You might want to be sure youโre sitting down for this: In 2016, the Harvard Business Review reported that poor-quality data cost US businesses $3.1 trillion annually. That was nearly 10 years ago. If anything, as the world has become more reliant on data and technology, that figure is likely much higher. Some estimates suggest poor-quality data can cost 15% to 25% of total revenue. Bottom line: data quality matters.
Hubspot estimates that email marketing databases degrade by up to 25% yearly. Roger Craver, author of Retention Fundraising, says nonprofits can expect about a 5% to 7% undeliverable rate in our databases.
Whatever the number, data goes badโit just does. People move, change email addresses, switch numbers, and have life events that affect how we contact them.
People arenโt always accurate, either. Data can be entered incorrectly (especially for those of us with older thumbs trying to do things on our phones), and sometimes, we donโt capture it right on the organizational sideโmany issues can affect data quality.
Data is an asset. In the connection economy we fundraise in today, the ability to contact and connect with someone has a direct impact on the quality of our relationship with them. The quality of the relationship has a direct impact on the money we raise and, ultimately, on the missions we serve.
What Do We Mean by Data Quality
Data quality refers to the condition of your data based on factors like accuracy, completeness, reliability, and relevance.
For nonprofits, data quality can affect:
- Accurate Donor Communication: High-quality data ensures that your messages reach the right people at the right time, increasing the likelihood of engagement and donations.
- Informed Decision-Making: Reliable data helps in making strategic decisions on fundraising potential and approach, as well as reporting on status and efficacy.
- Enhanced Donor Relationships: Clean data allows for personalized communication, fostering stronger relationships with your donors and communities.
- Efficiency: High-quality data reduces the time and effort spent identifying prospects, creating appeals and solicitations, and communications in general.
Common Data Quality Issues in Nonprofit Databases
Nonprofit databases often face several data quality challenges, including:
- Missing or Incorrect Names: Incorrectly spelled or missing names can lead to embarrassing communication errors.
- Incomplete Addresses and Phone Numbers: Missing contact information makes it difficult to reach donors through traditional mail or phone campaigns.
- Invalid Email Addresses: Incorrect or outdated email addresses can lead to high bounce rates and low email campaign effectiveness.
- Duplicate Records: Multiple records for the same donor can result in redundant communication and skewed data analytics.
- Outdated Information: Donor information that hasnโt been updated in years may no longer be accurate, leading to wasted efforts in outreach.
Steps to Improve Data Quality and Hygiene
1. Conduct a Data Audit
The first step in improving data quality is to understand the current state of your database. Conduct a thorough data audit to identify the types of issues present. Look for missing fields, incorrect entries, duplicates, and outdated information.
2. Standardize Data Entry
Establishing standardized data entry protocols is essential. Ensure that all team members and volunteers are trained to input data consistently and that data entryโand capture via online forms or other entry pointsโare standardized and reviewed regularly for accuracy.
3. Validate Your Data
Use automated validation tools to check the accuracy of data as itโs entered.
For example, email validation software can verify whether an email address is formatted correctly and exists. Address validation tools can ensure that addresses are complete and accurate. Phone appends can identify which records are mobile numbers vs. landlines.
Important note: Whenever youโre conducting an append or validation of data records, ensure that youโre following the appropriate laws and regulations on use of email addresses and mobile devices, such as the CAN-SPAM Act and the Telephone Consumer Protection Actโin certain cases these regulations do apply to nonprofit organizations.
4. Regularly Update Records
Make it a routine practice to update donor records. This could involve sending periodic emails requesting donors to verify and update their information. Additionally, integrating your database with National Change of Address (NCOA) services can help keep address information current.
5. De-duplicate Your Database
Duplicate records can lead to confusion and inefficiencies. Use de-duplication tools to identify and merge duplicate records. Regularly scheduled de-duplication processes can prevent this issue from becoming overwhelming.
6. Cleanse Data
Data cleansing involves correcting or removing inaccurate or irrelevant data. Focus on correcting misspelled names, updating outdated contact information, and removing inactive or irrelevant records.
If you feel you have a large amount of data that needs to be cleaned, work on โchunkingโ itโcreate small batches that can easily be tackled and clean 100 records per week or similar.
7. Maintain Data Consistency
Consistency is key to data quality. Use consistent formats for dates, addresses, and phone numbers.
For example, decide on a standard format for entering phone numbers (e.g., (123) 456-7890) and ensure everyone adheres to it.
Benefits of Clean Data
Investing in data hygiene offers numerous benefits for nonprofits:
- Improved Campaign Effectiveness: Clean data leads to more effective communication, ensuring your message reaches the right audience.
- Increased Donor Retention: Personalized and accurate communication helps build stronger relationships with donors, increasing retention rates.
- Enhanced Reporting and Analytics: Accurate data provides reliable insights, enabling better decision-making and strategy development.
- Cost Savings: Reducing the time and resources spent on correcting data issues can lead to significant cost savings.
- Better Compliance: Maintaining accurate and up-to-date records helps ensure compliance with data privacy and security regulations.
- Builds Trust and Affinity: Protecting the information donors entrust to us is a strong indicator to them that we are an organization they can believe in and support.
Maintaining high data quality and hygiene is not just a technical task but a strategic imperative for nonprofits. Clean data enhances every aspect of your fundraising efforts, from communication and engagement to reporting and compliance. By implementing the steps, you can ensure your donor database is a powerful tool for achieving your mission.
Remember, data quality is an ongoing process. Regular audits, updates, and standardization efforts are essential to keep your data in top shape. Invest in the right tools and technologies, and cultivate a culture of data accuracy within your organization. Your efforts will pay off through more effective fundraising campaigns, stronger donor relationships, and greater overall impact.
