Is the future of travel and hospitality data-driven?

The pressure is on European hospitality and travel brands to meet the evolving demands of their customers. In an era where tech giants like Netflix and Amazon have set the bar high for personalised recommendations and experiences, traveller satisfaction is becoming increasingly dependent on a brand’s ability to provide a personalised experience — from the time they start researching a trip until the time they leave a review. 

Yet, despite the value of getting personalisation right, many European travel and hospitality brands continue to struggle to leverage a robust, data-driven strategy. 

Lost in the check-in shuffle: Finding order in the chaos of travel data

The good news is, travel and hospitality brands have more customer data than ever before. And since a majority of travellers are willing to share their personal data in return for personalised services, there is no better time than now for brands to build their suite of first-party data. Doing so will help as they prepare for an increasingly complex world of privacy regulations and diminishing third-party cookies. 

But this also highlights the data challenge. Managing customer data is not a new problem. Many travel and hospitality brands have been trying to piece data together long before the pandemic. But without common linking keys to connect data points from multiple sources, they struggle to get a clear view of their customers or personalise services and experiences. 

For brands and companies that were struggling before, this deluge of new data is simply pushing them further into the data abyss. Let’s take a closer look at the hurdles these travel and hospitality brands are facing in the name of understanding their customer data:

  • Messy Booking Data: The abundance of data collected by online travel agencies (OTAs), hotels, airlines and car rental services to name a few, poses a significant challenge. Connecting the dots and identifying the ownership of this data is a daunting task. As a result, personalisation often falls by the wayside, hindering the ability to understand and cater to individual preferences.
  • Fractured Identities: Customers share inconsistent and diverse identifiers (like emails, phone numbers, zip codes and usernames) as they interact with brands from different channels, touchpoints and devices. The more a customer interacts, the more fragmented that identity becomes. 

Systems that aren’t equipped with the right intelligence will fail to identify the fact that Business Traveler Joe and Vacation Joe are the same person with different loyalty accounts. Without an accurate, single view of the customer, brands run into downstream problems like poor personalisation and inaccurate insights.

  • Siloed Data: Personalisation must be a holistic experience throughout the entire customer journey from online booking to customer service. However, the siloed nature of data and the lack of trust in its accuracy make it challenging to provide seamless personalisation at each touchpoint. Bridging these gaps requires a comprehensive understanding of the customer journey and the ability to infuse employee data, feedback and surveys into the personalisation process.
  • Legacy Tools: Data Management Platforms (DMPs) are declining in effectiveness and efficacy. But the DMPs’ diminishing usefulness is not so much a problem with the technology itself; rather, it’s a reflection of the changing landscape where DMPs operate. 

DMPs began as an essential tool for marketers to help them gain insights into unknown audiences, which they can still do well. The problem is the rise of privacy concerns, changes in data regulations and original equipment manufacturers (OEM) lockdowns have made available audiences and insights much more challenging to find. And when these limitations impact functionality to the point that they’re no longer effective, brands naturally turn to other solutions like Customer Data Platforms (CDPs). CDPs use first-party data to create a single source of customer truth to fuel data strategies and are emerging as the solution that makes the most sense in the new data environment.

Data SOS: An urgent need for data intelligence

In today’s fast-paced digital landscape where customer loyalty is up for grabs, travel and hospitality brands don’t have the luxury of time to deal with legacy issues. They need fast, powerful and flexible Customer Data Platforms (CDPs) that can transform their end-to-end data management process in three major ways:

  1. Fast and powerful identity resolution 
  2. Real-time access to 360-degree customer profiles
  3. Data intelligence and campaign orchestration

Identity resolution is a crucial step in using customer data. All the other elements of personalising marketing and service depend on first having a clear, coherent record for each customer.  

The following three key factors set an intelligent identity solution apart from the rest:

1. Complete data collection: Powerful identity platforms have the ability to ingest customer data in their raw, native formats; regardless of where they come from. This eliminates the problem of data silos and the unnecessary need for reformatting and conversion, allowing brands to preserve the richness of their data right from the source.

2. Flexible probabilistic identity resolution: Probabilistic identity resolution harnesses AI-powered algorithms to establish identity matches by making intelligent judgments and drawing probable links between seemingly unrelated data sets and identifiers just like a human would.

Unlike traditional rules-based or deterministic approaches (i.e. based on exact matches) that tend to be rigid and limiting, probabilistic platforms allow brands to resolve identities at a much larger scale with the flexibility to update and adapt each time new data enters the system.

3. Massive computing power: Petabytes of data come through identity systems each day. Platforms must be built on a robust infrastructure, so brands can have the freedom to scale up or down, according to their business needs.

Getting onboard with personalisation: The future of travel and hospitality

By investing in robust data management systems, leveraging employee data and prioritising guest experience improvement, European travel and hospitality brands can make significant strides towards achieving true personalisation. Embracing the power of personalisation enables brands to create memorable travel experiences that leave a lasting impact on their customers, ultimately driving success in the evolving travel industry.

Four data-driven strategies for travel and hospitality brands

  1. React fast to intent signals: Travellers are taking less time between starting to plan a trip and making bookings. As soon as a brand picks up an indication that someone is shopping, targeted marketing should begin immediately. Understanding the customer at the speed of a business is really hard right now. It’s taking brands weeks at a time to ask a very narrow set of questions of their data because of the way that it’s either organised  (or not) or the way it’s integrated (or not).
  2. Reach beyond loyalty members: With many travellers rethinking their preferences after the pandemic, brands need to earn loyalty again. Many travellers don’t want to be locked into a single provider. That means travel and hospitality brands must combine data from loyalty programs with other sources to better understand each customer, effectively repositioning ‘loyalty’ around the person instead of the program. By targeting customers that have the greatest potential value – in the moment and over a lifetime, regardless of ‘status’ – brands can start to formulate a clearer foundation for their customer data and personalisation strategies.
  3. Drive personalisation to every customer touchpoint: Initial uses of customer data were largely for marketing. There is a huge opportunity to use the same information to customise experiences for travellers throughout their journeys. According to McKinsey, travellers now need more, not less, assistance. The next frontier of measurement is knowing what your customers want and need without asking.
  4. Build out first-party data collection: Expanding privacy restrictions are making it harder to use data provided by third parties. Yet, travel executives say a majority of their customer data is coming from online travel agencies, social networks and other intermediaries. Research indicates that more than 55 per cent admit that at least half of their customer data comes from third-party sources. Even more, nearly one-quarter obtained at least 75 percent of their data from third parties. The onus is on brands to switch these practices and build out their first-party data collection. And remember, when customers give you their data, it’s a gift. So don’t throw it away. Instead, take it beyond the trip and create a customer profile.

Paving the path to unforgettable travel and hospitality experiences

By embracing the power of data, brands can transcend the limitations of today’s challenges and create a future where every traveller feels understood, valued and inspired by their experiences.

The journey begins with a commitment to data-driven strategies and an unwavering dedication to delivering remarkable moments that leave an indelible mark on the hearts of travellers. After all, getting better at using guest experience data isn’t just to selfishly boost a brand’s bottom line — it’s a genuine endeavour to elevate the entire guest experience.

(Photo by Ross Parmly on Unsplash)

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