Andy Owen-Jones from Travel Weekly’s Spring Forum sponsor bd4travel tells delegates how they should ‘throw out the rulebook’ for the travel recovery.
Travel businesses must ‘throw out the rules book’ and embrace precision retailing as they compete for bookings when the travel rebound happens.
Andy Owen-Jones, founder and chief executive of specialist data analytics and e-commerce firm bd4ravel, told this week’s Travel Weekly Future of Travel event that firms must give themselves options in an uncertain world.
He said the neat future is likely to see countries “dance” with the COVID-19 virus as it becomes endemic to suppress new outbreaks meaning the future will be unpredictable as things are closed and re-opened.
And he said, while some of the changes seen during the pandemic will be a blip others will change aspects of how business and consumers operate forever.
Six things to think about to prepare for the future
He said there are six areas firms should look at the prepare themselves for the future:
- The customer is king – first party data will dominate;
- Think about your entire audience, not just the people who buy;
- Get into precision retailing;
- NDC [New Distribution Capability] is really only half the equation;
- If you’re serious about transformation measure different things;
- And finally, throw away the rules.
“None of us actually know quite what comes next. We know that there has been a downward blip in traffic.
“The question is, is this an inflection point that’s going to last for a long time. Has something structurally changed, or is this just a blip…a bit like the SARS event.
“Some things, we think, will be structurally different going forward…but also I think some of the value chain elements are going to be more expensive.”
Owen-Jones cited new airport fees, seat configuration in aircraft due to a drop off in business travel, and cruise lines operating at 70% capacity as examples of significant changes that are both challenges and opportunities.
He said firms facing uncertainty must “buy themselves some options”. “You need some space to move when you don’t really know what’s going to happen. The best thing is to put options in place you can do something with.”
How the cookie crumbles
He said: “We know that the third party cookie is under threat if you want to bring someone to your site.
“If you want to pay for them to come to your site, you’re going to have to find ways that don’t just rely on third party marketers.
“It’s going to get harder to acquire people, but when they come in you really need to encourage them to share their data with you.
“What is it about your value proposition that’s going to get people either to log in or give you permission to personalise their site?
“We’re going to have to think through an awful lot more ways of making the experience much more tangible for them in terms of if I share my data with you, what do I get by way of exchange.
“The second thing which is related to that is you have to think of the entire audience and not just those who buy.
“If you’re only thinking of the 2%, 3%, 5% of people who buy, you’re missing the 95% of the audience who are closest to buying, but who haven’t.
“If you only get feedback or data from your customers, you will leave most of your audience cold.
“The vast majority of interactions between your customers…comes from people who haven’t bought.
“But that doesn’t mean there aren’t learning opportunities when they look at products, when they choose between them.
“If you really try and understand how people are interacting with your product, then you can learn stuff.”
Owen-Jones said traditional Customer Relationship Management [CRM] approaches are often too slow to react to customers, particularly as COVID has made much historic data out of date.
“What we’ve seen, particularly working with the larger airlines is, they struggle to really do real-time personalisation, based on CRM.
“By the time you dive into the CRM system to pull back that person’s data, that person has moved on to the next thing.
The CRM time machine no one has
“You kind of need a time machine, if you’re going to support them through real time stuff if you’re basing it on CRM.
“And most of the data that people have collected over the last 15 to 20 years, is currently not very meaningful.
“What’s really interesting is what is surfacing now, what people are looking for right now and how to start interpreting that. We call this precision retailing, and this is going to be really important.
“One of the reasons we started our company was we felt people were not precise in what they were putting in front of people.
“They didn’t have the ability to put the right experience in front of the right customer at the right time.”
Owen-Jones said firms must start thinking differently about how to measure their audience’s propensity to book and understanding the customer base.
And he said Artificial Intelligence aligned with more traditional business intelligence will strike the right balance between established business rules and adapting to the market.
“You need to be able to create a hypothesis about what’s going on, put those into your AI and let the AI work with that,” he said.
“The ability to put the right experience in front of the right customer at the right time is really, really important and we don’t think it’s ever been so important as it is now.
“It’s going to get harder if you have to pay for people, to see them disappear off without buying when actually there’s a very limited range of customers.
“Are you in control of what you’re putting in front of people?”
The flexibility of product offered by the emerging NDC data standard is only half the equation that must be aligned with understanding the customer.
“You’ve got to make products flexible, we completely agree with that, but understanding customers is where value starts.
“Too often, particularly in the travel technology world, we’ve started with a technology or we’ve started with a product and tried to find ways to distribute that product.
“The very word distribution, which is at the heart of our travel technology, implies that we’re not really understanding what customers are after.
“One of the other things we’ve learned over the last year, in particular is that if you’re really serious about transforming you need to measure different things.
Getting smart with AI
“So we’ve really challenged ourselves over this period, to come up with new metrics.
“If you’re really serious about changing the way you do business, I challenge you to look at what you measure – see if you can measure things better.
“We’ve challenged ourselves to measure things like what’s the value of our audience, what’s the lifetime value of people who come to a system, how do we truly attribute things to different channels to different interventions, rather than making up guesses.
“Too many people are talking about getting personalisation working or getting dynamic systems working, which is based only on putting things into the rules-based systems.
“Instead of having rules, what you want to be able to do is put a hypothesis out that you can test with the support of AI. You need AI to do some of the heavy lifting.
“Part of the big challenge we’ve all got to face is how do we bring together the institutional knowledge in airlines, OTAs and tour operators and put that together with smart AI so that the AI doesn’t obliterate those rules but complements it, to make things much, much better.”