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Picture this: You spend thousands on a beautifully designed, glossy marketing campaign targeting previous customers. The mailers go out, the emails are sent, and then... crickets. Worse yet, you start getting angry phone calls from people demanding to be removed from your lists. Sound familiar?
If you're nodding your head, you're not alone. During a recent NADA webinar on data management, industry experts revealed just how much dirty data is silently draining dealership profits—and the numbers are staggering.
Let’s get into it.
The real cost of bad data
(hint: it’s more than you think)
"The other day got not one, not two, but three beautiful fold-out mailers, color, glossy, all the things, to trade in a car that I have not owned for over two years," shared April Simmons, Corporate Internet and Marketing Director at Horne Auto Group. "All three mail pieces showed up at my house on the same day. How much did that cost? And again, am I going to transact? No."
"The other day got… three fold-out mailers–color, glossy, all the
things–to trade in a car that I have not owned for over two years.”
- April Simmons, Horne Auto Group
This isn't just an isolated incident—it's happening at dealerships across the country, every single day. The money may as well be flushed down the drain. But the financial loss isn’t the only drawback, the fallout could result in potential customers being turned away forever.
Data decay by the numbers
Todd Smith, CEO of QoreAI, revealed some eye-opening statistics during the webinar that should make every dealer pay attention:
- Email addresses decay at 2.5% per month, meaning if you're not cleaning your CRM annually, 30% of your emails are bouncing
- 25% of phone numbers go bad every year—those "disconnected number" messages aren't just bad luck
- 10-14% of home addresses change annually—your direct mail might be reaching the wrong households
- 40%+ of customers in DMS systems no longer own their vehicles—yet they're still receiving service reminders and trade-in offers
40%+ of customers in DMS systems no longer own their vehicles
- Todd Smith, QoreAI
To really drive this point home, Todd shared a shocking example of a dealership group he worked with that supposedly "clean" data lake. It was later uncovered that it contained 33,000 deceased individuals. Imagine sending mailers out to those contacts or spending time calling or emailing. It’s not just a waste of time and money, but that could also potentially upset a lot of spouses and families.
The ripple effect:
When bad data gets worse
The problem compounds when you consider that automotive data is "snapshot data", capturing one moment in time that quickly becomes outdated. A sale transaction, a service visit, a lead inquiry—these are all point-in-time records that begin decaying immediately.
But here's where it gets really expensive: that bad data doesn't just sit there. It flows downstream to all your vendor partners, multiplying the waste across every marketing channel you use.
Michelle Phelps, Senior Director of Customer Success at Authenticom, explained the cascading effect:
When you think about the regulations and the liability and everything that is happening and not being able to actually track and understand who has your data, it's a huge risk - Michelle Phelps, Authenticom
The compliance nightmare
Beyond wasted marketing dollars, dirty data creates serious compliance risks.
April shared a common scenario that plays out weekly:
Customer to dealer: 'Hey, take me off your list.'
Salesman: 'Yeah, no problem, I got you.'
They go into the CRM, they opt the person out. But unfortunately, the OEM is still pulling some dirty data, so they pull out dirty data, and they now market to this customer."
The result? Angry customers who are potentially threatening lawsuits and risk of regulatory fines. With today's privacy laws and communication regulations, scattered data leaves dealerships vulnerable and exposed.
The death by a thousand cuts
What makes dirty data so insidious is that it rarely kills your business at once.
Instead, it's death by a thousand cuts:
- Marketing campaigns with lower response rates
- Increased customer acquisition costs
- Wasted staff time chasing bad leads
- Damaged brand reputation from irrelevant communications
- Legal exposure from compliance violations
- Missed opportunities with actual prospects
As April put it: "If you send out a ton of mailers and email and Facebook and all this stuff to somebody who is deceased, that person is not going to transact, which means you're lowering your performance. And conversely, it also goes a step further and makes it even worse because I get calls still, at least once a month from somebody who is so upset that they are still getting marketing materials from somebody who has passed away. Do you think that person's ever gonna do business with your company again? Absolutely not."
"I get calls still, at least once a month from somebody who is so upset that they are still getting marketing materials from somebody who has passed away." - April Simmons
The bottom line:
Clean data equals more profits
I know we’ve painted a gloomy picture, but I promise, there’s light at the end of the tunnel. This problem is completely solvable!
Dealerships that invest in proper data hygiene and management see immediate improvements in marketing performance, customer satisfaction, and compliance posture.
"Clean data equals more profits. It's that simple," the experts emphasized during the webinar. When you stop wasting money on bad addresses, disconnected phones, and people who no longer own their vehicles, you can redirect those marketing dollars toward actual prospects who are ready to buy.
"Clean data equals more profits. It's that simple."
Taking Action: Where to Start
The first step is acknowledging that if you haven't actively managed your data hygiene in the past year, you likely have a significant problem. The second step is understanding that this isn't something you can solve with spreadsheets and manual processes—you need the right tools and partners.
Modern data management solutions, like Record Recharge and DealerVault from Authenticom, can automatically identify and correct common data issues, validate contact information in real-time, and ensure your marketing dollars are being put to good use and reaching the right people at the right time.
The question isn't whether you can afford to invest in clean data—it's whether you can afford to wait. Every day you don’t, more money goes down the drain, and more potential customers slip away.
Your dealership's data is one of your most valuable assets. Let us help you start treating it that way. Book a time to chat with one of our team members.
