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Bad contact data costs US companies over $700 billion a year and, the problem is only getting worse. Over 70% of survey respondents say that an increase in job changes since the start of the COVID-19 pandemic has reduced data quality to an all-time low.
The problem doesn’t stop with out-of-date or inaccurate data, the knock-on effects of poor data quality impair the entire go-to-market cycle, including:
Over 50% of sales leaders report that poor data quality in their CRM platform increases operating expenses and costs potential revenue opportunities.
Let’s look at the major costs associated with poor data quality and how companies can reduce operating expenses and extend runway by investing in better data.
Without accurate contact data in your CRM, you can’t identify and prioritize sales leads appropriately. This applies equally to net new opportunities and opportunities to sell to previous customers who have changed companies.
It is almost impossible to run effective sales outreach without up-to-date contact data. Imagine researching a target account and crafting the perfect email only to send the email to an employee that has since changed jobs.
Simply, you can’t sell to someone you can’t reach. And, with the increasing rate of job changes, your cold outbound efforts are only as good as your contact data.
But, missed sales opportunities aren’t just limited to cold outbound sent to an out-of-date contact. A second set of missed opportunities comes from not tracking your existing customers when they change jobs, roles, or companies.
Your previous customers are the secret to new revenue. They are up to 5x more likely to buy from you again, having already gone through the awareness and customer education phases – they understand your product and its value. New decision-makers have fresh budgets and increased urgency to drive impact and will spend 70% of their budget within their first 100 days.
Data decay is an inherent part of any database. According to a survey of 1,000 companies, over 30% of go-to-market teams report that the customer records in their CRM are incomplete, inaccurate, or out-of-date.
Basing mission-critical decisions and processes on bad data increases the costs across every business team, including:
On average, a sales rep will waste over 20% of their time chasing contacts that aren’t at the target account. This equates to a loss of more than $20,000 in time spent selling per year, per SDR.
Or, put differently, your team of 10 SDRs working with stale data is likely performing as well as a team of 8 SDRs with live data.
Marketing campaigns and MarTech run on data to deliver the right messages to the right audience at the right time. Building target audiences and related campaigns based on inaccurate data can have consequences for every part of the marketing funnel.
For example, email campaigns sent to out-of-date addresses or contacts that have moved on can increase churn or even worse can land your company on a deliverability blacklist.
For paid media efforts, if you build lists, audiences, or lookalikes off of bad data, your deliverability, click-through rate, and conversion will suffer – leading to less effective spend.
As the sales cycle gets harder and harder, retention matters more and more.
Retaining existing accounts is a vital part of the GTM process. In order to retain accounts, you need to maintain the relationship with your customers and the various stakeholders, including everyone from the buyers to the end users.
Customer success teams rely on CRM data to nurture accounts, continuing to drive value post-sale and looking for upsell opportunities. Inaccurate data can lead to mistakes like reaching out to someone who is no longer part of the account or missing key opportunities to engage.
Over half of customer success teams have trouble predicting when customers will churn. Without good data, companies will struggle to retain customers, especially if they fail to act when the original buyers and users leave the account.
Knowing who is still heading up your account is crucial since retention efforts are only as good as your point(s) of contact.
Don’t let bad data cost your company time and money. Clean up your existing data and ensure your records are up to date to drive measurable impact across the entire GTM function.
Contact data is foundational to the customer journey, don’t let your most valuable GTM asset decay and turn into a cost center rather than a revenue-generating resource.
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