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CRM Data Quality: Why Accuracy Matters

Martin Doyle December 17th, 2013 Data Quality
CRM data quality accuracy

Why does CRM data quality matter so much? Does it really impact the organisation if we have duplicate records? How can the contents of a database affect the bottom line?

In this article, we’ll look at segmentation, one of the most powerful ways to use your CRM data. Crucially, its effectiveness hinges on the completeness and accuracy of data in your CRM.

What is Segmentation?

In order to understand business cashflow, it’s sometimes necessary to segment data. By slicing and dicing your figures in different ways, you get more of an insight into how your business is performing.

The way you slice data is called a segmentation model, and there are various models to choose from. One of the most effective, in terms of planning marketing and measuring ROI, is RVF segmentation (also called RVF analysis).

About RVF

RVF stands for recency, frequency and value. It’s a segmentation method that measures three key things:

  • How many customers you have.
  • How often they spend (or interact, depending on your business type).
  • Who spends the most.

RVF helps businesses to understand loyalty and see opportunities for improvement.

How to Leverage RVF Analysis

Armed with good quality data, you can quickly see which customers are spending the most with your business. Other metrics, such as the last time they logged in, might help you to understand their general level of engagement.

It’s important to segment your customers and market to them appropriately. Those who are spending the most don’t need to be targeted with quite so many marketing emails, but those whose interest is tailing off could be easily convinced to spend more if you market bundles or coupons for increased loyalty. Those whose interest has waned could potentially be won back if they are reminded of your unique selling point (USP).

The Role of Data Quality In Business

RVF analysis is the ultimate validator of a data quality initiative.

Using the examples above, we can quickly see how CRM data is made useless if it’s not accurate and complete. We cannot evaluate loyalty, spend, engagement or conversions if our CRM is riddled with duplicated records. We cannot capitalise on our RVF analysis results if we do not have the correct contact information for the contacts in the CRM. And without deduplication software, we could wreck our ROI by sending wasteful marketing material.

Segmentation is a useful component in a wider marketing strategy. It’s not possible to predict all customer behaviour, but without accurate, quality data, we cannot even scratch the surface of what our customers’ behaviour means. We also cannot measure loyalty, one of the most important indicators in modern business trends.

If your CRM data is out of date, don’t base any marketing activity on it. Don’t pursue any market research projects. And don’t try to sell anything new. Your first priority should be the cleansing and deduplication of your CRM data, since that is the foundation which your future profitability is built on.


Written by Martin Doyle

Martin is CEO and founder of DQ Global, a Data Quality Software company based in the UK. With an engineering background, Martin previously ran a CRM Software business. He has gained a wealth of knowledge and experience over the years and has established himself as a Data Quality Improvement Evangelist and an industry expert.