Data Quality in Retail

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1 SURVEY RESULTS Data Quality in Retail How Data Quality Issues Impact Business Processes and Decisions Across Retail Organizations

2 TRILLIUM SOFTWARE Introduction As consumers share data across multiple channels to research, purchase, and review products, retailers must wade through increasingly large, complex data volumes to get the business insights they need. However, most customer data that retailers rely on is inaccurate, incomplete, and distributed across siloed storage centers, resulting in the inability to make timely, data-driven business decisions across all areas of the business. According to a recent study conducted by Retail Systems Research, 54% of retail business leaders cite not having a single view of customers across channels as their biggest inhibitor to more revenue-generating marketing campaigns and customer interactions. 1 Yet, as retailers strive to stay at the forefront of innovative customer analysis and targeted interactions, they are increasing spend in technology to support big data, customer relationship management, e-commerce, and other data-driven business initiatives. A recent study by global research firm IHL Group predicts that technology spend in the retail and hospitality markets will increase 5% this year over 2014, surpassing $190 billion in global spend. 2 Without access to reliable, fit-for-purpose data, these technology investments risk delivering inaccurate insights for downstream business processes and decisions. To gain further insights into how these trends impact retail organizations, Trillium Software surveyed 50 business and IT decision makers within the retail industry about the ways in which poor customer data quality impacts their organizations. Results from this survey indicate that poor data quality poses a significant threat to the effectiveness of a wide range of business functions, despite the relative maturity with which retail organizations use data-driven marketing techniques. 1 Retail Systems Research, Omni-Channel 2013: The Long Road to Adoption 2 IHL Group: IHL Forecast: 2015 Retail IT Spend to Surpass $190 billion

3 Survey Results: Data Quality in Retail Data Quality Issues Among Retail Organizations Because customer data plays such a significant role in so many retail business functions, it is critical for retail organizations to understand just how pervasive the impact of poor data quality can be. In our survey, respondents revealed that challenges attributable to poor data focus not on a limited number of tasks, but instead on a broad range of conventional marketing activities (Figure 1). While e-commerce personalization and loyalty programs were the functions cited most frequently, that each item on the list was selected by at least 14% of respondents is indicative of the variety of ways in which poor data quality impacts retail organizations today. Which of the following business functions is negatively impacted by the quality of your organization s customer data? E-commerce personalization 34.69% Loyalty programs 34.69% Fraud identification 26.53% Up-selling and cross-selling 24.49% Customer service personalization 22.45% Multichannel marketing campaigns 22.45% Customer privacy and security management 20.41% Order fulfillment 20.41% Product launches 18.37% Warranty management 16.33% Billing and payment collection 16.33% Mobile offers/coupons delivered in real time 14.29% Other 6.12% Figure 1: Based on 133 responses from 49 respondents.

4 TRILLIUM SOFTWARE When considering the quality of customer data for any type of organization, a number of factors come in to play, each of which will negatively affect data quality if not adequately addressed. Within the retail industry, inaccurate contact information, missing demographic information, and missing contact information are the attributes of poor data quality that most commonly impact dayto-day business operations (Figure 2). Clearly, these types of inaccuracies or omissions can severely impede the effectiveness of most business initiatives and activities, including those listed in Figure 1. Beyond that, however, results showed that many retail organizations are also negatively impacted by other attributes of poor data quality: inconsistent formatting, insufficient integration of multiple data sources, duplicate records, and insufficient linking of customers within the same household were each cited by at least 18% of the respondent base. That each of the attributes listed was selected by a significant portion of the respondent base is again indicative of the variety of ways in which poor data quality impacts retail organizations today. Which of the following traits of poor customer data quality significantly impacts your team s day-to-day business processes? Inaccurate contact information 57.14% Missing demographic information 42.86% Missing contact information 40.82% Inconsistent formatting (e.g., phone numbers) 28.57% Insufficient integration of multiple data sources 26.53% Duplicate records 20.41% Lack of householding 18.37% Other 2.04% Figure 2: Based on 115 responses from 49 respondents.

5 Survey Results: Data Quality in Retail Data-Driven Technology Investments Planned by Retail Organizations While many organizations expect to make technology investments in data quality in the next year (Figure 3), it is critical that these organizations identify and understand their unique data quality challenges before making a significant investment. Furthermore, organizations must also understand the impact of data quality on planned activities or investments that have not yet been rolled out. The other areas in which respondents expect their organizations to invest particularly big data, customer relationship management, data warehousing and storage, data governance, and data integration further strengthen the case for investing in a data quality solution; for without good data, the return on each of those investments would be significantly limited. In which of the following areas do you expect your organization to make the biggest technology investments next year? Big data 34.04% Data quality 34.04% Customer relationship management 23.40% Fraud detection 23.40% Data warehousing and storage 21.28% Data governance 19.15% Data integration 19.15% E-commerce 19.15% Business intelligence and analytics 12.77% Marketing automation 12.77% Mobile enablement 10.64% Regulatory compliance 10.64% Vendor management None of the above 0.00% Other 8.51% 10.64% Figure 3: Based on 122 responses from 47 respondents.

6 TRILLIUM SOFTWARE How to Build Better Customer Relationships on Better Data Although most retail organizations plan to invest heavily in data-driven platforms and applications, retail business leaders must realize that those tools alone won t relieve the pressures or solve the complexities of high-volume, diverse customer data sets. Without a way to access, integrate, and improve the vast array of customer data points collected on a daily basis, retailers will always be unable to identify and understand their customers. By implementing a data quality solution as the foundation of any technological infrastructure, retailers can glean timely, reliable business insights from customer data. These solutions ensure incomplete or unverified customer information that enters an organization is standardized to a more complete format and made accurate and up to date. Additionally, they link disparate data sources together to maintain the most accurate customer records upon which various applications and platforms can draw in order to help businesses: Increase revenue and conversions by executing more personalized, omni-channel campaigns Decrease campaign costs by eliminating duplicate records and verifying customer contact information Increase customer retention and loyalty by delivering targeted offers based on accurate customer insights Improve fraud detection by providing accurate records of buyer behaviors Single, complete versions of customer information provide retailers with the data they need to strengthen customer interactions, improve performance, and maintain a competitive advantage in an innovative market.

7 About Trillium Software Recognized by analysts Gartner and Forrester as a data quality leader, Trillium Software provides cloud and on-premise enterprise data quality, data profiling, and data governance software and services to ensure that accurate, consistent, and complete information is available to improve customer service, increase efficiency, decrease costs, and meet regulatory compliance initiatives. Trillium Software s platform-independent suite of technologies and services helps IT and business professionals with global data profiling, data cleansing, enrichment, and data linking initiatives that deliver value for your web, CRM, data governance, ERP, big data, data warehouse, business intelligence, and other enterprise applications in less than 90 days. For more information, visit

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