Avoiding Errors: 5 Ways to Avoid Client Data Mistakes

Mishandling customer data is all it takes to ruin the reputation of any otherwise exceptional company. Without customer confidence, your ability to generate revenue is severely reduced. Learning which areas to focus on can help to avoid mistakes that might be costly for both you and the client. The following are some important business aspects you should manage well to retain your customers over the long term.

1. Digital Security

Weak online security can lead to data breaches and identity theft that have even longstanding customers leaving in droves. Protecting your company network with security software is critical. All desktops, servers, and mobile devices should have antivirus and antimalware installed. All security applications should be updated promptly as new versions or upgrades are released. Use encryption or a virtual private network (VPN) for more secure customer communications. It's also important to educate employees on good practices such as strong passwords, phishing scams, and avoiding unauthorized applications.

2. Clear Communication

You should keep customer information to a minimum. Don't save any data you aren't going to use. There are times it is necessary to get sensitive information for financial purposes or user authentication. Payment methods and verification, credit checks, and shipping information all involve data that hackers can use to perpetrate identity theft. Define and publish a privacy policy regarding customer information. You should be clear and transparent about what information you're collecting, why, how it's used, and how it will be stored. This way, the customer can weigh the risk for themselves without any surprises.

3. COI Tracking

A certificate of insurance, or COI, is a document used to verify that insurance coverage is in effect. Certain policies and coverage limits are often required of business agreements with contractors or supplies to minimize financial risks. Policies expire, and typically new certificates must be requested from the insurer. Your company needs a quick and easy way of tracking these COIs and confirming coverage, effective dates, and policy numbers. This is particularly important if you have a number of such contracts in effect. Fortunately, there are services that specialize in tracking and verifying certificates so that they conform to your policies and timelines. However, ensuring insurance information is protected is also an important concern; failure to do so could jeopardize important business relationships and disappoint customers.

4. Good Relationships

Trust and transparency are essential to customer confidence. It's necessary to build and sustain trustworthy practices to retain the good will of your customers. Some businesses make a point of promising confidentiality in their policies, then turn around and sell or trade customer information to marketers or other companies. Some will start spamming their customers whether they receive permission or not. If you aren't upfront about these practices, it's essentially a betrayal that's worse for your reputation than an actual data breach.

5. Customer Service

Good customer service is important to preserving customer relationships, but bad customer service processes can also expose client data. If your business employs software such as customer relationship management (CRM) or similar client data systems, they must be as completely secured as your other systems and the information never duplicated to unprotected applications. No customer data should be given out over the phone, chat, email, or any other channel until the customer's identity has been confirmed by at least two-fold authentication. Use methods such as asking for both the last four digits of their credit card and a user PIN or account number.

Some parties have mandatory requirements governing customer data, such as PCI guidelines and federal and state regulations. If you aren't in compliance with these standards, you could lose not just customer revenue, but pay fines or even lose your business.

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