5 DIGITAL MARKETING LESSONS FROM THE TRAVEL INDUSTRY - Build loyalty, boost marketing ROI, and differentiate your brand by delivering firstclass ...
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TREND REPORT 5 D I G I TA L M A R K E T I N G L E S S O N S F R O M T H E T R AV E L I N D U S T R Y Build loyalty, boost marketing ROI, and differentiate your brand by delivering first- class customer experiences
U P A N D A W AY
Digital transformation has permanently grounded several time-honored industries, but travel
companies keep flying high in the friendly skies. In 2017, ravel sales worldwide reached an all-time
high at $1.33 trillion (J.P. Morgan) 1. And despite a shaky world economy, the industry is expected
to continue ascending at least above the 5 percent mark to reach $1.5 trillion by the year 2020.
Fueling this rise is a consumer shift - rather than spending money on things, consumers are
increasingly spending money on experiences. This trend is especially strong among millennials,
who at the moment spend a combined $200 billion on travel per year. Nine out of ten consumers
in this age group identify “seeking out new experiences when traveling” as their main motivation
(FutureCast) 2 .
When it comes to keeping these consumers satisfied, the travel industry soars above the rest.
In a Decibel Insights 3 survey on delivering a positive digital customer experience, the travel and
leisure industry came out in first place with a 62.5 percent success rating, well ahead of retail (53
percent) and telecom (25 percent).
So what is the secret behind this success?
It’s simple. The travel industry has prioritized customer experience from day one. Think about it:
A wreath of flowers draped around your neck as you step off the plane. Free shuttle rides from
airport to the hotel. Complimentary fruit-infused water in the lobby, live ukulele music noodling
somewhere in the courtyard. A mint chocolate placed on a crisp white pillow. A plush robe, organic
shampoo, and slippers. Free Wi-Fi and an array of on-site activities at your fingertips… time spent
traveling is rarely ordinary.
But then again, offering a positive customer experience is only part of the journey. Customers
still enjoy the experience of reading a book, for example, but look what happened to bookstores.
Marketers from all industries can take their customers to higher ground by taking notes from the
travel business. This trend report is your ticket.
1 http://totalaccess.emarketer.com/chart.aspx?r=215631
2 www.millennialmarketing.com/research-paper/the-millennial-brief-on-travel-and-lodging/#download-popup
3 http://totalaccess.emarketer.com/chart.aspx?r=201016
2
1 W H AT E N T I T L E D C O N S U M E R S
R E A L LY W A N T F R O M T R A V E L
EXPERIENCES
A journey of a thousand miles starts with a single step. And
all experiences in the travel segment start with the individual
consumer. The good news is that over the last 20 years, more
and more consumers are taking up a journeying lifestyle as
the number of international travel departures across the
globe doubled from roughly 600 million to 1.3 billion in 2017
(Deloitte) 4 . And spending on travel, leisure and dining is up,
while spending on consumer goods is down 5 .
The bad news is that consumers are growing increasingly
difficult to please. In the Age of the Entitled Consumer,
only the best experiences will suffice. Failure to deliver will
lead down a dark path of words that start with “un” (as in
“unsubscribe”, “unfollow” and “unlike”).
Demands can be high, and at times, bordering on
unrealistic. When asked about their most frustrating in-flight
experiences, 42 percent of US travelers named “No Wi-Fi”
(Acxiom) 6 as the biggest rankler. Ten years ago, in-flight Wi-
Fi was still in its infancy - now, it’s the birthright of entitled
consumers. The tolerance for failed experiences is also low.
It only takes a single negative experience for 49 percent
of US and UK consumers to switch hotel providers, and 41
percent to switch their airline (Lithium) 7.
Keeping these demanding consumers from jumping ship is
a full-time job. And it all boils down to knowing what they
want from their travel experiences in 2018.
4 http://deloitte.wsj.com/cio/2018/03/01/now-boarding-the-future-of-the-travel-hospitality-industry/
5 www.nytimes.com/2015/08/14/business/economy/stores-suffer-from-ashift-of-behavior-in-buyers.html
6 http://totalaccess.emarketer.com/chart.aspx?r=213213
7 http://totalaccess.emarketer.com/chart.aspx?r=206097
3
E N T I T L E D C U S T O M E R S W A N T T O…
Have full control over travel booking. Travel retail locations are among the
casualties of digital transformation as customers take charge: 72 percent of
internet users in the US now book their vacations online, compared to 50 percent
10 years ago (eDreams) 8 . Engaging these consumers personally across channels
on their path to purchase has become a focus for marketers (see Chapter II.).
Create experiences on the go. Mobile phones are the number one item that
today’s travelers bring on vacation (ETB News). The reason? To better control and
improve the trip experience. While 83 percent of travelers in North America book
their travel on desktops/laptops, 73 percent rely on their smartphone to make
travel arrangements during the trip (Expedia) 9.
Receive custom-tailored travel advice. Travelers want to be addressed using
their preferences and are willing to fork over personal data in return. 63 percent
of millenials in fact expect this of travel companies they work with (Acxiom) 10 .
For better and more relevant experiences, 83 percent of millennials would allow
travel companies to track personal habits and behavior (American Express).
Score the best deal. Consumers may be more focused on experiences but they
still want the most bang for their buck. In the 27-to-34-year-old demographic,
72 percent of consumers want the cheapest flight or hotel possible (Acxiom) 10 .
Ultimately it impacts the way consumers shop: the typical traveler now visits an
average 4.4 websites before booking – actually a sharp drop from 38 sites in 2013
– and frequent familiar vendors (Fuel Travel) 11.
8 http://totalaccess.emarketer.com/reports/viewer.aspx?r=2002133
9 http://totalaccess.emarketer.com/chart.aspx?r=210175
10 http://totalaccess.emarketer.com/reports/viewer.aspx?r=2002133
11 http://hotelmarketing.com/index.php/content/article/number_of_sites_leisure_travelers_visit_before_booking_drops_by_88
4
Share experiences on social. Joined at the thumb with their smartphones,
76 percent of social media users ping their network with status updates and
vacation photos (Webbed Feet). This trend has also reshuffled digital marketing
budgets: In 2017, Snapchat was first in digital ads, rated “extremely influential” by
67 percent of US travelers, followed by Instagram (63 percent), and YouTube (58
percent) according to Phocuswright12 .
Claim free goodies. Everybody likes free perks – and 77 percent of today’s
travelers will even base their booking decisions on the free amenities offered
(Tripadvisor). Topping the wishlist, is free in-room Wi-Fi at 74 percent; free
breakfast at 60 percent; and free hotel shuttle service at 58 percent. Here’s some
advice: at many hotels, these gratis goodies are already baked into room prices.
Plan big vacations in advance. Travel experiences are a big deal and an expense
for many, so most travelers plan in advance. Booking more than 60 days in
advance is the preferred time window for 40 percent of US travelers (Sojern) 13 .
Taking this timing into consideration, the most successful marketers schedule
their retargeting accordingly (see Chapter II).
HOT TREND: HAVING FUN ON
BUSINESS TRIPS
Business travel is projected to grow 6 percent this
year (GBTA) 14 , as professionals increasingly factor
leisure time into their yearly plans. The new “bleisure”
trend – a blend between business and leisure – now
represents 43 percent of business trips in the United
States (Expedia) 15 . Travel providers are catering to
customers who want to load their itineraries with
business in the front, party in the back.
12 http://totalaccess.emarketer.com/chart.aspx?r=216681
13 http://totalaccess.emarketer.com/chart.aspx?r=204900
14 www.gbta.org/foundation/pressreleases/Pages/rls_0711162.aspx
15 https://cdn2.hubspot.net/hubfs/149354/Content_Docs/Premium_Content/Bleisure_2016_FINAL.pdf?t=1520972429976
52 T H E N E W M A R K E T I N G T ECH N O LO G I E S
G I V I N G T R AV E L I T S W I N GS
Travel did not become the world’s most customer-centric industry by following an antiquated
road map. The onwards and upwards shift towards digital travel retail is a textbook example of
mastering digital disruption. It’s earned near-constant, year-on-year sales growth in the double
digits; with worldwide online travel sales poised to grow 10.4 percent from $612.9 billion in 2017
to $676.4 billion in 2018 (eMarketer).
Like anything in the marketing industry, this fundamental transformation requires an ongoing
commitment. The US travel industry will increase its digital ad spending by 8.1 percent to $8.65
billion in 2018 and spend $13.13 billion per year by 2022 (eMarketer)16 . Beyond advertising, travel
companies are also committed to enlisting the latest marketing technologies for an extra boost.
Here’s a sample of the latest tech giving travel companies wings:
Artificial Intelligence
Now that 72 percent of US travelers book their trips online, travel companies need help to
make sense of all that data. Enter artificial intelligence (AI) engines that crunch terabytes of
data per second. AI connects intelligence from customer data platforms (CDPs) – meaning
customer behavior, purchase history, and demographics – with retail inventories and business
policies. Next, machine learning-algorithms create predictive offers, individually tailored
towards individual customers. Distributed via omnichannel solutions like Selligent Marketing
Cloud, predictive offers bring one-to-one personalization into emails, websites, and push
messages.
Voice technology
“Alexa, I need new towels quick!” In December 2017, Wynn Resorts became the world’s
first hotel company to install Amazon’s Alexa-powered Echo devices, starting at its flagship
property the Wynn Las Vegas. Other hoteliers are still on the fence, with many testing out
devices and platforms, but it’s clear that the travel segment is wisely preparing for a tectonic
consumer shift away from smartphone dependency. Experts at Gartner17 predict that by 2020,
30 percent of web browsing sessions will no longer happen on screens, but rather via voice
technology. By 2020, it’s estimated that 50 percent of all search queries will instead originate
from voice commands (ComScore) 18 . Now, what’s taking these towels so long?
16 https://numbers-na1.emarketer.com/5911ed31aeb8830e3829e27b/5851918b0626310a2c186b4e
17 https://www.gartner.com/newsroom/id/3482117
18 www.forbes.com/sites/forbesagencycouncil/2017/11/27/optimizing-for-voice-search-is-more-important-than-ever/#14b0ac6b4a7b
6Augmented Reality (AR)
The massive success of AR-game Pokémon GO opened a world of possibilities for travel
companies. Ultimately, Pokémon hunting is all about the journey, enhanced by digital location
markers and on-the-go storytelling. Major hotel chains and travel providers are testing AR
applications in time to ride a bigger wave: Statista19 expects over 200 million consumers using
AR-content by 2018. The entire marketing industry is allocating resources accordingly and 25
percent of marketers currently plan to invest in AR technology (Yes Lifecycle Marketing) 20 .
Geofencing and location-based marketing
“Welcome to the islands,” whispered the push message. Travel marketers rely on triggers
from NFC, beacons, or smartphone GPS to welcome travelers at their destination with real-
time notifications. They send situation-specific offers based on location, upgrades at special
rates or individual perks for check-ins. Consumers are looking at their smartphone anyway,
especially on vacay. Once they arrive at their destination, 73 percent of US travelers use their
phone to check hotel reservations, 71 percent navigate a downtown area, and 66 percent find
attractions (Colloquy) 21. Geo-optimizing your brand is money well spent, as more than 30
percent of all searches are already based on location (Google).
Automated driving
The airport shuttle of the (near) future may well drive itself. By 2020, 10 million driverless cars
will be on the road and by 2040, over 95 percent of all new vehicles sold will be autonomous
(Forbes) 22 . A public secret maintains that a fleet of driverless cars is Uber’s real endgame.
Automation is also coming for jobs in supply chain and luggage handling, while service
infrastructure increasingly relies on AI-powered chatbots (see Artificial Intelligence).
Good old human interaction
Despite the imminent rise of the (chat)robots, the travel experience will forever rely on a
human component. This is especially true for spontaneous purchases such as tours and
attractions, where 45 percent of transactions happen offline (Phocuswright) 23 in face-to-face
interactions. But whether its offline or online, the best travel providers are able to identify
their customers instantly, thanks to rich consumer profiles from customer data platforms (see
Chapter III.). Based on this data, concierges can serve personal recommendations, a smile,
and (depending on your hotel) a fresh-baked chocolate chip cookie.
19 www.statista.com/statistics/282453/mobile-augmented-reality-market-size/
20 www.prnewswire.com/news-releases/report-marketers-set-sights-high-on-innovation-in-2017-300394328.html
21 http://totalaccess.emarketer.com/chart.aspx?r=197523
22 www.forbes.com/sites/oliviergarret/2017/03/03/10-million-self-driving-cars-will-hit-the-road-by-2020-heres-how-to-profit/
23 www.trekksoft.com/en/blog/4-key-trends-to-watch-for-this-year-according-to-phocuswright
73 F I V E D I G I TA L M A R K E T I N G L E S S O N S
F R O M T H E T R AV E L I N D U S T R Y
While the travel business always keeps a finger on the pulse of new tech, it also remains focused
on its core commitment: Customer experience is still a “vital part of marketing” according to
56 percent of destination marketing organizations (TrekkSoft) 24 . Investing in experiences will
also directly impact the bottom line of businesses in any industry, not just travel: According to a
Forrester Research 25 study, leaders in customer experience achieve an average 17 percent revenue
growth over the course of five years. Companies with poor customer experiences reach 3 percent
growth, at best.
So, what makes the travel industry number one in serving experiences that have customers
coming back?
I Lesson 1: Treat your customers like family. The hotel concierge who gets the largest tips is
the one who knows customers by name. Travel companies were among the first to see value in
getting to know their customers just as well online. In an Amadeus survey conducted five years
ago, 43 percent of travel companies named “targeting and personalization” as priorities in digital
strategies. Since then, rich customer databases have unlocked personalized offers that punch
well above their weight class: A Google/Phocuswright 26 study revealed that 55 percent of leisure
travelers only take two vacations per year at most, planned out well in advance. But presented with
an attractive promotion, 30 percent would book a trip spontaneously, and 25 percent would even
visit an unfamiliar destination. Mer Montagne Vacances (MMV), one of the leading hotel operators
in the French Alps, leverages cross-channel data with Selligent to get a 360-degree customer view
and automate personalized messages, resulting in improved customer experiences and repeat
bookings.
II Lesson 2: Find opportunities to upsell and cross-sell. Purchasing a vacation is the gateway to
making more follow-up purchases, including rental cars, insurance, all the way to restaurant
reservations or better accommodations. When it comes to serving tasty cross- and upselling
prompts, predictive offers powered by artificial intelligence (AI) make a world of difference.
Fed with data on customer history and current location, these machine-learning algorithms
generate personalized offers for every single customer – including upgrades on current room
arrangements, equipment rentals or on-site activities at attractive prices. On that note, activities
have seen exceptional growth over the past years and now constitute one-third of the travel market
at $129 billion in 2017 (Phocuswright) 27. Most activities are impulse buys while on vacation, with 53
percent booked within one week in advance, so the right offer at the right time may seal the deal.
Working with Selligent, IHG (InterContinental Hotels Group) boosted conversions and cut costs
with dynamic reservation confirmation emails, populated with individualized, custom offers and
delivered to each recipient following a booking.
24 www.trekksoft.com/en/library/research-report-remaining-relevant-as-a-dmo
25 https://econsultancy.com/blog/68069-customer-experience-drives-revenue-growth-but-marketers-lack-cx-skills/
26 www.thinkwithgoogle.com/marketing-resources/micro-moments/travel-research-micro-moments/
27 www.trekksoft.com/en/blog/4-key-trends-to-watch-for-this-year-according-to-phocuswright
8III Lesson 3: Build brand value with rich storytelling. The market landscape in travel is not what it
used to be. “Alternative” rental portals such as Airbnb have taken a big shark bite out of the profits
surfboard, and now are the preferred accommodations for 15 percent of travelers worldwide
(momondo) 28 . Hotels still command 57 percent of the market, but need strong brand power
to stand out among price-driven competition. According to TrekkSoft 29, leading destination
marketers rely on a “digital and content-first strategy” to build “emotional and inspirational” brands
based on experiences. Leading hotel chains enlist social media influencers and experiment with
virtual reality content, while keeping customers coming back with loyalty programs (see Lesson
5). Boutique hotels such as ACE Hotel and SOHO House partner with carefully curated lifestyle
brands to drive branding synergies, while also hosting company events to show “bleisure” travelers
(see Hot Trend) a good time.
IV Lesson 4: Get customers to talk about you. Location sure goes a long way in making a resort or
hotel attractive. But word of mouth among customers can be a major deal breaker, for instance
when that lux resort gains a reputation for being unaccommodating to families with children.
Today’s marketplace is a reviewers’ world, travel companies just live in it. That’s why online
travel booking sites, including Selligent customers MMV, IHG, Bookit, and Neckermann actively
encourage customer reviews, which have surpassed magazines as the golden standard in decision
making. Over 95 percent of leisure travelers read at least seven customer reviews, spending 30
minutes on average, before completing a booking (Tnooz) 30 . Bookit uses Selligent’s survey system
to automatically trigger follow-up survey invitations asking travelers to share their experiences
and score all destinations. In return, customers receive loyalty points with every booking or survey
submission to keep the cycle of book-travel-review going.
V Lesson 5: Reward loyalty. Great to see you again. In the age of Entitled Consumers and fleeting
brand loyalties, the travel industry is achieving the rare feat of keeping customers coming back.
Why? Because it boasts the most incentive-rich loyalty programs: In the millennials age group, 90
percent of US customers book cruises through a loyalty program, 83 percent book airline travel
and 78 percent hotels (AARP) 31. Selligent customer IHG manages the world’s largest hotel loyalty
program with 52 million members, and boosted email marketing performance with dynamic
content and one-to-one messages based on recent activity. Regular check-in from hotel brands
resonates with customers: In an Acxiom study, 42 percent of 20-to-26-year-old like to be contacted
by travel companies after their trip. Keeping in mind that December is peak booking season for
summer travel, Selligent customer Neckermann used rich customer data in an omnichannel Fall
campaign to boost repeat bookings.
28 http://totalaccess.emarketer.com/reports/viewer.aspx?r=2002133
29 www.trekksoft.com/en/library/research-report-remaining-relevant-as-a-dmo
30 www.huffingtonpost.com/entry/digital-trends-that-are-transforming-the-travel-industry_us_58c6cc3ae4b0c3276fb78790
31 http://totalaccess.emarketer.com/chart.aspx?r=214977
9O U T LO O K
Marketers from all industries can go the extra mile by taking a note out of the travel biz playbook.
The companies leading the way are the ones who can follow their customers at every step along
their real and digital journeys. They are also the ones who know their customers better and better,
by drawing on rich data from integrated customer data platforms.
Combining real-time insights from travel booking, website behavior, social media, customer service
interactions, and current location data not only allows marketers to serve relevant messages – any
time, any place, on any channel. It’s also the key to creating long-term customer journeys, one
perfect trip at a time.
10
10ABOUT SELLIGENT
MARKETING CLOUD
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enables B2C brands to engage consumers across all critical channels.
Built for the relationship marketer, Selligent Marketing Cloud is the
only marketing cloud built on a single code base, featuring artificial
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More than 700 brands across retail, travel, automotive, publishing, and
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With 10 offices across the United States and Europe and more than 50
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Learn more at www.selligent.com and connect with the team at Twitter,
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11NEW YORK | 1 Whitehall Street, 19th Floor | New York, NY 10004
@Selligent
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