A company’s invalid data goes far beyond dollars and cents in the retail space. Sales professionals waste time dealing with incorrect prospect data. Service delivery professionals waste time correcting flawed customer orders received from sales. IT spends enormous effort lining up systems that don’t sync and data workers spend a lot of wasted time cleaning data.
The reason invalid data cost so much for retailers is that it can get woven into some important decisions and potentially steer the organization down the wrong path—not only is this expensive but it can also slow down productivity and can have a lasting negative impact on employees.
We identify three major costs of bad data. Check them out.
1. Bad data equals financial loss
Insufficient data has a monetary impact to businesses. Bad decisions made from inaccurate data are not only inconvenient but also extremely costly. Let’s take return mail as an example. Undeliverable mail is costly to both the U.S. Postal Service and its customers. According to the USPS® report in 2021, the USPS reflected in 2021 USPS spent about $1.4 million on undeliverable mail USPS itself must spend money to process that mail, that’s only a fraction of the wasted costs of postage and collateral from the businesses that sent the mail in the first place.1
2. A hit to productivity
Invalid data goes far beyond monetary impact. We find that productivity is a cost of bad data. When a business is operating off invalid data, manually checking for data errors and correcting become an extra step within one’s daily responsibilities.
For example: We have two departments (A)fulfillment who handles customer information and packaging and (B)delivery who handles distribution. The delivery department, in addition to doing its own logistics work, must add steps to fix errors created by the fulfillment team such as invalid address labels. Though the delivery team corrects most errors manually, some issues still leak through which affects the customer. This causes the delivery department to take additional hits to its daily productivity by dealing with the consequences of those leaked errors, which may include angry customers, packages sent to the wrong address, and requests for lower invoices.
3. Unsatisfied employees
Not only does poor data cost businesses money, but it slows down the whole organization. All employees are affected by it, leading to reduced productivity. The applications and tools you provide to ensure they can do their jobs effectively are all dependent on the availability of useful, trustworthy data. If invalid data slows employees down, they feel their performance is suffering, they feel less job security, and their confidence along with their efficiency takes a hit.
How can Experian help improve data quality?
We have contact data validation solutions that connect your data across multiple channels and systems to eliminate duplicate entries to receive the most accurate up-to-date data.
Investing in data governance best practices—with help from enabling software, such as data quality, master data management, and data masking, among others—can help save you money, make money, reduce the risk of regulatory fines, and beyond.
1 Undeliverable-as-Addressed (UAA) Mail Roll-Up 1998-2021. USPS. February 29th, 2022.
