What Businesses Should Know About Collecting Customer Data

Featured article by Susan Melony, Independent Technology Author

Collecting data is something almost every business does at this point. While it’s common to ask for various customer data from email addresses to traditional addresses, that doesn’t mean every business is doing things the right way.

Because of how frequently businesses collect data, it’s easy to start getting lax in the process of doing so. When that happens, a business may be putting their customer’s data and their reputation at risk.

The following are some general thing every business should know if they’re collecting customer data of any kind.

Compliance

“Failing to comply tells customers that they can’t trust you to keep their data secure,” says compliance software company Reciprocity. It’s true—when a business isn’t willing to go above and beyond to make sure data is secure, and they’re compliant, it’s a red flag to customers.

It’s important for businesses to be proactive with compliance. Businesses need the tools and technology to know where potential problems could exist before they actually become problems.

Why Are You Collecting Data?

Along with compliance, it’s key only to gather data that’s needed and is going to be useful to your business. Don’t gather it just for the sake of doing it. This leaves your customers and your business open to more risk. It can also be a turnoff to customers if they feel like they have to hand over every detail of themselves to do business with you.

You want to collect the information that will allow you to build relationships with customers, but you don’t want to to go overboard. Think about the information that will allow you to maximize relationships, sales and customer loyalty.

Start with the most straightforward information first, and then you might expand it from there once your relationship with a potential customer grows.

How to Collect Data

There are a number of ways to collect customer data. One of the easiest ways is through orders, and this feels the least intrusive to most customers. However, if you’re collecting data through orders, you aren’t getting information before a prospect actually makes a purchase, which is something to consider.

Another option is to use surveys or competitions. In these cases, make sure you’re transparent with the fact that you’re collecting data on targeted customers.

Storing Data

When you first start out, you may be fine with storing your customer data in a spreadsheet, however as the details of the data grow, your storage techniques will need to do the same.

You’ll need software that is going to allow you not just to store your data but also strategically put it to use.

Finally, there are laws that surround how data is collected and stored, and these need to be something you’re well aware of. This goes back to the concept of compliance, and the importance of this can’t be overstated.

You need to make sure you’re providing customers with options when it comes to the data they’re providing, and you want to allow them to opt-out when they choose.

…………