Why relevance is key to future-proofing travel brands

Stuart Stacy, vice president, managing director Asia-Pacific at Adara, shares how travel marketers need to gain deeper audience insights and adopt data-driven solutions to ramp up personalisation and deepen brand loyalty amid a flattening trajectory of the travel market.

Stacy: Relevance is key driving force for brand loyalty in current climate of heightened competition

The travel industry in Asia-Pacific continued to remain resilient through the first quarter of the year, despite slowing economic growth in the region. Yet, some early signs of a slowdown have begun to emerge. Against a backdrop of mounting fears of a global recession and falling consumer confidence, it is no wonder that the region has adopted a modest 2019 industry forecast. For travel marketers, this means harder work is required to win share of wallet in a tightening market.

In an environment of flattening demand and rising competitiveness, travel marketers need to shift their thinking. They must commit their limited resources to the most valuable groups of customers – not only those who spend the most now, but those with a high lifetime value, who are likely to spend the most in the future.

While some of the insights into customer value are readily available through booking channels and loyalty behaviour, a bigger commitment to achieving deep understanding of the customers through other touchpoints is required. Only then can travel brands deliver truly relevant marketing and future-proof themselves in the face of adversity.

Deeper commitment to knowing your customers

Travel brands amass a vast amount of traveller data on a daily basis – search, booking, loyalty, customer service, and even data from other brands through established partnerships. However, this data can be limiting in that it aims to provide an understanding of the highly complex customer through just a few facets of the individual.

Such data is insufficient for determining a customer’s lifetime value and travel marketers need to commit to broad information gathering to truly understand their vibrant individual customers. This has led to second-party data sharing becoming more common in Asia-Pacific, as travel brands look to partners to get a panoramic view of customers’ behaviours and intentions. For instance, Changi Airport group looks at both second- and third-party data from multiple sources, in addition to first party data collected through point-of-sale at retail stores, Wi-Fi and CRM. Similarly, Malaysia Airlines has established second-party partnerships, especially with credit card companies through its loyalty programme.

This kind of data exchange allows travel brands to tailor personalised marketing campaigns based on in-depth audience insights, while leveraging the value of real-time data to identify shifting behavioural trends of their customer base.

Navigating Asia-Pacific’s uneven loyalty landscape

Travel loyalty programmes exist to influence behaviours in favourable ways. However, in Asia-Pacific’s uneven loyalty landscape, where markets stand at different points of the maturity curve, travel marketers face the daunting task of keeping existing loyal customers in mature markets engaged, while also accurately isolating and targeting high-value travellers in emerging markets.

In this era of digital-based competition and heightened customer control, relevance has become a key driving force for brand loyalty.

Studies show that customers who donate the most data are the ones that expect greater personalisation in the marketing messages they receive. Combine this with the emerging trends of last-minute bookings and mobile-first experiences, and travel marketers must be able to strategically leverage on data from various touchpoints to understand each individual’s preferences at a higher granularity.

Knowing more about each customer can also help travel marketers prioritise the most valued ones. For instance, loyalty members can be scored based on the points they have, the types of trips that are earning these points from, their level of activity, where points are being channelled to and how often they cancel. These insights can then point towards the indicators used in customer relationship building.

In the pursuit for sustained attention of existing loyalty members, travel marketers must not neglect potential customers. Not every valuable customer is necessarily already part of the loyalty programme, and travel brands that use a wider array of inputs are better poised to unlock future value.

Increasing brand stickiness

Marriott reported the symbiotic relationship between growing loyalty members and greater owner benefits for the year of 2018, proving that loyalty programmes can grow through exciting destinations, accommodations and service offerings that are new, better and more relevant to customers’ needs and preferences.

As the travel sector faces a world of renewed expectations, travel marketers must understand that digital capabilities and advantages that were once differentiators are now readily available to all. For brands to remain relevant, it is also imperative that existing capabilities and technologies are used to reinvent service offerings that address the pain points of travellers. For example, Delta pioneered the use of RFID technologies to track baggage. It has helped to alleviate the issues of lost or delayed baggage, while conferring travellers globally with greater control of their flight experience.

The proliferation of travel options across Asia-Pacific has also altered the notion of brand stickiness. Many travel programmes do a great job with providing different ways for members to redeem miles or points, but more often than not, they aren’t tailoring other elements of the programme, such as messaging, which feel generic and sometimes totally irrelevant. Being able to tailor the types of upgrades customers value is one of many examples of how loyalty messaging could be made more relevant.

It remains to be seen if travel in Asia-Pacific will be hit with a recessionary chill in the coming months. However, as savvy travel brands know, this is an opportune moment to future-proof. Travel brands must focus on maintaining brand relevance in a region where travellers are ever-evolving. Though the addition of data-driven elements to marketing efforts may add additional layers of complexity in the short-term, it may very well be the difference between success and failure in the long-term.

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