The Real (and Scary) Cost of Bad Data

Bad data can cost you money. It can also damage your reputation, drive good customers away, and negatively affect your entire workforce. Bad data, more often than not, results in bad decisions – and bad decisions can destroy a business.

The true costs of bad data are so overwhelming that they’re scary. If you don’t take data quality seriously, you’re at risk of being blindsided by the enormous impact of bad data.

Quick Takeaways

  • Bad data is often inaccurate, incomplete, conflicting, duplicate, and invalid 
  • Bad data can result in mistargeted marketing campaigns, unrealized revenues, damaged reputations, and unwanted (and expensive) downtime
  • Other consequences of bad data include lost productivity, costly noncompliance, and lack of data trust
  • Ultimately, bad data results in bad business decisions and missed opportunities

What is Bad Data?

Bad data is any data that is not wholly accurate or doesn’t conform to necessary standards. That can include inaccurate data, incomplete data, conflicting data, duplicate data, invalid data, and unsynchronized data. 

Types of bad data

The following table describes some of the most common types of bad data. 

Type of bad dataDescriptionExamples
Inaccurate dataData with incorrect valuesContact info with the wrong email address
Incomplete dataData with empty fieldsCustomer data missing key information, such as social security numbers
Conflicting dataSimilar records with different attributesTwo records for the same customer but with different addresses
Duplicate dataIdentical data from two or more different sourcesTwo records for the same customer from two different databases
Invalid dataData with nonstandard attributesA ZIP code with only four digits (instead of five)
Unsynchronized dataData not appropriately shared or updated between two different systemsCustomer address changes in one system but isn’t updated in another

Any of these qualities can result in data that is misleading at best and unusable at worst. If you rely on data to manage your business, bad data can cause you to make misinformed and ultimately ill-conceived decisions. 

What is the True Cost of Bad Data?

According to Gartner, bad data costs organizations $12.9 million a year. Advertisers waste 21% of their media budgets because of bad data. And bad data causes B2B marketers to target the wrong decision-makers almost 86% of the time

These financial costs are just the obvious consequences of bad data. Bad data can result in disengaged and disillusioned customers, damaged reputations, lost productivity, and missed opportunities. 

Taking all these factors into account, what is the true cost of bad data? There are many ways that bad data can negatively impact your business.

How bad data can impact your business.

Mistargeted Customers

Without accurate data, marketers can easily target the wrong customers with the wrong message in the wrong media. Higher-potential customers get overlooked while the company forces its message onto otherwise disinterested consumers. Whether marketers are annoying mistargeted consumers or ignoring customers who might be interested in buying what they’re selling, bad data results in wasted marketing spend and lower-than-expected revenues.

Lost Revenues

When bad data causes a company to target the wrong customers, lost revenues result. Lost revenues can also result from unexpected system downtime, another potential consequence of working with bad data. When bad data results in bad decision-making, sales aren’t as effective as they could otherwise be.

Damaged Reputations

Bad data can cause a company to act in ways that affect its reputation. Maybe it’s a marketing slip-up that puts the wrong product in front of the wrong consumers, or perhaps it’s a more strategic error based on unreliable data analysis. Whatever the actual circumstances, you don’t want to be cast as a company that makes decisions based on bad data. 

Unwanted Downtime

Another potential consequence of bad data is system and equipment downtime. Good data can help a company better predict when system or equipment maintenance is necessary and keep those machines and systems up and running. Bad operating data can cause a company to forego necessary maintenance, resulting in unexpected repairs and unwanted downtime. 

Lost Productivity

Not only does bad data affect physical operations, but it also affects the people who manage a company’s systems and machinery. A company’s employees can quickly become burned out and discouraged when continually forced to deal with errors caused by bad data. In addition, fixing unnecessary mistakes takes time away from more productive tasks. Bad data affects employee engagement and productivity. 


A company needs accurate and up-to-date data to ensure compliance with the many governmental regulations that impact numerous industries today. Bad data can cause a company to become noncompliant or to lack the audit trail necessary to prove compliance. Since noncompliance can be costly, this is a big issue for many companies, especially those in the healthcare and financial fields.

Lack of Data Trust

When a company can’t trust its data, it can’t trust the decisions it makes. Unreliable data results in uninformed decision-making and overly cautious management. In a world that operates at light speed, a lack of data trust can cause a company to be outpaced by competitors relying on more trustworthy data. 

Bad Decisions

Even worse than being cautious about untrustworthy data is blindly believing data that looks good on the surface but ultimately turns out to be inaccurate. Bad data results in bad decisions, which can cripple a company’s ability to both manage daily operations and create long-term strategy. When it comes to making business decisions, relying on bad data is worse than having no data at all. 

Missed Opportunities

Bad decisions can cause a company to waste money blindly following the wrong prospects. Bad or misinterpreted data can cause a company to ignore high-potential opportunities and cede ground to better-informed competition. 

Minimize the Cost of Bad Data with DataBuck

When you want to minimize the cost of bad data, turn to FirstEigen’s DataBuck, a data quality monitoring solution that ensures your company is working with the highest-quality data possible. DataBuck uses machine learning and artificial intelligence to generate data quality rules in real time, identify and clean bad data, and provide the quality data you need to make the best possible business decisions. 

Automatically turn bad data into good data with DataBuck. Contact FirstEigen today to learn more.

Check out these articles on Data Trustability, Observability, and Data Quality.

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