If you're running any sort of business, you know that customers (in whatever form they may come for you) are basically the lifeblood of your organization. Big businesses understand this and act on this understanding - most large businesses in the developed world spend a fair amount of money and energy obtaining valuable lead and customer data. Small and medium-sized businesses, however, too often forgot the important task of collecting high-quality customer and lead data.
Whether you're running a mid-size organization or are self-employed running a business from your home, if you're dealing with customers or interacting with potential customers, then you need to keep good track of related data.
Why do so many businesses fail to do this?
Many small business owners and mid-size business owners and managers don't prioritize customer and lead tracking for a variety of reasons. These reasons may include:
- literally not knowing how important it is - they simply might not understand the long-term value that high-quality tracking of customer and lead data can bring down the pipeline in terms of increased sales (from both repeat customers and referrals), increased understanding of the business, or improved processes/services
- they may not think they are capable of it - they might be intimated and think that special knowledge, special staff, special/complex processes, or special/costly software would necessary to properly carry out high-quality customer/lead tracking
What does good customer/lead tracking and data obtainment look like?
Good customer/lead tracking and data obtainment means that you obtain data from the various touchpoints leads and customers have with your business. The words may sound a bit complicated, but the message is very simple - keep track of the important stuff related to your interactions with people in your business. Businesses interact with customers in many ways and at many stages of the sales process. These can include the following:
- website clicks
- emails/phone calls/messaging online
- customer service issues
- repeat visits
Good customer/lead data tracking means:
1. Capturing relevant, high quality, and accurate data at each one of these touchpoints
By relevant, we mean things that are actually important to your business. This shouldn't be hard for a business owner or a knowledgeable business manager to accomplish. As a very basic example, if you're running an ice cream shop you might want to know things like the age of the customer, their zip code, and their email, but you probably wouldn't care about their height or their hair color because those wouldn't assist in you making useful predictions for the future or assist you better understanding your customers from a business-related perspective. Knowing their zip code will improve your advertising methods and strategies, but knowing their hair color will be pretty much irrelevant in anything you might want to do related to the business.
By high quality we mean that the data should be easily understandable (eg. simple descriptive terms instead of irrelevant and complicated numbers/letters), sufficiently descriptive so as to not mix it up (eg. if you're selling things to students, tracking actual schools is better than just tracking whether it's elementary or middle or high school or college which is better than tracking whether the student is in K-12 or college - the increased granularity will be beneficial but can still allow for aggregation if needed - eg. combining all elementary schools to see how many customers come from elementary schools)
By accurate we literally mean accurate - they key is to make sure the data your recording isn't garage - it's "garbage in, garbage out" with data. It's better to have no data at all than to have inaccurate data. To obtain accurate data you must build rapport with customers so that they give you real information, not random information just to get you off their back.
2. Storing the customer/lead data in easy to access ways
Storing it on a purpose-built system is better than in a nice and clean Excel file which is still better than having data scattered in many different files and formats which still better than having a ton of data on paper forms in a filing cabinet. You want to quickly transfer data to digital formats because that's really the way to back it up, monitor access to protect customer privacy and business knowledge and to be able to manipulate and analyze it. Remember to always be mindful of customer privacy.
3. Using this data in light of the business knowledge to go from simple data to actual business intelligence - data itself is useless but data combined with insight and analysis can create intelligence
Why is it important to track customer/lead data?
By obtaining good quality data (and turning that data into high-quality intelligence), you can learn so much about your business. You can learn things like:
- where most of your customers come from in terms of location (eg. which zip code do they come from, which city do they come from, etc.)
- how much your customers spend on average
- how many times your customers return
- lifetime customer value (LCV)
- the cost of customer acquisition (CCA)
- general market sentiment pertaining to your business
- revenue drivers for your business
- how you get your customers (eg. Google, Yelp, Facebook, referrals, etc.)
- conversion rates
- return rates
- things that can improve your overall processes/systems
Now, it's easy to argue for the importance of tracking data - but it's a bit difficult to do ti properly. the key is to set up a consistent and quality data obtainment system soon - don't wait until everything is perfect. A lot of business owners and managers procrastinate on this - they feel they don't have the time, the size, the money, etc. to do this now and they postpone it into the future until some "right time" comes along. This is ludicrous on many levels.
It's totally inappropriate to postpone the implementation of data obtainments systems even if you know that you'll have to update and improve them over time. The main reason it's not acceptable is that you're wasting valuable data. Data is food for your business knowledge - without it, you can't have a lot of business intelligence. If you're interacting with leads, potential customers, or actual customers, you are capable of immediate obtaining at least some data. This data can be used relatively quickly (once you've gathered enough) provide you and your business with some insights. You can always improve the entire process later, but the data you gather today (as long as it meets the 3 criteria above) will be able to still be used in the future. For example, if you only gather emails and zip codes today but implement a much better data gathering process in the future that includes addresses, customer acquisition methods, and transactions, you can still use the data you have - you can use it now and you can use it to add to your larger/better future data. In essence, this is not something you have to get right on the first try - an iterative approach that adds and builds works very well as long as you make sure to follow the general guidelines we discussed above.
And now, given the rise of cyrptocurrencies and crypto assets to quasi-mainstream financial assets, we're dedicated to providing quality, relevant, and interesting material on cryptocurrencies and cryptoassets. Articles on Bitcoin, Ethereum, Ripple, Cardano, and many more cryptocurrencies and cryptoassets can be found on Pennies and Pounds - all that in addition to a plethora of information on what cryptoassets are, how the entire crypto industry came to be, blockchain/immutable ledge technology, mining, proof of work, proof of stake, and how to prudently invest in crypto if you are so inclined (based on your risk tolerance and ability to withstand the volatility that will come with a crypto portfolio).