Combine data and psychology to lift revenues

This is a viewpoint by Graham Cooke, CEO for Qubit.

Competition within the travel industry has never been so intense. It’s now impossible for brands to succeed in such a competitive landscape without a deep understanding of how their customers make their buying decisions, and the journey they go on to get there.

A lot of the travel industry is currently driven by cost. If you’re a brand that can’t compete on price, then how do you attract customers? How do you drive the loyalty needed to ensure business growth?

This is where being able to understand the intricacies of every customer is vital. Brands need to use data and psychology to get to know their customers and escape the race to the bottom.

Using heuristics to build brand loyalists

The mind is a ‘cognitive miser’; it likes to expend as little energy as possible on making a decision. It is an effective trait that helps us save energy when we need it, however, it does create biases and sometimes illogical behavioural shortcuts. These are called ‘heuristics’.

Understanding the approximations and assumptions in these decision-making processes can help brands understand how best to sell to their customers in all their illogical, confusing glory.

There are a wide variety of heuristics and cognitive biases that travel marketers should get to know. Below we highlight some of the main ones that can be applied easily:

  • The paradox of choice: decision-making becomes harder as the potential choices increase
  • Bandwagon effect: we are more likely to act when we can see that others are doing the same thing
  • Von Restorff effect: an item that differs from its peers is more likely to be remembered
  • Spacing effect: learning is greater when information is spread out over time, as opposed to being delivered in a single session
  • Confirmation bias: new evidence is taken as confirmation of an existing belief
  • Self-relevance effect: more information is processed when it is perceived as personally relevant

This last cognitive bias raises a crucial point in how vital customer understanding is in any business strategy. Without understanding who your customers are and how they engage with you, it is impossible to use the self-relevance effect (or any others) correctly, and efforts to turn them into brand loyalists are unlikely to succeed.

Centering on your customer has to be the guiding principle for each strategy implemented. By using heuristics, businesses can take account of visitors’ cognitive biases and enable them to make better decisions about the products and services offered. When applied correctly, Qubit has found that having effective personalisation in place can impact revenues by 6 percent; by adding a layer of heuristic process above this however this figure will significantly increase.

Airlines and hotel chains are embracing this new world of data-led personalisation. By placing reviews of flights or holidays, companies are using confirmation bias to encourage reticent buyers to purchase. Using alerts to show if a particular flight is running low on seats applies the bandwagon effect to encourage indecisive customers. And by using the spacing effect to not bombard a customer with all key offers in one go, deal information will be retained for longer and the negative effect of the paradox of choice will also be reduced.

For example, 93% of Thomas Cook travellers now either search for content online or express a preference for booking online. By using the power of social proof, and understanding the customer psyche, Thomas Cook has been able to increase urgency by surfacing experiences showcasing either popularity and/or scarcity, and as a result increase conversion. This has ultimately resulted in a 1.6% increase in purchases across the business.

Such genuine understanding of how customers think and feel will be key to making sure you serve up the right experiences. Our brains like taking the fastest route, but sometimes shortcuts can turn into dead ends. By understanding this, organisations can set customers on a journey that is most relevant for them and gain a competitive edge in the process.

This is a viewpoint by Graham Cooke, CEO for Qubit.

Opinions and views expressed by all guest contributors do not necessarily reflect those of tnooz, its writers, or its partners.

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About the Writer :: Viewpoints

A founding principle of tnooz was a diversity of viewpoints from across the spectrum. Viewpoints are articles by guest contributors from around the travel and hospitality industries. The views expressed are those of the author. and do not necessarily reflect those of the author's employer, or tnooz and its partners.



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  1. Terry Stewart

    Predictive analysis is what become the base of any marketing strategy, especially includes the customer behavior analysis and the neuromarketing. Thanks for the details, the article and topic itself is indeed very deep.

  2. Dorian Harris

    Interesting read.

    What do you imagine are the psychological effects of the high-pressure (book now or a kitten dies!) strategies employed by the big guns?


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