Back to Basics: What is Data Collection?
In today’s digital world, data is power. It is the driving force behind how we learn about consumers, make decisions, and deliver results. In short, data has the power to improve virtually every aspect of your business. But data alone isn’t enough. You must be able to efficiently gather and act upon data in the right context. And it all starts with establishing an effective data collection system.
In this post, we’ll define data collection, why it is important for your business, common challenges, best practices, and the benefits for your organization.
What is data collection?
Data collection is the process of gathering data from specific sources to understand a topic better. Across industries, these processes vary widely. It can involve data gathering through surveys or focus groups, observational research in the field, or tracking website traffic and social media. The three types of consumer data you can collect include:
- First-party data: Collected directly from customers and prospects
- Second-party data: Shared by a secondary organization
- Third-party data: Sold by an organization not connected to yours
In the world of business, we collect data mainly from customers and prospects. We use this data in research, analysis, planning, decision-making, predictions, and more. Data collection also happens internally to help day-to-day operations run smoothly.
Five common data collection methods
Data can be collected in many different ways and across several mediums. The method your organization uses will generally depend on your industry and objectives. Let’s look at some of the common methods of business data collection below.
Method #1: Surveys and polls
Surveys and polls are online questionnaires that customers can complete to provide feedback for an organization. Commonly, these questionnaires help an organization with customer support, product development, marketing, or general business research.
Method #2: SEO tracking
Search engine optimization (SEO) tools help organizations gather metrics to help with website ranking and analytics. SEO tools provide valuable data an organization can use to improve visitor traffic, rank above the competition, and enhance digital marketing strategies.
Method #3: Focus groups
Focus groups provide specific information about individuals’ opinions on a topic of interest. Organizations can use these perspectives to gain insights into new product developments. Focus groups also allow organizations to receive feedback on the quality of service, support, or other more nuanced aspects of a business.
Method #4: Website monitoring
Monitoring visitor data on an organization’s website offers many insights about customers and prospects. These insights can include behavior patterns, basic visitor demographics, search keywords, visitor activity and engagement with content, and more.
Method #5: Online forms
Online forms provide an effective and simple way to gather qualitative data from users. Specifically, an organization can collect contact and other demographic information. Virtually all departments can use this data to reach prospects, improve marketing, gather feedback, and more.
Why is data collection important?
Data collection generally occurs at multiple levels and for various purposes within an organization. A customer support team may collect feedback data to learn more about a customer’s experience. A marketing team may use customer data to create targeted campaigns. A sales team may use prospect data to personalize a demo experience.
Without data, or by using poor data collection methods, your organization will struggle to be effective, stay productive, and operate efficiently. This all ultimately affects the bottom line and the ability to maximize profits. Avoiding the following challenges can help ensure your organization maximizes the effectiveness of the data you collect.
Common data collection challenges
Organizations face several challenges when collecting data. To overcome these challenges, your organization must first start by identifying the roadblocks that make collecting data difficult. From here, your organization can work toward developing high-quality data collection processes.
Data collected can be inaccurate, incomplete, duplicate, or inconsistent. Similarly, it may be irrelevant if an organization does not know the purpose of the data being collected. Data collected will generally need to undergo a data cleaning process to maintain its usability.
Collecting data without standardization can lead to data quality issues. Without standards for capitalization, abbreviations, or spellings, data will become inconsistent or inaccurate. Creating a standardized data collection process across an organization will help improve data quality.
Manual data entry processes are both a waste of time and increase the risk of error. Paper forms and spreadsheets are disorganized and not scalable, holding your organization back. Proper data collection software saves time, costs, and errors common with manual processes.
Lack of training
Employees who do not receive proper training in how and why to collect data can impact your efforts. Without an understanding, an employee may not know to ask for certain information or understand what data is necessary. Implementing a data collection training program can avoid these nuances and assumptions.
No routine audits
Data is always evolving and will naturally deteriorate over time. If no auditing exists, it will be difficult to know which data is accurate and which is outdated or incorrect. Routine data audits ensure the information being collected and stored maintains quality over time.
Data collection best practices
Securely collecting and managing data is the responsibility of everyone in your organization. Whether or not your organization needs sensitive information (such as social security numbers or medical health records), data should always be collected responsibly. Follow these best practices to keep your data collection practices ethical and trustworthy:
- Collect only the data you need. Gather just enough data to maintain business processes and goals, and no more. Know how long you need to retain the data for its purposes and purge when necessary. Less data stored for less time reduces the risk and potential harm of a data breach.
- Maintain standards for data quality. Set data quality guidelines and processes to help maintain data accuracy. This can involve appointing a data steward to keep databases up-to-date and error free. Maintaining data quality includes routine data cleaning as well.
- Comply with data laws and regulations. Know and understand the data privacy regulations that pertain to your organization, industry, and customer base. Maintaining security and compliance standards with these processes helps to avoid data breaches and can help increase customer trust.
- Be transparent about your processes. Consumers have a right to know how and why organizations collect their data as well as opt in or out. It is the responsibility of an organization to maintain transparency about these processes and any plans for storing or selling the data.
- Follow data governance practices. Set up data governance policies and data stewardship processes to help govern the entire data lifecycle. These establish guidelines for ethically collecting, managing, and using data as well as who is authorized to access certain types of data.
- Make data security a priority. To avoid the penalties of data breaches, implement data cybersecurity policies across an entire organization. This should include data backups, data encryption, installing firewalls, training programs, incident reports, and data breach response plans.
- Keep employees on the same page. Make sure all employees involved with data understand the purpose of collecting data, standard data collection methods, and their role in data stewardship. This knowledge along with other security best practices can help reduce the risk of data incidents caused by an employee.
The main benefits of data collection
Regardless of your organization or industry, data collection has several key benefits for your business strategy and revenue goals. When collected efficiently and ethically, every department at your organization can use data to its full advantage. Here are the most common benefits of data collection:
- In-depth understanding of your consumer’s interests, desires, and needs
- Greater personalization across marketing campaigns and sales strategies
- Improve employee productivity and minimize wasted time and effort
- Maintain more personalized and engaging customer experiences
- Increase cross-departmental collaboration and communication
- Save on costs related to violations or efforts using bad data
- Improve decision-making and goal-setting for stakeholders
Jumpstart more effective data collection
Does your organization need a better way to collect data or improve efficiency? Download our checklist below to learn what questions you should be asking about your data collection processes. To continue learning with our Back to Basics series, be sure to check out our data stewardship blog.