5 ways Data Insights benefit the Travel Industry
Travelling has become a daily activity for many people, as arriving from point A to point B is easier than ever. Moreover, no matter if going on a journey for leisure or business, the travelers continuously boost the growth and the evolvement of the industry, by setting new trends and tendencies in the way how traveling is organized and managed. As a result, transport systems are enhanced, the world “becomes smaller,” as borders are removed, and the processes for going from one country to another have become less complicated due to the simplified formal procedures.
However, to ensure the continuous profits and organizational success, the businesses operating in the travel industry have to keep up with this changing environment. So exactly data analytics is the key solution that tackles this issue.
By collecting, analyzing, and interpreting data, travel companies gain useful and valuable data insights and convert them into a functional action plan in order to stimulate their business growth and to establish their name on the market.
But in what key business aspects do those data insights help the travel companies? Let's have a detailed look:
Customer Experience (CX)
Customer experience is in the core of the successful business operations, because, after all, satisfied clients push the business forward. The happy customers are the ones that “naturally” expand our client base when they tell their friends and family about the satisfying experience they had with our product, service, or with the company as a whole.
90% of travelers worldwide admit that standard traveling process is not enough any longer. That is why services personalization is a key feature of the business success in 2019.
Travel companies can recognize tendencies in the personal preferences of their clients, based on valuable data insights. This way, the organizations obtain the business opportunity to customize their services to the tailored needs and desires of the travelers. Moreover, the services can be personalized according to the specific stage in the customer journey, which has the potential to convert the clients into loyal customers and retain their satisfaction.
For example, airline businesses can provide customized flight booking experience, based on previous bookings and searches. They can quickly recognize the preferences of the client, such as if he travels for business or leisure if he prefers VIP or economy zone, if he carries checked-in luggage or only hand luggage, what is his approximate budget, etc. Based on these optimized data, the company can provide tailored offers, exclusive discounts, and other benefits.
And when customers feel like they are being taken care of, the level of CX rises tremendously, together with company growth and success.
What happens if we want to reach new clients and expand our customer base? We undertake a strong marketing campaign to make our target group aware of the services that we provide and convince them to become our clients.
This seems easy, but it is a very complex process, where you have to know your target audience exceptionally well, in order to approach it in a proper way. Valuable data insights help the organizations to identify the needs and desires of the different prospect segments and align the marketing strategy accordingly, in order to enhance its impact.
To continue with the example from the previous section, airline companies can boost and upgrade their marketing campaigns, based on proper analytics and data interpretation. By being aware of the target groups characteristics, their buying motives, preferred channels, and specific desires, businesses can use social media or other digital platforms to create personalized messages with special flight booking offers, or discounts, reaching new clients. This way, high-quality data analysis will enable the organizations to market the right services to the right people, at the right time, through the right promotional channel, and at the right price, ensuring that those five marketing pillars are perfectly aligned.
Competitors “health check”
As the travel industry is growing with a quick pace, the competition is also increasing, due to the valuable profit opportunities, which private companies see in this vertical. But in such a competitive environment, it is essential to know what the rivals are doing, as well as when, where, how, and why they are doing it.
Preparing a competitors health check analysis, regarding quality, features and success of services, target groups, promotional channels, prices, presence in digital platforms, and customer reviews, provides data-based insights, which help the travel companies to keep up with the trends and do not lose competitive advantage, nor market share.
Airline businesses can benefit from those insights, as they can convert them into an actionable plan to adopt new product or service offerings, flight policies, or pricing strategies. On the other hand, those companies can take the lead and come up with a new upgraded product or service. For example, providing free food to clients who have paid for a checked-in suitcase, or maybe accumulating travel credit based on the number of kilometers traveled with the airline (and then converting the credit into discounts and gifts).
Of course, the organizational differentiation is closely linked to the competitors' health check, because only when we know what the others are doing, we can focus on invention, innovation, or differentiation. In all the three cases, the focal point is not to follow, but to lead.
The above described “travel market leaders” often have a higher competitive advantage than their followers, as they are the first ones to adopt new practices, products, and services. Of course, this goes with a lot of risks, as the leading companies have to educate the customer segments about their new offerings. Yet, there is not 100% chance that the customers will like and adapt to the services they are provided with. Especially if they are extremely innovative and cutting edge.
Fortunately, data insights come of help. By using the findings of specific data interpretation, the companies will be able to clearly identify any potential market gaps, as well as see what kinds of products the travelers are lacking, what they are “craving” for and what will enhance the quality of their journey.
For example, Booking.com sustainability travel report mentions that “over half (55%) of global travellers report being more determined to make sustainable travel choices than they were a year ago, but barriers include a lack of knowledge and available or appealing options when trying to put this into practice.”
By knowing this particular customer need and identifying the gap in the market offerings, travel companies can start differentiating by providing more sustainable products and services. Lets say, cutting down carbon emissions, waste volume or water consumption; adopting solar panel energy generators, or IoT network to monitor utility consumption.
By having useful insights on hand, the companies operating in the travel industry have the opportunity to benefit from data-driven and evidence-based decision-making process, risk analysis, and planning.
As a result, they can continuously enhance their knowledge about the customers, market trends, and competitors, together with their profit margin, ROI, and position in the industry. And on the other hand, they can lower energy consumption, variable costs, and carbon footprint.
Data analysis, and in particular, the insights, which this process provides, are crucial for the success of the travel business entities. They give answers to complex questions, such as:
- How to approach new clients?
- What our current customers want, and how to give it to them?
- What our competitors are doing and are we following them behind?
- How to differentiate from the other travel companies in the area?
Being able to tackle issues with evidence-driven solutions enhances the level of company governance, ensures better operations and more satisfied clients.