Data is the new oil for businesses today. Every business is talking about deriving value and insights from their carefully obtained data. It has become the biggest asset for marketers, agencies, media companies, and more. However, data can only be valuable and helpful if its quality is high.
On the contrary, bad data, at best, is inconsequential and can put companies on the path to disaster and heavy financial losses. Research by IBM has estimated that lousy information costs $3.1 trillion per year to the U.S economy alone. This is the cost spent correcting mistakes and making up for bad decisions caused by insufficient data. Maintaining a standard for your data and improving its overall quality is extremely important.
What Is Data Quality?
Data acquired should support the outcome it is being used for. Data quality measures how well a specific set of data is suited to fulfill its purpose. This purpose can range from data usage in operations, decision-making, product development, forecasting progress, or research for new products. Standard data quality measures include completeness, validity, accuracy, and timeliness.
Why Is Data Quality Important?
With the increase in digitalization and improvement of overall technology, data has become an essential aspect of every business. Leveraging data is all about improving your service, maximizing your potential, and keeping up with the competition. The big names in each industry are consistently improving their service through data-driven decision-making. Companies that do not take advantage of and make full use of available data are at a disadvantage in this era.
The higher the data quality, the better your decision-making will be, which will ensure that your business mitigates risks associated with uninformed or instinct-based decision-making.
Artificial intelligence (AI) and automation are heavily dependent on data and have a vast potential that is now being recognized in almost every industry. Alongside that, machine learning also requires enormous volumes of quality data with high levels of accuracy. Algorithms determine the success of machine learning, and better data improves the overall algorithm in such cases. More than three-fourths of the respondents in a survey of senior executives by New Vantage Partners stated that improved data volumes and sources are the driving force behind high investments in cognitive learning and AI. Improving data quality has become a top priority everywhere.
Data quality is critical as it is essential for compliance-related issues. Data regulations have continued to evolve and broaden, making it vital for businesses to improve data quality and manage their data properly. Compliance with these laws becomes increasingly complex when your data is poorly managed or disorganized. This can also harm a business’s reputation and goodwill if the sensitive data, including clients’ contacts, become public or gets hacked.
How to Collect High-Quality Data
Collecting high-quality data is quite a challenging task in itself. If your company is new and starting to integrate data systems in various applications across all departments, problems can arise in this shift to automation from manual data recording. These challenges may also result from inadequate tools and processes in place.
If you aim to collect high-quality data, you should create an extensive data collection plan for your business. Determine the data needed to meet your goals and establish measures to collect that data effectively by seamlessly integrating with your other systems. It is essential to plan the roles of personnel from each department and communicate these effectively to avoid any confusion in the future. Create data quality standards that can ensure data accuracy and differentiate between the data to be kept and removed. This will improve the data standardization and maintain consistent quality in the longer run. All departments should be involved and must understand these standards to comply with them in their practices.
How Quality Data Can Benefit Your Business
Good data management is the key to keeping up with the rising competition today. It enables you to seize opportunities swiftly and make accurate decisions to benefit your business in the long run. Here are some potential benefits that quality data can reap for your company:
1. Improved Decision-Making
Improved data quality is directly related to more informed decision-making processes. Good-quality data mitigates the risks of uncertainty associated with decision-making and enables the management to anticipate the results and impact of each decision beforehand. The better-quality data you have, the more realistic your choices will be, and you will automatically have more confidence in your choices.
2. Better Market Segmentation
Data quality enables your business to improve its audience targeting and segmentation. Without accurate and high-quality data, marketers cannot segment the audience and do targeted marketing of a product or service, leading to inefficiencies. On the contrary, high-quality data enables you to target and segment your audience into groups based on demographics, interests, age, and socio-economic strata. This will let you find potential new customers, and you can use this knowledge to develop new products and identify market gaps.
3. Effective Marketing Campaigns
Alongside improving targeting, data quality enhances marketing results. Increased data about audiences can let you design campaigns of maximum impact. For example, as a sports publisher, you can collect data about the most popular sports among your website users. You can then make content that fits your audience’s interests, maximizing the impact of your marketing efforts. This will ensure that your existing customers are catered to and consistently engaged with your content. It will also allow you to keep up with the changing demands and trends in the market and predict the changes in the market for better marketing campaign planning.
It is now more important than ever to keep up with the rising competition in each industry due to the e-commerce boom. Good quality data holds significant benefits for your business. If you create a data collection plan, establish data management measures, and a backup plan for correcting inaccurate data, you will pave the path to acquiring quality data for your business. This will help you make more strategic and well-informed decisions that will positively impact your operations.