One of the fastest-growing areas in business today is the cost of compliance with an expanding range of regulations designed to shield consumers from the unwanted or unfair use of their personal data by businesses. Between 2011 and 2018, these costs jumped over 40% to an average of US $5.47 million per organization, and nearly triple that for firms that fail to comply. Nowadays, some of the world’s most recognizable firms have been caught up in fines reaching hundreds of millions of dollars.
In this article, we will look at the scope of these emerging regulations, and how Customer Data Validation – an integrated approach to data quality from Service Objects – can help mitigate these risks.
Understanding compliance
As personal consumer data such as phone and email contact information has become increasingly available to businesses, customers found themselves subjected to a growing flood of marketing information that took up their time and clogged their inboxes. The reasons for this ranged from the sheer growth of online and telephone marketing to bad actors such as fraudsters and spammers. Ultimately, customer complaints rose to the attention of state, federal, and global authorities.
Consequently, a series of data privacy and consumer protection regulations have been implemented in recent years, and their growth shows no signs of slowing down. These regulations impose increasingly stringent requirements on businesses to ensure compliance, thereby driving up costs and exposing them to greater liability.
Compliance issues can result from both omissions, such as failing to validate or revalidate customer data, and commissions, such as engaging in discriminatory practices. Here are some examples:
- Sending a marketing text to a previously validated landline number that has since been ported to a new owner’s cell phone, violates the Telephone Consumer Protection Act (TCPA) and can lead to penalties of up to $1500 per message.
- Emailing prospects without specific opt-in permission violates the US CAN-SPAM Act and risks blacklisting by entire organizations’ mail servers.
- Engaging in discriminatory lending or banking practices based on consumer demographic information, which contravenes regulations like the Fair Housing Act or Fair Lending Act.
- Failing to recognize that some of your clients have European addresses and may have implicitly opted in (by not unchecking a box on a previous order) rather than explicitly (by choosing to receive your marketing). This violates the European Union’s stringent General Data Protection Regulation (GDPR), which carries penalties of up to €20 million or 4% of annual turnover, whichever is higher.
Data quality issues often lie at the heart of today’s compliance issues, and bad or incomplete customer data can lead to compliance failures from even the most well-intentioned businesses. This has led to making data governance a major function within organizations today and grown the need for automated solutions to help ensure customer data quality and compliance.
Customer Data Validation and compliance
Customer Data Validation offers instant verification, correction and augmentation of customer contact details, providing a comprehensive and accurate customer picture. In less than a second, a customer’s Name, Address, Phone, Email and Device can be verified and corrected against hundreds of authoritative data sources. This 4-layered process also appends additional key customer details along with quality and confidence scores that can be used to make informed decisions. The four layers include fundamental integrity checks of basic component data, augmenting and enriching contacts with associated data, verifying cross-connects between data points, and providing quality signals to assess the overall accuracy and quality of a customer record. Some of Service Objects’ Customer Data Validation services include:
DOTS Address Validation – verifies, corrects and appends addresses, ensuring that customer data is accurate and up-to-date to meet compliance requirements.
DOTS Email Validation – ensures accurate and valid email addresses, helping achieve compliance with data protection regulations and preventing communication errors.
DOTS Address Insight – validates and corrects addresses, and appends geolocation and 140+ geocentric demographic data points to support compliance.
DOTS Reverse Phone Look-Up – provides both caller and carrier contact information, including porting, line and phone type details critical to compliance.
Customer Data Validation is designed to become an important part of your data quality and compliance framework. This framework allows you to define data standards, processes, and roles ensuring that customer data is collected, maintained, and used consistently across the organization and supports compliance.
Learn more from our free white paper
For all your compliance needs, Customer Data Validation can help ensure that your contact data is accurate, verified and complete. Want to learn more? Download our free white paper Customer Data Validation: When Accuracy Matters, or better yet, speak with our knowledgeable data quality team for a free consultation and product demos. We’re here to help you design compliance solutions that meet your unique business needs.
