side effects. This post lists a few of the most important dos and don’ts.

Do invest in database software

It’s convenient to be able to compile all your data in one place. It’s also important that this place is secure and easy to navigate. Database software makes a great solution because it ticks all of these boxes. Often powered by the cloud, such software can hold huge amounts of data and keep it secure from hackers, while having easy search and sorting functions to help you find your way around.

Popular database software options include Oracle, MySQL, Knack, Microsoft Azure, MongoDB, Grist, Salesforce and Ninox. Different types of software may be specialized to certain types of data so bear this in mind. 

Don’t hoard data you don’t need

While it can be useful to collect an array of different types of data, you need to make sure that the data you collect is actually useful. Once you start hoarding data, it will become harder to sift through and you may end up having to continuously pay to upgrade your storage limit. By focusing on the collection of useful data, you can prevent this.

Consider the types of data that you can truly make use of. While knowing the age of customers could be useful, consider whether you really need to know their ethnicity or religion. Make sure to also periodically get rid of old data. While it could be useful to look back at past customer data trends, you should consider whether there is any point in collecting 10 year old data of customers who have long stopped using your service.

Do ask for consent when collecting data

Many countries now have data ethics laws in place that require companies to ask for consent before collecting personal data. GDPR is the most notable set of data protection laws and applies to all customers in EU countries. If your company serves customers from EU countries or you allow EU internet users to visit your website, you must comply with GDPR. If it’s discovered that you’re not complying, you could face heavy fines.

Asking for consent often involves a simple tick box in a form. When collecting internet cookies, it’s important to have a cookie consent pop-up on your website. Other forms can be used to ask for consent when collecting other types of data.

Don’t forget to keep data secure

Using trusted database software can help you to keep data secure. However, it could be important to also introduce other measures. This is particularly important when it comes to protecting sensitive data such as credit card details, medical records, log-in details, personal addresses and contact details. 

Many database software programs allow you to restrict certain users.from accessing certain types of data. For example, it could be useful for employees to access data such as the name and age of customers, but you may not want them having access to credit card details. Making sure that your internet connection is secure is important too, as well as introducing protocols to prevent employees clicking on dodgy links or sharing certain information via email. 

Do consider proactive ways of collecting data

While many analytical tools like Google Analytics and Salesforce can automate the collection of customer data, there is data that you can also manually retrieve from customers through traditional methods. Such traditional methods could include polls and surveys, and could be used to collect all kinds of useful information about customer behavior and preferences.

Think about the types of data that would be very useful to have that you cannot currently extract. For example, if you own a plant-based milk company, a survey could be useful to find out information such as how many of your customers are vegan or how many have lactose intolerance. This could give you a good idea as to how to target your marketing.

Don’t just use data for your own benefit

Too many companies use customer data selfishly. While such data can help you to create better targeted adverts and adjust pricing, you can also use it to improve the customer experience and reward customers. For example, you can use a customer’s data of birth to send automated birthday emails with coupons, or use their purchase history to help them collect loyalty points.

Thinking about your customers will help you to maintain loyal customers and also encourage positive reviews

Do keep track of changing data trends

Customer trends can change over time. It’s important to use your data to track these changes and adapt your marketing strategies and the way you conduct business.

For example, what happens if the age or the location of your target audience changes over time? If you’ve been marketing your product at younger people, but more older customers are taking an interest in your product, it may be worth adapting your marketing to tap into this demographic.

Don’t let data trends narrow your scope

You may find that your company appeals more to certain demographics, that certain products sell more than others or that certain days of the week are better for sales. While it’s worth making changes to accommodate these trends, it’s important not to narrow your focus too much.

For example, 70% of your customers may be men, but 30% could be women. If you make your market too male-focused to accommodate the 70% of male customers, you could end up losing that female segment of your audience – and potentially losing more customers than you gain. Feel free to market more heavily to men, but make sure that you're not exclusively marketing to men.