How Data is Changing Vacations—and the Way We Book Them

How Data is Changing Vacations—and the Way We Book Them

Tuesday, July 23, 2019
Eli Grant

We’re traveling more than we ever have before. According to the US Travel Association, in 2018 domestic travel alone accounted for nearly $1 trillion in consumer spending; a 5.8% jump from 2017. Internationally, we made more trips than ever recorded: over 21 million in the first quarter of 2019, which is an increase of more than 37% over the last five years. Economic factors are the leading driver in these increases, but the ease by which consumers can plan their travel has only added fuel to the industry.

Today, our options for discovering, buying, booking, and documenting our journeys have never been wider. The days of visiting your local travel agent’s office and having them help craft the perfect family vacation every year are long gone. But, as in many categories, the goal for many travel and hospitality brands today is to replicate this close relationship—this personalized service that travel agents once provided—but to do so at scale, for millions of customers simultaneously. And, as in other categories, data is the enabler for this personalization at scale.

Is personalization at scale the new travel agent?

Consider what your travel agent once knew about you: name, number of family members, preference for beach vacations or city breaks, previous destinations (if booked through them), and, if they were good at their jobs, a little more about your family, your job, your likes, and dislikes. They also had access to some hotel room inventory and pricing, preferred airfares, and other major components for your trip. Many agents made magic happen for families for decades by leveraging this information to create outstanding experiences at the best prices for their few dozen to few hundred or so clients.

Kid tourists visiting Paris

But this pales in comparison to the data United or Marriott or Expedia or Airbnb or any other of today’s travel companies (not to mention Google and Facebook) leverage to draw you to book travel with them. Full demographic profiles, the last 10+ years of travel history, the activities you booked, what you liked doing, and where you had a negative experience… They likely know what you like to eat, what your kids enjoy, your spending habits, your friends’ travel habits, where people similar to you travel to, and on and on. (To be clear, it’s entirely possible to build valuable customer profiles and use these in straightforward, value-adding ways for a traveler without running afoul of laws or consumer sensibilities.)

Armed with this information, travel and hospitality brands can present me with compelling offers tailored according to where I’m likely to visit, what time of year I’m likely to go, and the type of accommodations that are right for my family. I’ll read emails that cut through the clutter of my Gmail Promotions folder; I’ll notice the relevant ad on ESPN.com or CNN.com; and I’ll read more about the targeted on-site offer I see while booking an unrelated business travel trip. Between these personalized recommendations and the rewarding of loyalty that builds more, I’m going to jump at the chance to book with confidence and excitement.

Proactive promotions for the discerning traveler

Last year, Phocuswright estimated that the global tours and activities market would outpace the travel industry as a whole and rise to $183B by 2020. The US Travel Association credits 11% of the total spend in the travel category to recreation and amusement; this is on top of the 25% on food and beverage. In other words, once a trip is booked—and even after it’s started—there’s still significant opportunity for travel and hospitality brands to provide additional services to influence, if not capture, additional spend. Again, leveraging data is the key to effective digital engagement around tours, activities, and local experiences.

Heading off for a day hike in the Great Smoky Mountains

Dog-eared Rick Steves, Lonely Planets, or Fodor’s guides are as essential as toothpaste for many travelers (myself included) but smartphones are now our most ubiquitous travel companions. From the Google Maps app to instant-access dinner reservations or tour tickets, we’re just as reliant—or maybe even more reliant—on our devices while we travel than when we’re at home. Fortunately for travel brands, this creates exciting opportunities to become a valued resource for curating local experiences.

My hotel knows where I’m staying and can serve me targeted offers for museums or shows within walking distance. The booking platform I used knows from my past travels that I love dim sum and can direct me to the best local spot. My cruise ship can recommend the right excursion options for travelers with young kids. Even my airline can prompt me about where to pick up gifts my family will love when checking in for my flight home.

Travel is changing. Is your brand keeping pace?

The rapid evolution of technology and data is opening a world of opportunity for travelers and travel brands alike. Businesses that embrace this change will position themselves to be a trusted advisor to their audiences, helping to create unforgettable journeys and experiences beyond the means of the traditional travel agent.

Has your brand already started its journey to becoming an indispensable traveler’s companion? It’ll likely take in-depth research, strategic business planning, and—most of all—some deft-handed data activation. We can help you get there, and it all starts with a friendly chat. Contact DAC today.