Big data and how it will have a massive impact on the travel industry – yup, we’ve been hearing an awful lot about that over the course of the past 18 months or so.
But last week’s Smart Analytics Conference, hosted by EyeForTravel in New York City, was a rare insight under the hood of travel marketing.
Instead of the high level, big picture, often aspirational images we see from travel marketers at the major conferences, we heard from the managers, directors, and VPs of data and analytics about what they are actually doing.
The result was part-pessimistic confirmation and part-pleasant surprise. There are still have and have nots when it comes to data-driven marketing. But the haves continue to move fast and innovatively. The have nots continue to stumble.
Indeed, the gap appears to be growing, not closing, and it’s clear the hotel brands are leading the pack.
Winners (and therefore there will be losers)
For those making progress, it was a story of fast-paced optimization of overall ad spend, customer relationship management, and loyalty marketing.
Brands such as Diamond Resorts International and Choice Hotels told of impressive resources, initiatives, and, if you dare believe it, tangible results.
Some travel companies are now sporting teams of five or 15 people devoted 100% to supporting data and analytics across their organizations.
They have torn down the siloes that have stymied this functionality for so long and reaped the benefits. Presenters discussed Orbitz’s 2012 Mac versus PC browser targeting debacle as a warning, yet were not overly sympathetic.
It’s clear most people appreciate data as a human challenge as much as a technical one. Giving too little credence to one over the other is a rookie mistake. The one exception to the progress demonstrated is social media data.
The unstructured, inconsistent, and unreliable nature of that data makes it hard to implement effectively. Despite unanimous agreement of its potential power, few are harnessing it today. Look for that to be the next frontier of investment for many of these companies in 2013.
Desperate voices
For those still struggling, the call from the wild was palpable and desperate. We heard of naysayers and lack of dollars available keeping companies in the 20th century.
As William Beckler from Lastminute.com/Travelocity Europe said:
“Eventually the data will win.”
But that eventuality might spell doom for some competitors. Most startling was the relative absence in voice from the air part of the industry.
Chris Amenechi, former-VP of ecommerce and merchandising at United, offered a vision that could best be described as wishful thinking for airlines, still famous for sending generic emails to even its best customers.
The data silos and lack of investment will take their toll as others continue apace.
The writing is on the wall for anyone with any degree of responsibility of marketing travel. The haves and have nots will continue to separate, and proof will be in results, not keynotes at conferences.
Any travel brand has a vision for custom, targeted marketing and revenue management that harmonizes all data into a powerful tool. But some are beginning to execute masterfully while others are clearly struggling.
This year promises to further separate the winners from the losers, until this becomes a bigger topic of conversation from the CEO’s office as well.
NB:Â Burning rubber image via Shutterstock.
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About Evan Konwiser
Wow, that is interesting. Especially the comment on companies having larger teams devoted to data analysis.
We see an incredible amount of (unused) agency data pass through Agentivity, and would love to talk to travel companies who are investing in CRM but need transactional travel data accessed easily.
Personally I think it’s a huge opportunity for even the smallest agency – and relatively easy to achieve a very robust CRM solution with extracted GDS data alone.
Great insights. I’d also point out the while the hotel brands have some of the most limited access to customer data, they have the advantage of having started in the right place. Often they’re customers come from 3rd parties with very little information, but that’s not such a handicap because the Hotel brands know what questions they want to ask of the data, and have a plan for what to do with the answers they get.
Other participants may have more data access but are stuffing mostly not from technical challenges. data science is after all quickly becoming a commodity service. Instead they are struggling from starting at the beginning : “oh my, look at all of our data, let’s Warehouse it” instead of starting from the middle: How many x are doing y under condition set z? How does this vary with age or season? What are the most valuable customers we have? Etc.
So the role of Data Scientist is made that much more important if they know how to simply ask the right questions.
Great article and insights Evan.
Its funny to hear of MAJOR travel brands having “5 to 15″ people working on data analytics. I know of several consumer-facing tech companies in Atlanta that have ~50 employees and have THREE of them are working on data and analytics.
They are seeing enormous returns from a data-driven focus, and I suspect as travel brands see results they will continue to invest more in this area as well.
“The data silos and lack of investment will take their toll as others continue apace.” – so sad and so true Evan.
I hear of the plight of marketers in large organizations nothing short of jumping up and down to get information/data about their own customers from within their own “large” organization.
So as caution, I lean upon the words of a famous 1st officer (for lack of a better anecdote):
“An iceberg, sir. I put a hard a’starboard on the engines, full astern, but it was too close. I tried to port ’round it, but she hit.”
Well dearly beloved… I must say… this is rather predictable. The challenges of Big Data sound like stories we have heard and read for ages. What amazes me is the real lack of focus on solving the issues. Time and time again we see people taking only small steps to creating real solutions for information management.
Chaps we have almost limitless computing power. If you can build a super computer for a few thousand (See Raspberry Pi) then apply that to real requirements.
The comment on airlines is probably the most telling… bravo Evan. I love seeing the junk that is served up to me by airline websites. Little has fundamentally changed in 15 years of so called data driven marketing. its rather data driven drivel.
But rather than poking at the fossils – let me suggest a different proposition. Start with the facts that data will always be dirty and incomplete. Forget about finding perfect answers. Try and look at the human aspects of data. I cannot accept that the data will always win because data by itself is useless. There is an inevitability about the progression: Data –> Information –> knowledge. Sadly I still see people forgetting the reasons why we look at data in the first place. What we need are good tools to deal with unstructured data and better engines to find relationships inside the data. We must move from passive and human driven reviews of the data to trusting systems that can bring us valuable information from the data we already have both INSIDE the house and from the web.
Airlines have more data than just about any sector. Yet they constantly waste it, abuse it, misinterpret it and then ultimately ignore it.
However this cannot go on forever. We are starting to see new tools like (despite its checkered history) Autonomy and Dexter Intelligence. What we need are better mind sets WORKING with the information to derive real value and knowledge.
Oh yes and a little side note… SHARING DATA is good, and to my mind essential. The Travel industry is awash is poor quality information derived from what I can only describe as a suspect practices of mixing scant data and opinion. Our industry needs to be better instrumented and that requires cooperation. If we don’t then we will continue to get the poor quality crap we currently have with bad decisions driven by poor data and questionable analysis.
Just think about it.
Cheers
Evan – Terrific and thanks for sharing! Boils down to the proper, relevant, timely and actionable outcomes from superior analysis…that’s what’s missing…among the airlines and travel supply chain.
I believe that starting small with big data technologies can give an impact to the revenue. Stay focus on practical solutions that can be measured easily.