Is Personalization Travel's New Super Power?

By Pamela Whitby Editor, EyeforTravel Ltd | July 16, 2017

For successful tech companies building a solid and loyal customer base is far less about trusting your gut than having the right data and testing and learning from it. Flattened company hierarchies are also seen as important in getting the best from teams and, as a result, building more successful customer relationships based on personal preferences. So in a turbulent and highly competitive market, should hotels should start thinking more like tech companies to take back control?

Is "Challenging Assumptions" the key to cracking customer experience? Booking.com thinks so and others do too. Love them or hate them - and yes hotels over the years have had a pretty tetchy relationship with booking.com – but few could dispute how successful a company the Amsterdam upstart has been.

After being acquired in 2005 by Priceline for $135m in cash, booking.com helped catapult its US parent from a $10m company to one worth over a billion dollars. This booking.com acquisition, along with others like Agoda, Kayak and more, was, as Priceline CEO Glenn Fogel outlined at a recent EyeforTravel conference, part of a strategic push to go global. “We found companies that knew how to sell the way people in Europe [and other parts of the world] wanted to

A decade on and in 2016, booking.com was responsible for 80% of Priceline’s annual revenues. Great news for Priceline! Not such great news for hotels, which over the years have lost control of inventory and forked out commissions of anything between 15 and 30% for privilege of a presence on OTA websites.

But with eroding margins and regulatory pressure brought to bear on OTA bully boy tactics in the US and Europe, the fight back has begun. Recently, we’ve seen some hotels taking back control by innovating with loyalty programs, technology and more, and even entering what are perceived to be fairer deals with Google (that is another story).

Although there is still some way to go, there is a growing recognition that OTAs, if managed correctly, can play a valuable role. But as Brian Harniman, a former Priceline executive and founder of strategy advisory firm Brand New Matter, puts it hotels need to “partner wisely”. Other advice includes using data to shift from cost per booking to cost-per-customer, providing real value (such as upgrades, free drinks and so on) and never ever allowing anybody to dictate RM practices.

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Coming up in February 2018...

Social Media: Engagement is Key

There are currently 2.3 billion active users of social media networks and savvy hotel operators have incorporated social media into their marketing mix. There are a few Goliath channels on which one must have a presence (Facebook & Twitter) but there are also several newer upstart channels (Instagram, Snapchat &WeChat, for example) that merit consideration. With its 1.86 billion users, Facebook is a dominant platform where operators can drive brand awareness, facilitate bookings, offer incentives and collect sought-after reviews. Twitter's 284 million users generate 500 million tweets per day, and operators can use its platform for lead generation, building loyalty, and guest interaction. Instagram was originally a small photo-sharing site but it has blown up into a massive photo and video channel. The site can be used to post photos of the hotel property, as well as creating Instagram Stories - personal videos that disappear from the channel after 24 hours. In this regard, Instagram and Snapchat are now in direct competition. WeChat is a Chinese company whose aim is to be the App for Everything - instant messaging, social media, shopping and payment services - all in a single platform. In addition to these channels, blogging continues to be a popular method to establish leadership, enhance reputations, and engage with customers in a direct and personal way. The key to effective use of all social media is to find out where your customers are and then, to the fullest extent possible, engage with them on a personal level. This engagement is what creates a personal connection and sustains brand loyalty. The February Hotel Business Review will explore these issues and examine how some hotels are successfully integrating social media into their operations.