As more travelers seek to book experiences and tours, hotels need to find ways to gain a competitive advantage to avoid losing their fair share of customers to aggregators. As spending on experiences and tours is discretionary and many options exist, personalization is critical to staying competitive.
Hotels are just as equipped as aggregators, if not more, to generate and deliver personalized offers, because they have rich data on travelers’ room and tariff types, dates, stay experiences and preferences. They also have the ability to influence travelers through high-touch interactions online, at check-in and through the concierge, have local intelligence and therefore greater credibility, and, over time, can collect historical tour and experience booking data, and leverage tour operator relationships and new offerings to send personalized offers to travelers.
However, there are many challenges that hoteliers face with personalization:
- Data: Episodic transactions are captured in fragmented data sources across hundreds of properties. There’s also limited standardization, which makes stitching together this information difficult.
- Determining who drives personalization: Is it HQ or the property? What is the split of responsibilities between the two interested parties, and how is the upside to be shared?
- Determining who within HQ drives personalization: The customer experience, revenue management and customer loyalty departments all have legitimate reasons to drive this effort.
Here are three ways that hoteliers can modularize their execution of personalization to make small but concrete progress:
- Scope: Begin efforts with select, savvy brands and properties located in geographies where there is established demand. Ensure that there is some degree of data maturity and relationships with tour operators, and that both HQ and the properties are excited about the initiative and will do what they can to ensure success.
- Sophistication: Start with a rules-based static recommendation with a goal to eventually develop behavioral-based real-time recommendations. Leverage existing customer and booking information at the property level, concierge intelligence and gradually build advance data assets (customer type, acceptance rate, redemption pattern, ratings and reviews). Don’t wait for the perfect data – it doesn’t exist!
- Delivery: Start with delivering recommendations at the time of check-in, during the stay or through the concierge. Work your way up to sending recommendations a week before travel or a week after booking, and finally, to making real-time recommendations. The goal could be to provide an AI-enabled intuitive tool to create an entire itinerary and drive traffic to the web. Another goal may be to have the experience increase room nights as well.
With a long-term mindset and a planned and purposeful modular approach, hotels can not only tap into the growing tours and experience booking market, but also develop a competitive advantage in the overall marketplace.