Courtesy: Niall Corrigan, Sales Manager | News Source: digital.travelport.com

The digital customer is not being fully served by the hotel industry and the opportunity for a hotel to fully leverage mobile to capture this customer has now arrived. Segments such as Gen X, Gen Y and, even more so, the Millennial all have increased wallet share, and are under maximised revenue opportunities for hotels. However, their interaction habits are starkly different to what the hotel industry is accustomed to. The digital customer is also known as the silent customer because of their frequent preference for using technology to communicate rather than face-to-face engagement. While they may be “silent” when it comes to face-to-face communication, they are undoubtedly vocal on online platforms like Twitter, Facebook, TripAdvisor and other review sites. In order for hotels to capitalise fully on this opportunity hotels need to become more “au fait” with the digital ecosystem, in particular mobile, which is this segment’s preferred channel.

In order to capture digital customers, a hotel’s mobile solutions must be engaging and provide value to the customer. The mobile offering must “delight” the end user. Delighting the customer is not just about a nicely designed user interface, it requires understanding the wants and needs of the target segment. Obviously, the offering can be mutually beneficial and generate ancillary revenue for the hotel, but that should not be the predominant focus. Mobile engagement has been shown to lead to increased mobile usage, loyalty and advocacy, which in turn lead to increased revenue and a much higher Net Promoter Score. In Q1 of 2014 search volumes were, for the first time in history, greater on mobile than desktop, and with mobile revenues increasing year on year it is now more than just a nice to have but a truly strategic channel. Mobile is strategically very different to the traditional desktop approach. Mobile app users are identifiable which presents a new data opportunity.

“Big Data” has been the mantra of consultants for the last decade. The term’s first publication, according to Forbes, was in an article in 1997. But to what extent has “Big Data” improved the customer experience? In retail, contextual upsell based on comparative customer purchasing is effective but mainly relates to low cost items. Online retail platforms such as Amazon are masters of leveraging “Big Data”, enabled by a single view of the customer supported by modern infrastructure and databases. We are now in an age where a few digital interactions can group customers into segments using quantitative analytical segmentation models devoid of personal human driven business insight.

Comparatively, the travel industry has been slower to adopt analytical segmentation because it has been hampered by disparate CRM systems that don’t enable a single view of the customer. The approach of leveraging “Big Data” insights is appropriate for a broad campaign where anonymity and generalization are the mode, but not suited to niche, personal segmentation.

Nevertheless, in the hotel industry, is the “big data” segmentation approach fully appropriate? Should leveraging these data insights take precedence over years of business acumen and industry insights? A hotel manager passing a customer in the lobby whose name they know will address the customer by name knowing that the personal touch makes the customer feel more valued. Hotels need to translate the value of personalization into the data-centric view of the customer. Mobile presents the best opportunity to leverage data and the data strategy should be threefold and leverage “Big-Data”, “Small Data” and localized business experience The mobile channel can maximize the opportunity to create a single view of the customer by using mobile sources such as social media, loyalty schemes, in-app profile data and the customers’ mobile digital interactions to create this “small data”.

Every customer leaves a digital footprint in the online world. Some leave them more overtly, for example by joining loyalty schemes and/or leaving online feedback of their experience. Others leave them more covertly across their exploration, booking, check-in and on-property interaction. The difficulty is creating a single view of this customer as they journey across the digital ecosystem.

The mobile channel can maximize the opportunity to create a single view of the customer by using mobile sources such as social media, loyalty schemes, in-app profile data and the customers’ mobile digital interactions to create “small data”. Hotels need to combine this “small data” with the “big data” to derive detailed insights and develop more detailed segmentation. Once these segments have been developed, hotels should apply business acumen and experience to create offerings to “delight” the mobile customer and become truly customer-centric.

When leveraging data one can take the same approach as Newton’s third law of motion – for every action, there is an equal and opposite reaction. The long-term objective is not only the overarching goal of increasing the customer experience, advocacy and Net Promoter Score, but also to entice the customer to continue to engage in digital interactions so that offerings can be implemented, measured, refined and tested. A feedback loop should be put in place to collate all data generated from these offerings to continuously improve the digital interaction with the customer. The mobile offering and functionality should always ensure there is a benefit to the end customer. For example:

Customer benefit Data leveraged Faster time to book Shortening the goal path utilizing saved personal data Offering appropriate timely ground services Leverage customer flight arrival time, location and travel preferences Destination offers Understanding the purpose of the customer’s visit.

Mapping the customer journey can provide insights into which potential offers can extend the hotel experience into off-property hospitality. The mobile functionality can extend the customer’s brand experience so it begins well in advance of setting foot on-property. Moving along the travel vertical will not only increase cross-sell opportunities but will also ensure customer pain points are addressed. Tackling customer pain points ensures that customer advocacy and brand loyalty increase. The mobile channel should be treated as a digital concierge that interacts with the customer in a voice that appears to the customer as if it is speaking directly to them. Therefore, the “small data” approach can allow this digital concierge to provide customers with the right content in the right context. It is imperative to ensure that the content provided is contextually appropriate to make the mobile offering engaging with a personalised approach.

Integrating with the hotel’s central reservation system, property management system and CRM system and supplementing them with mobile “small data” can support personalization. This allows for the creation of a single customer view. Once this data is enriched with contextual data, for example weather, flight information, geo-location and customer preferences it creates a true 360-degree view of the customer. This creates a mobile gateway, where hotels can then interact with their clients, resembling a digital concierge, led by business defined content offerings that are contextually appropriate. The graphic below shows some use cases of this contextual content approach along the customer journey that extends off-property:

Other mobile technology can further extend this digital interaction. Recent advances in iBeacons can utilise geo-location to create an even deeper contextual interaction. An iBeacon positioned in the correct location can trigger a notification to a customer passing it about the ground transportation hotel shuttle from the airport as they pick up their luggage, remind them they can check-in online as they travel in the shuttle or even welcome them as they step into the hotel lobby. Again the customer’s journey should be mapped to understand the appropriate interactions for the hotel’s customer segments whilst identifying operational efficiencies that could also be achieved, e.g. reduced check-in queues due to customers checking-in online in the hotel shuttle. Pushing a digital room key to the customer could extend this even further. In app instant messaging or an integration of twitter could also facilitate customer queries on mobile, from is breakfast included in my booking to how far away is the theatre?

When personalization can be integrated with destination marketing it can provide ancillary sales opportunities by offering the right customer the right offer, at the right time, based on data insights. However, as highlighted earlier there must also be a benefit to the customer and this benefit can be delivered with an integrated itinerary manager. If customers were, for example, to book a tour or a restaurant then the hotel should allow the customer to book and store the booking in the hotel’s app, which in turn creates customer stickiness. Allowing customers to get map info in-app to get to the restaurant or tour bus stop creates more engagement and loyalty. Therefore, as a hotel examines cross-sell partners, they should also assess data availability, APIs and app integration ensuring a continued seamless in app customer journey – not just transaction fees.

In summary, in order for a hotel to become truly customer-centric they should begin to explore how off-property hospitality can address the customer’s pain points and enhance the customer’s experience by developing engaging mobile apps. Leveraging “Big Data” in a mobile strategy is beneficial but limiting, and hotels must also leverage the “Small Data” and digital interactions to provide “delight” to customers. The digital landscape is always changing and choosing a mobile engagement partner is key when developing agile solutions. Having an agile approach will allow hotels to pivot quickly to combat disruption. The future is likely to see travel companies move further along the value chain to eliminate non-performing suppliers but this will only be achieved by hotels that are technologically sophisticated and customer-centric on the mobile channel.