Understanding the cost of bad data on your business and how you can ensure customer information is accurate, relevant, and comprehensive.
For many franchise dealers, a dealership management system is at the core of your business. It touches all areas of operations and serves as the center of your business technology ecosystem. That’s why your DMS should be the system of record where employees can trust that the data is accurate and up to date. But that’s not always the case. Here’s why dealerships experience bad data, how it impacts your business and what you can do about it.
The cost of inaccurate, incomplete, non-conforming, or duplicate data is high. According to Gartner’s research, organizations lose $10-14 million every year due to bad data. The study also reveals that the typical cost of one record is $1; the average resolution cost is $10 per record, and the cost of correcting bad data is $100 per record. CIO.com research showed that about 80% of companies believe they lost revenue due to data challenges. Pragmatic Works research identified bad data causes 20-30% of operating expenses.
In addition to operating costs, employee productivity and customer satisfaction issues can arise from poor data. Your salesperson may lose time pursuing phantom prospects because of duplicate or redundant accounts. Your marketing and advertising efforts may be misdirected and costly when targeting the wrong customers. Your service advisors may provide inaccurate follow-up diagnoses during subsequent maintenance visits due to incomplete information. Your staff may have to keep asking customers for basic information that they’ve already provided time and time again. All of these consequences negatively impact the customer experience by creating frustration and reducing trust.
As with any database, duplicate records are inevitable. There are several reasons why this can occur.
The good news is that there are ways you can ensure data integrity and maintain it as your dealership continues to grow. Here are some best practices to implement at your dealership.
Clean, accurate data contributes to your dealership’s profitability. It can provide you with a clear view of your customer base, so you can better understand their needs and personalize services to improve satisfaction and retention. It also enables more efficient business operations, so your employees are more focused on their job and spend less time chasing phantom prospects.
With the proper process and technology on your side to drive better data integrity, you can achieve greater productivity and efficiency. Schedule a demo today to learn how VUE DMS can help you make that next step and take back control of your dealership.