The Five C's of a Smart Analytics Budget

By Michele Walters Co-Founder, Origin World Labs | December 16, 2012

It is hard to argue with the claim that Analytics is the hottest buzzword in business today. More specifically, the impact of Big Data is now a global topic of conversation in industry, government, and education. In the hospitality industry, every function from RM to Marketing to F&B is becoming more data driven. Unfortunately, behind every technology bandwagon there are a plethora of unproven software startups cashing in on the unceasing pressure placed on managers to find a way to consistently outperform the competition or, at a minimum, beat last year's results. The smartest of these vendors are out in full force this time of year, with their flawless demos, in order to ensure inclusion in your budget for next year. Allow me to save you thousands or even hundreds of thousands of dollars. Analytics is not about software, it's about people. If you are serious about beginning the transformation to a data-driven hotel company, where decisions are based on fact rather than faith, you should first be spending your analytics dollars on brains and not on bytes. In 2013, make sure your analytics budget includes spending on the five C's of Culture, Collaboration, Communication, Critical Thinking and Cultivation.

Culture of Data

All successful analytics driven organizations have had to undergo a transformation from a culture where the HiPPO (Highest Paid Person's Opinion) guides all decisions, to one where everyone in the organization defers to data insights to illuminate the best course of action. This cultural shift will require all employees to be engaged and committed to a data centered management philosophy. That means new training, off-sites, presentations, and incentive programs that reward managers who dig deeper to understand problems before making decisions. Unfortunately, changing a company's culture does not happen overnight. For many, cultural change becomes an indefinite process which requires long-term commitment and ongoing investment. Companies that are not willing to make adequate investments in creating a culture of data typically find that their biggest analytics initiatives fall flat.


When you think analytics, you may picture a lone statistician in a room with a giant server, crunching through formulas that spit out perfect answers to complex questions. Similar to how the Jonah Hill character in the movie Moneyball sat in his little office analyzing player performance. Ironically, the most successful analytics driven companies work exactly the opposite way. They employ a collaborative effort among analytical, technology, creative, and operations people to create a fruitful data driven environment. Let's look at how working together is critical for the three basic steps of the analytics process.

All successful analytics projects start off with good data. Easier said than done. Many companies have reported spending millions trying to clean their data only to discover that, in hindsight, it was not worth it. Caveat emptor - you don't need clean data, you just need "clean enough" or "cleaner" data. Just clean enough to be consumable without running the risk of contaminating your decisions. Generally, you can leapfrog a lot of useless data cleansing if you can harvest the practical knowledge of those who input it and use it. This means understanding job functions and operations protocols in order to identify the dynamics that contribute to inaccurate or missing data. It also means getting everyone to re-consider why some data is collected in the first place. If you dig deep enough, you will find data that is collected for no other reason than because it has always been collected.

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Coming up in February 2019...

Social Media: Getting Personal

There Social media platforms have revolutionized the hotel industry. Popular sites such as Facebook, Twitter, Pinterest, Instagram, Snapchat, YouTube and Tumblr now account for 2.3 billion active users, and this phenomenon has forever transformed how businesses interact with consumers. Given that social media allows for two-way communication between businesses and consumers, the emphasis of any marketing strategy must be to positively and personally engage the customer, and there are innumerable ways to accomplish that goal. One popular strategy is to encourage hotel guests to create their own personal content - typically videos and photos -which can be shared via their personal social media networks, reaching a sizeable audience. In addition, geo-locational tags and brand hashtags can be embedded in such posts which allow them to be found via metadata searches, substantially enlarging their scope. Influencer marketing is another prevalent social media strategy. Some hotels are paying popular social media stars and bloggers to endorse their brand on social media platforms. These kinds of endorsements generally elicit a strong response because the influencers are perceived as being trustworthy by their followers, and because an influencer's followers are likely to share similar psychographic and demographic traits. Travel review sites have also become vitally important in reputation management. Travelers consistently use social media to express pleasure or frustration about their guest experiences, so it is essential that every review be attended to personally. Assuming the responsibility to address and correct customer service concerns quickly is a way to mitigate complaints and to build brand loyalty. Plus, whether reviews are favorable or unfavorable, they are a vital source of information to managers about a hotel's operational performance.  The February Hotel Business Review will document what some hotels are doing to effectively incorporate social media strategies into their businesses.