Why Data Processing Is Needed

Data Processing is a necessary step!

We live in a day and age where data rules everything around you, it is continuously growing, and it will never stop. Every important decision made in a business relies directly in the data that is provided and aggregated. That’s where Data Processing comes in. It is the ability to process the vast amount of data out there in its many different formats, standardize them and be able to provide a clean file back to analyze or even to deploy. The end goal is to turn junk data into pieces of gold for businesses to use. Many businesses believe they are saving money not cleaning their lists before a marketing deployment and this is where they learn to regret it.

Imagine sending a direct mail campaign and having 30% of those records come back as non-deliverable. The loss in costs and fees paid for the postcards and prints eat away at your potential profits in the marketing campaign.

Imagine this scenario with no Data Processing involved:

Bob wanted to deploy his own customer list of 100,000 records for a direct mail campaign but did not want to pay extra fees to get any Data Processing done. We’ll keep it simple by saying postage and print fees are a total of $.25 cents per record. There are other additional expenses when you start to pull multiple direct mail lists from different providers but that’s another story to tell! For now, let’s just stick with this simple example. The overall campaign equates to a total of $25,000 worth of expenses, but Bob gets a $20 per lead conversion and expects to get a 3% conversion/response. You can refer to the figure below:

Direct Mail, Data Processing Image 1

Direct Mail Campaign, Data Processing

How you lose in profits with no Data Processing

Let’s say the campaign does well and generates an 5% conversion rate on the campaign and generates nearly $100,000 worth of revenue. That puts Bob at a $75,000 worth of profit less the expenses! Look at Bob now, your modern-day marketing extraordinaire! However, right after the campaign dropped Bob started to receive 30% of the records back. These records were deemed as non-deliverable due to improper formatting of addresses, invalid addresses and missing zip codes. Not to mention, Bob realized that his list had 2,000 duplicate records in the file as well.  That’s $7,500 to non-deliverable and $500 to duplicate records lost in expenses, therefore dropping his $75,000 profits down to $67,000. The figure below depicts how avoiding Data Processing can drain your profits. Now Bob could have made the decision to clean the data first to avoid potential losses in profits by doing a bit of Data Processing.

Direct Mail, Data Processing Image 2

Direct Mail Campaign Breakdown , Data Processing

Like we said, Data Processing is a necessity when it comes to deploying your data for marketing efforts! This is only one of the many reasons why Data Processing is important. Others include aggregating multiple data sources for accurate marketing reports, pre-processing for predictive analysis, clean data to store in your databases, and much more! Moral of the story is…don’t be like Bob in this example. DO your due diligence and get some Data Processing done!

Dennis Tran
Director of Data Processing
Carney Direct Marketing