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Personalized Offers in the Travel Industry: Key Takeaways

March 21, 2019

In this article you will learn:

By Rob Fagnani, Head of Business Development & Operations

Last week, I had the pleasure of joining Christian Selchau-Hansen, our CEO, and Hillary Grey Slater, a digital personalization leader at our client United Airlines, for a presentation at the Eye For Travel Conference in San Francisco. The focus of our talk was on hyper personalized offers—how travel marketers can use AI and machine learning to create individualized experiences that help brands connect with their customers and achieve their business objectives.

Eye For Travel brought together a dynamic mix of marketers and technologists from across the travel industry. For everyone there, hyper-personalization was definitely top of mind. Every speaker had their own vantage, reflecting their own priorities and experiences. However, when stitched together, they presented a comprehensive roadmap to standing up and operating hyper-personalization at scale—a roadmap validated by our own experience working with many large enterprises.

Here are the key takeaways about hyper personalized offers:

1. Make data activation a strategic priority.

This was a key takeaway from the talk delivered by Jess Petitt, Hilton’s Vice President of Analytics. Jess put his company’s current investment in data infrastructure within the context of its historical investments in technology. The installation of air conditioning, which Hilton did on a global basis in the 1950s, presented an interesting parallel to how Hilton is activating its data to enhance the customer experience.

2. Hyper personalized offers isn’t a one-size-fits-all proposition.

A company’s business objectives will ultimately determine the scope and scale of its data needs. Dr. Shuo Wang, principal data scientist at CWT (formerly, Carlson Wagonlit Travel), highlighted this idea in his session. An airline with business objectives such as driving incremental bookings, decreasing flight boarding times, and increasing engagement with its hotel partners, will want to understand how it can achieve those objectives by leveraging data sets that align with those objectives. While this is common practice, how to leverage those insights to create customer experiences that achieve those objectives is not always clear.

Let’s use the example of decreasing flight boarding times, particularly through speeding up the process of gate checking of bags. Both airlines and customers dislike delays due to the cost and inconvenience they cause. When an airline looks to address this, it will likely start by predicting which flights will be oversold and possibly requiring a certain number of bags to be gate checked: that's the insight.

To leverage that insight, an airline might want to engage and incentivize customers on the oversold flight to accelerate the gate-checking process. To do this requires an understanding of each customer’s motivation so that the right type of experience can be deployed. For a competitive flyer (you know that flyer—the one who's always jostling to be the first one to board), a competitive race might be the best offer: “Be one of the first 10 people to check in your bag and earn 1,000 bonus miles.” For a socially motivated flyer, a cooperative offer might be more effective: “If you and 15 of your fellow passengers check your bags, you’ll each get 1,000 bonus miles.”

It’s not only about building the right model to reach an insight, but also about understanding customer motivations and using those insights in experiences that map to business objectives.

3. Experiment and scale-up.

We’ve been working with United over the last year, helping them power Mile Play, their groundbreaking program that delivers a sequence of personalized offers and rewards to their frequent flyers. Over that time, I’ve been impressed by their speed and agility. According to Hillary, one of the secrets to their success has been their willingness to experiment and test new ideas with their personalization initiatives. The lesson: Don’t be afraid to put something in the market and see what happens. The opportunity cost of not testing a concept is too high when considering the value of the learnings gained. So see what resonates with your customers and what actually moves the needle.

There are two caveats, however. First, to do this, you need technology that can learn, adjust, and be in and out-of-market quickly. Second, you need a team and process that’s built for speed, which brings me to my next and final point—

4. Hyper-personalization is as much a question of human resources as it is a question of technology.

Cross functional collaboration is key. As Hillary mentioned during our discussion, their digital personalization team is part of United’s digital technology organization, which makes deploying new technology, tactics, and offers quick and efficient.

Moreover, as noted by Kristie Goshow, the CMO of Preferred Hotels & Resorts, the hyper-personalization mindset needs to infuse every part of your organization—from marketing to new construction, technology to food & beverage. Personalization doesn’t stop when the room, flight, or cruise is booked—not even when the guest is checked in. It goes beyond bookings and should be a part of every customer interaction.

It was remarkable to see how personalized offers has gone from a marketing buzzword to a table-stake, and it was fascinating to see how different companies are implementing strategies, technology, and tactics to deliver better experiences to their customers.

If you'd like to learn more, join us at the Digital Travel Summit in Palm Desert, April 8–10, or reach out to us directly.