Insights

How Big Data Analytics is Helping Hotels Improve Guest Loyalty

The hotel and hospitality sector caters to millions of travelers every day, and each one of them checks in with their own set of expectations. Exceeding those expectations is the key to getting people to return, and advanced analytics solutions can provide increasingly sophisticated insights by predicting those expectations very early in the customer journey. This can help empower hotels to pro-actively keep their customers happy.

There is an emergence of a new generation of sophisticated loyalty programs that are driven by highly granular data, consumer behavioral pattern analytics, and deep business intelligence insights. This ultimately leads to travelers seeing the right message at the right time and at the right price.

Historically, loyalty programs were designed to reward customers with special offers, treats, and discounts in the hope of retaining their business and encouraging customers to spend more frequently. While there is still some truth to this, our experience in the industry shows that some CRM systems are starting to become increasingly sophisticated and are being utilized with powerful effect.

A good example of this, is Marriott. According to Forbes, Marriott uses Big Data technologies across its hotel chain operations. Unstructured and semi-structured datasets, such as weather reports and local event schedules, are used to forecast demand and determine a value for each individual room throughout the year. Integrating this big data with people’s beliefs could further allow Marriott to create segments of one, further personalizing their marketing efforts.

This enables the chain to set prices with optimum efficiency. This is vital in an age when customers are used to saving pennies by scanning price comparison services for the best amenity package at the best price point. In this intensely competitive industry, it’s become increasingly important for hoteliers to use an array of 3rd-party data sources including Social Media, Review Data, Search Engine Traffic, as well as cross-industry customer data like Telecommunications, Weather/Airport Data, Competitor Performance Data, and more, to stay ahead of the competition.

This entails undertaking a technology-intensive data integration exercise that will give a holistic view on a customer’s behavior, their search process, their feedback, and location. In turn, this helps create lead-generation analytical models that will allow hoteliers to personalize their marketing efforts towards each traveler.

Currently, despite 40% of travelers being loyal to the same hotel brand for their trips, only 1-in-4 travelers have a hotel loyalty card, suggesting there is still more work to be done by most hotel groups. 

Hoteliers deal with two potential scenarios when it comes to attracting customers. The first is when the customer researches for a hotel that offers the best value at the best price. The objective for hotels is to generate good quality leads for acquisition, which has a direct impact on their revenues. The second is when hoteliers aim to provide a memorable customer experience to their guests during their stay, which makes them likely to return and potentially recommend to their friends as well. The objective in this scenario is to pro-actively predict the CX drivers and react in real-time to be able to deliver enhanced customer experience. This would result in optimizing service efficiencies and cost, as well as a longer-term impact on revenue with a higher proportion of returning customers.

However, a recent travelers survey, conducted by The Engine Group, amongst 3,000 representative respondents across Hong Kong, Singapore, and Australia, has revealed that among the travelers with a low loyalty level to hotel groups, the top 3 reasons cited for their low loyalty are: ‘Value-for-money’, ‘Hotel service not personalized’ (therefore no benefit of using the same hotel group), and ‘Convenient location’.

Analysis of Brand Loyalty Drivers

To understand what travelers are seeking experientially, hoteliers need to be present where travelers are present the most: online. This makes it even more imperative for hotels to create a 360-degree customer view that integrates 1st-party as well as 3rd-party data sources.

In terms of creating memorable customer experiences, hoteliers have traditionally relied on internal CRM data. This includes a traveler’s details like country of origin, destination country, time of booking, booking channel, length of stay, campaign data, and operational data. This has some merits, but limitations as well.

Mining through internal CRM data to identify drivers of customer experience tends to be late in a customer journey. Hoteliers need to ensure a seamless experience starting from when the customer researches hotels to when the customer stays and ends their stay with the hotel.

Advanced analytics techniques help analyze your customer’s behavior and actions in real-time. This helps identify drivers of customer experience and, most importantly, weigh the drivers that enable hoteliers to simulate the impact on customer experience by investing their time and effort into improving the drivers.

For example, a customer that visits your hotel restaurant on a frequent basis due to business, could be targeted during your next promotional campaign with a personalized email saying, “We know you have enjoyed our great restaurant in the past, so when you visit next week, here’s a coupon for a free appetizer and drink.” Technology advancements have enabled hotels to automate this process and deploy an effective and personalized cross-channel marketing strategy in real-time.

While it is imperative to deliver good experiences, it is equally important to take necessary actions in case of bad customer experiences. Integrating the identified CX drivers with CRM has enabled hoteliers to react in real-time and pro-actively reach out to customers with the relevant messaging and closed-loop feedback, even before the customer decides to act on it.

Customers leave a data trail from the moment they book to the moment they check out. Engine Connect enables hotels to integrate these disparate data trails and turn them into actionable insights that drive business outcomes. Engine leverages its Media Exchange platform, EMX, to activate the insights and help advertisers buy media from its extensive network of publishers in a cost-effective manner, maximizing ROI for all. With over 20 billion daily consumer touch points, whether you’re a publisher, advertiser or agency, EMX offers reduced waste, high-quality inventory, precision targeting, full transparency and increased ROI.

Learn how Engine can help increase your customer loyalty.

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