The Digital Travel Revolution

Big data technology enables us to find intelligence in billions of datasets and is very quickly transforming the way consumers are marketed and sold travel. While you might think you’ve seen a fair amount of this so far on Expedia, Priceline, Trivago or whatever travel sites you use, considering the dollars involved in the travel industry, this represents nothing short of a digital travel revolution. I think this quote summarizes it very well:

“…While technology has brought in huge opportunities for travellers, on the flipside, travel service providers are exploring ways and means to effectively utilize technology to overcome the challenges of competition, reach, and service quality and customer preference. They are now embracing new age disrupting technology concepts like Big Data Analytics to increase their business efficiency, stand out among competitors and to transform customer experience into a true delight…[1]

The global travel industry, expected to grow to 10% of Global GDP by 2022, on annual revenues of around $10 trillion, handles an enormous quantity of data every millisecond. The ever-generated data from different sources and actions (reservations, itineraries, accommodation, inquiries, transportation, price, cancellations, customer feedback, geo-location, etc., needs to be processed wisely. Travel companies are now embracing Big Data Analytics to leverage this big data to provide their customers more targeted campaigns which ultimately lead to profitable services and products.

Don’t think that travel sites armed with their Big Data Analytics investments will stop at hotels, airlines and rental cars. More and more travel-related products and services will be enabled and offered to enhance the customer experience in the near future.

Competitive Differentiation

As travel service providers and companies differentiate their services and products from their competitors with the use of Big Data Analytics, they will stand out from the crowd. For instance, an online travel portal can make use of big data such as automatically presenting a customer room options if he misses a connecting flight.

Improving Price Strategy

Price is one of the most important decision factors for travelers when planning their trips. Big Data Analytics can track, index and analyze competitors’ prices and gain a clear picture of trends from multiple sources, including importantly social media. This smart automation with real-time analytics helps companies build a consistent pricing strategy and track changes in pricing for better customer experience.

Dynamic analyzers are used to present consistent price information. For instance, KAYAK uses analytical models to ensure that airline travel prices displayed on its website are consistent with those on airline sites. With the help of big data predictions KAYAK has also recently introduced flight price forecasting, which predicts whether, in the next seven days, the price of a particular flight will go up or down.

Upside.com, a business travel service headed by the founder of Priceline, applies its own particular data analytics model to ensure that when a customer searches for a hotel and flight package it delivers the lowest price to the customer.

Improving Marketing Strategy

Analyzing big quantities of data from travelers enables travel service providers to gain valuable insights that will enable them to continuously optimize their marketing efforts. They will be able to deliver targeted offers including location-based real-time offers and receive the optimal results from these highly-tailored marketing activities. Big Data Analytics also help digital marketers maximize their ROI through personalized marketing messages and allows them to design the right marketing strategies.

Big Data Analytics can also help improve business efficiencies, such as dynamic pricing policies replacing manual fares with intelligent automation, and gathering and analyzing real-time data from multiple sources. They also offer real-time analysis of competitors’ pricing as well as predicting pricing trends for similar products and services, by analyzing the past and present data.

Travel sales and marketing efforts are enormously improved by Big Data Analytics with more targeted marketing campaigns being delivered through the right channels via close customer engagement resulting in better conversion rates.

In addition, sales and marketing departments can get a micro view and understanding of future demand patterns — and, by extension, gain insights to optimize investments by knowing what campaigns are working and “seeing” their least profitable products and services.

Big Data Analytics enhance the customer experience by making it more responsive and focused around the traveler’s personal preferences, provide them with tailor-made products and services and aggregating feedback, reviews and recommendations to further optimize customer services.

It’s fair to say that Big Data Analytics in the travel industry is growing exponentially. Creating and implementing a complex data analytics strategy is no longer a luxury that providers can ignore. The cost challenges of just storing all this constantly-flowing data are real but the reduced cost of storage technology make that even less of an issue. There are still significant infrastructure obstacles to be overcome and a shortage of analytics experts, but, as in so many other technological transformations, there’s enormous evidence that the early adopters of the best of this technology will be the winners in the digital travel revolution — that said, I think you should consider reading Bob Violino’s great article, “How to avoid big data analytics failures,” all about best practices “…to blow past the competition, generate new revenue sources, and better serve customers…”

[1] How Big Data Analytics is Redefining the Travel Industry, by G. Patil

Christopher Wolf Nordlinger

Written by

Ph.D. Fulbright Scholar. Marketer and Storyteller. Training. Cybersecurity. AI. IoT. Robotic Process Automation. Startups-ex-Cisco & State Dept

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