Data analytics an interesting prospect for travel sector
Call to action: how to make the most of big travel data
Travel companies can use data analytics to create competitive advantage, but it is not just what you know that wins in this business dynamic, it is about how fast you make sense of it and what action you take.
Travel companies are taking a closer look at formal data management strategies in order to derive more value from data assets. Data analytics is an interesting prospect for the travel sector as so many data streams can be combined.
As IBM points out, 2.5 quintillion bytes of data is created each day. Furthermore, 90 percent of the so-called “big data” in the world today has been created in the last 2 years alone. This rapid generation of data from mobile devices, social media, cloud computing, and so on, calls for action from all businesses and those in the travel industry are no exception.
To date, many travel companies have utilized data analytics in areas like revenue management, capacity planning, and network planning, or inventory management. But these analytics applications are typically stand-alone and do not interact or share information with other systems and processes across the enterprise.
“Today, travel companies should be utilizing advanced analytics to better understand their customers’ needs and preferences, and then design a highly-customized sales and service process to meet those needs - thereby, enabling them to grow, retain, and satisfy the increasing expectations of today’s travelers,” said Greg Land, Associate Partner, Global Industry Executive, Travel and Transportation Practice at IBM.
According to Land, the data and associated analytics must be managed so that it can be shared across the enterprise to improve everyone’s understanding of the customer as well as the speed of decision-making.
In addition, advanced analytics is being used to increase operational efficiency, transform financial processes, manage risks, and improve safety and security.
Putting a plan in place
Building interconnected data streams is an organic process. You can’t make it happen overnight. As firms plan to take the plunge, here are some expert recommendations:
-Do have an analysis plan, before you dive into data .
-Do remember that data mining should be focused on tactics and return on investment.
Atique Shah, Director of Customer Relationship Management (CRM) and Analytics, InterContinental Hotels Group (IHG), said that when working on data analytics one should:
-Focus on areas where an impact can be made.
-Understand how to engage with consumers more efficiently.
-Identify patterns that can lead to insights around consumer acquisition, retention, and marketing.
To drive innovation and improve the customer experience, IBM works with travel companies to integrate advanced analytics with business processes and sales and service processes. To this end, Land says business rules’ engines, such as iLog, can be used to leverage customer insights from advanced analytics to drive a more personalized service delivery process on a mobile app, a travel website, or even a kiosk application.
The company also has travel clients integrating advanced analytics with enterprise marketing systems, such as Unica, to help them develop more targeted and personalized campaigns. What is more, this can also help to improve the sales conversion of offers and as a result, improve the return on marketing spend.
More travel businesses are also embracing technologies that gather, organize, and understand online consumer sentiment.
“There is also much focus on advanced analytics with mobile applications and social media, to better understand how travelers are using these channels and continue to improve how they can be utilized to relieve traveler pain points throughout the shopping and booking processes, as well as during the journey itself,” said Land.
On how to convert data sources into actionable business intelligence, IHG’s Shah said one can do so by:
-Discriminating against data sources that do not add value, since not all data is created equally.
-Trying to put things into order of importance. Start with high impact data sets that are deemed mission critical and then see how you can apply it to business directly. Then move to next one and so on.
Identifying the challenges, taking action
There is a “big data” revolution underway in the travel and hospitality industry, but travel companies need to be clear about the challenges.
According to Land, hurdles are related to managing and benefiting from massive and growing amounts of data, dealing with the uncertainty around format variability and velocity of data, and handling unstructured data.
“These all apply to the travel and transportation industry more so than ever - shopping and booking activity across multiple channels, traveler and transaction data from reservation systems, activity from campaign management and loyalty programs, activity from social networks, and many others,” said Land.
So travel companies must map out a basic plan to optimize the use of “big data” and employ advanced analytics. Land advises firms to:
-Establish an end-to-end vision and information-driven strategy with clear objectives that enable its business priorities.
-Align people, process, and information to unify tools and leverage expertise with the strategic value of the data and information.
-Accelerate information-intensive projects aligned with these strategies in order to speed both short-term and long-term return on investment.
-Deploy open and agile technologies in order to leverage information assets for speed and flexibility.
Business analytics pulls insights from vast databases commonly referred to as “big data.” To be successful and maximize the value of this, firms need to be very focused and disciplined.
“Efforts to manage ‘big data’ and operationalize these advanced analytics means the offices of the Chief Marketing Officer and the Chief Information Officer need to be more closely aligned and working in collaboration on the requirements for the enterprise to create competitive advantage,” said Land.
A few points that these two teams should consider:
-Create an information-driven strategy.
-Focus on the biggest and highest value opportunities.
-With each opportunity, start with questions, not data.
-Integrate insights gained from advanced analytics into your business processes to drive action and deliver value for the enterprise.
-Keep your existing capabilities while adding new ones gained from these insights.
Atique Shah, Director of CRM and Analytics, InterContinental Hotels Group, and Greg Land, Land, Associate Partner, Global Industry Executive, Travel & Transportation Practice at IBM will be speaking at target="_blank">EyeforTravel’s Travel Distribution Summit, North America in Las Vegas from September 13-14 alongside 90 other industry leading experts. See the full target="_blank">mobile agenda and speaker line up here.