Big data in the travel industry: How can travel companies do more to collect and use customer data?
People leave lengthy trails of data when they travel. Purchases are made online, itineraries are stored in digital calendars, and GPS co-ordinates are shared every step of the way.
Data-based insights can improve every stage of the customer experience, from the first interaction through to loyalty initiatives.
However, collecting and connecting that data remains a challenge; turning it into profitable insights is more challenging still.
Travel businesses are aware of the importance of data analytics. According to The State of Data in Travel Survey 2017, 65% of travel businesses now have a dedicated data analysis team, with 75% of these businesses expecting to increase their data analytics budget this year.
And yet, there is a sense that we are still only scratching the surface of what might be possible for the online travel industry.
As it stands, much of the available data is unstructured and requires some wrangling before it can be used to shape decisions. The tasks of capturing, transforming, and interpreting this data requires collaboration between all teams, from CRM through to Analyticsand Search. Having a dedicated data team is a significant step in the right direction, but everyone has a role to play in a truly data-informed company culture.
This article will explore some common issues with data capture in the travel industry, before discussing some use cases for this data when it is captured and stored accurately.
One of the most significant obstacles to progress for the travel industry is the unreliable or incomplete nature of some data sets. This is true of many industries, but its ramifications are widespread and severe when applied to an industry that generates as much data as travel does.
This is a fiercely competitive industry where speed is always of the essence, but minimal advantages can reap great rewards. The key to unlocking those rewards in 2017 and beyond will be the use of reliable data to enhance customer experiences.
There are many reasons why a data set can be incomplete or inaccurate, however. Customer data is fragmented across numerous different systems, which can either be proprietary or off the shelf. Bringing this all together into one reliable data warehouse requires a lot of investment, particularly for larger companies which depend on legacy technologies for customer loyalty data, complaint logs, and flight operations.
This can lead to a fragmented ecosystem that looks as follows:
If we factor in the likelihood that a customer will book component parts of their itinerary with different providers, across different devices, at different times, the holy grail of attaining a unified customer view seems rather distant.
The use of a data management platform (DMP) to assimilate first- and third-party data sources can aid with this, but it can only be as effective as the data allows it to be. Marketers need to be capturing data effectively via their different channels to maximize the potential of a DMP. French national railway company SNCF deals with over 90 terabytes of customer data per month, but these are the quantities of data required to understand customers’ behavioral patterns.
If we look at the figure below, we can see that there are severe limitations to the quantity of data each team is gathering and using to shape the customer experience at the typical travel company:
This reveals how far the industry has to go, but progress is being made. Real digital transformation takes a long time to bring to fruition, and travel brands would do well to increase their uptake of these different avenues of data collection as a starting point.
The gaps in data capture are very clear, but before tackling the root causes it is also worth considering a development that will only increase the quantities of data at a travel marketer’s disposal.
In the figure above, 14.8% of senior travel marketers stated that they use Internet of Things devices to gain insight into customers.
