Targeting Customers Is No Longer Enough
By Harvey Chipkin Monday, Dec. 16, 2013
It’s not enough to target customers. Now you have to remarket to them. That’s the conclusion of a recent survey by Adara Global, which uses, yes, Big Data from travel and hospitality companies, to generate new revenue and cement customer relationships through marketing programs.
The report, called “Who’s Sleeping With You? A Detailed Look Into the U.S. Online Hotel Guest,” was done in conjunction with travel analyst Henry Harteveldt at Hudson Crossing, a consultancy, The results are daunting for hotel operators – already struggling with high marketing and distribution costs – which some estimate at 40% of revenues. That is a chilling level of expenditure.
Harteveldt said that newer customers are becoming more demographically fragmented and “most don’t belong to hotel loyalty programs.” The conclusion: hoteliers have to know their customers even better. And then they have to use that information to “remarket” to them – meaning it’s not enough just to rely on broader demographics. Among the report’s key findings:
The average age of a leisure guest is 42. The largest block of guests – 33% — is in Generation Y, aged 24-36. One in 11 is only 18-23. Boomers are beginning to see their dominance diminish.
Only 2 in 5 are loyal to a hotel brand Even loyalty program members shop around extensively before booking. Adara’s data show that elite loyalty program members average nine searches outside of the hotel chain they book. Other loyalty members average 11 searches.
Loyalty program members are 2.5 times as likely to take action if they see online ads about hotels that are relevant to their travel-related shopping and booking history.
Adding more customer data helps digital travel ads perform better. That includes geo-targeting and purchase history.
At around the same time, Expedia Media released a survey also demonstrating the wandering eye – or “content journey” of travel shoppers. Among those results:
26% of travel buyers were exposed to travel-related content on Facebook – 9% organic.
OTA’s are visited by 80% of travelers during the booking process, and the average number of OTA visits for hotels purchase exceeds any other category.
Said Noah Tratt, global vice president of media solutions at Expedia, “Rather than a linear path to purchase, the research and booking process of today’s traveler looks like an ongoing and multi-directional flight map, with each stop providing an opportunity for brands to reach and engage with travelers.”
Customers have been spoiled by the high degree of personalization they enjoy from retailers, banks and others. Adara sees additional customer data as the answer to the fickle customer – pointing to one example where, by adding four customer data points above a baseline set, an ad’s performance improved nine times compared using only the baseline customer data.
“Best” deal is coming to mean”most relevant” deal according to the report – rather than lowest price. Digital communications and call center interactions must be informed by customer insights that can help you better personalize messages and offers.
Bottom line: understanding the guest on every level possible isn’t a “nice to have” for hotels – it is a key strategic priority in order to serve a guest who experiences high degrees of personalization from so many other vendors.
Said Harteveldt, “Hoteliers can now access actionable knowledge about their customers and their shopping and booking behavior to reach them when they are making their booking decisions.”
Harvey Chipkin has been writing about travel for many years. He contributes regularly to “Travel Weekly,” “Lodging Magazine” and “Travel Market Report.”
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