Bits and Bytes of Reinventing the Asian Travel Industry
The days of pre-planned, well-calculated vacation packages are coming to an end. For travel brands, it is disrupting their traditional business models. Travelers want more personalization, unique experiences, and better control over their itineraries. The clues to answering these diverse and complex requests lie in data. We asked Irene Lee, commercial director, North Asia, ADARA how new data-driven trends are shaping the travel industry, and why every travel brand needs to begin with data.
How has digital completely changed travel?
Lee: Digital solutions provide access to unfiltered experiences that inspire travelers. In the past, travel agencies existed to do vacation planning for consumers. With digitalization, consumers are actually not only empowered but have shown greater interest in planning their own trips because it provides them with more freedom and control over what they want to do at the destination, in line with their interests, preferences, and habits. They need not follow a set itinerary and have the flexibility to make changes to their plans even when they are at the destination itself.
For a consumer, a quick search online will quickly inform them of suitable flight routes, the best hotels to stay at, places of interest to visit, etc., through travel bloggers, social media posts and dedicated travel websites. These quickly provide them with a broad understanding of the destination and give them ideas of what they want to achieve out of their trips.
In comparison with reviews on social media, which are often sponsored posts by influencers, consumers have indicated that they trust blogs and travel websites more as these give a more authentic view of a place and experience. Being exposed to the authentic experiences of fellow consumers helps travelers to better plan, as well as to set and manage their own expectations before embarking on their trips.
For consumers, social media is all about networking, and following people that inspire them. Through the various social media platforms, consumers are in a better position to be more engaged when planning for their trips. Instead of relying on the inputs from a single travel agent, social media provides them with access to other sources of information available on the internet, whether it is curated by a friend or through third-parties.
How has the travel industry responded to digital-driven disruptions?
Lee: As mentioned earlier, the travel industry has been adopting new technologies to keep up with digitalization, which fundamentally aims to provide efficiency, authenticity, and personalization. The travel industry has been responding well to the change, with travel brands increasingly turning to data to drive their services, offerings, and even marketing efforts, all to address customers' needs and wants.
A challenge for the travel industry is that only a small percentage of customers will engage with a single brand at the levels where that brand can adequately personalize their interactions. So even with the most modern technologies, it will always be a challenge to unlock consumer preferences because the data-set is incomplete. This is where a data co-op like ADARA can help fill the gaps with access to data from more than 200 global travel brands. We see more than 850 million traveler profiles every month.
ADARA has developed scores such as our Traveller Value Score and propensities that are being used in the market. These scores help determine potential customer lifetime value and help travel brands determine who is most likely to become a customer, which brands are most suited to them and ultimately, how valuable a customer they could be. Travel brands can use these scores to supercharge their CRM systems, enhance response rates to campaigns, upsell customers on experiences, and deliver a better customer experience all around.
Are there unique travel trends from Asia that are shaping global travel?
Lee: Personalization is becoming increasingly crucial for Asian digital travelers. Asian travelers, particularly millennials, are showing greater receptiveness to sharing their personal data in exchange for personalized experiences.
They are also willing to pay more for a personalized experience. While personalization is often done during the booking process, more can be done throughout the entire path to purchase, from pre-purchase to post-purchase experiences.
What should the travel industry look like in the future?
Lee: We are seeing several trends such as the rise of millennial travel, growing demand for sustainable travel experiences and the flourishing “bleisure” (business and leisure) segment. While the trends may keep changing, the common thread is the need to provide customers with personalized and relevant offerings.
As the industry is moving towards building more sophisticated personalization experiences, two main components are needed:
- Deep level insights about the traveler
- Machine learning capabilities to predict travel behavior
The travel industry of the future will, without a doubt, be heavily reliant on technology. While data itself is powerful, it is imperative that it is understood in the right context. Technologies, such as predictive traveler intelligence and AI are already starting to show promise with their abilities to capture behavioral inputs and to also contextualize data. They aim to improve travel service offerings that are tailored to every individual consumer.
A lot of technologies are focused on consumer travel. But how is business travel changing as a result?
Lee: Technology has fundamentally transformed business travel, right from the get-go of planning the trip, to the journey itself.
Business travelers are always looking for more convenient ways to improve their travel experiences, with many having shared that during the planning process of a business trip. They prefer relying on technology versus interacting with a travel agent or relying on an admin, as it is more efficient and reliable.
Travel technology has, therefore, evolved to be able to provide business travelers with the required resources and information at the tip of their fingers, while they are on the go. Business travel also becomes more seamless as technology has made it possible for travel brands and Online Travel Agencies (OTAs) to not only simplify the booking process but to even predict what business travelers are seeking out when they plan their business trips, based on past behaviors and preferences.
