Experimenting with data could transform travel agencies, says Pascal Clement, Amadeus head of travel intelligence
Big data is impacting every industry and changing the way business works as a result. Customers are beginning to expect more from companies, led by their experiences with the retail industry where many companies use data to provide a more personalised experience.
The travel industry is not exempt from this. Travel agencies – and travel providers in general – need to embrace data as a way to meet the needs of the changing market.
Data analytics has become a vital technology for businesses looking to better understand their market and customers.
Because it is relatively new, there is a necessary element of experimentation but, by investing in the power of data, travel agencies will be in a better position to compete effectively and provide enhanced customer experiences.
Just like any other business, travel agencies are focussed on their bottom line. Managers prioritise growing revenue – often through sales growth, but also by improving business margins and increasing productivity.
Technology plays a key role here, and data analytics can have a substantial impact on an agency’s efficiency and revenue.
However, many agencies struggle to see how to use this technology, and the biggest challenge is often making sense of the data they already have.
Analytics tools offer many ways to gain actionable insights from the information agencies naturally gather.
For example, reservations and booking data can be combined with flown data to highlight opportunities to improve business performance and arm travel agents with better information about revenue per ticket. This will allow them to more accurately negotiate contracts with airlines.
The agency can also benefit by analysing data on individual agents’ work. This allows managers to identify training needs and align staff with activities that best maximise overall agency productivity, resulting in increased efficiency and revenue.
Data analytics can support an agency in ways that reduce costs and improve operations without lowering quality of service, freeing up agents to spend more time building relationships with customers.
Attracting new customers and encouraging loyalty from existing ones is key to success in today’s market.
A 2015 study revealed that among booking channels, word of mouth is most important to travel agents: 37% of those surveyed selected an agent because of a friend’s recommendation.
There are many ways to provide a positive experience to customers using data already available. For example, travel agencies can analyse searches and bookings to identify patterns.
This information can be used to tailor offers and advertising strategies based on expected demands – for example, by knowing that flights from Paris to Marrakesh are less popular in the winter, travel agencies can negotiate lower prices and advertise the route to French customers to stimulate demand.
Similarly, if a route has increased in popularity, agencies can generate an offer to encourage people to book through them.
Travellers could also opt to allow agencies to recognise their social media activity, identifying certain locations they may like to visit due to a music festival or other event. Based on this data, the agency could offer a personalised promotional bundle and win customer loyalty.
Agencies need to evolve their offerings to support travellers’ changing requirements. There are myriad ways for travel agencies to use data, both to improve relationships with customers and to make operations more productive. Each agency needs to see what method works best for them.
To thrive in today’s quickly evolving marketplace, experimentation is key. The industry is posed for rapid innovation. Now, more than ever, travel agencies need to learn how to best serve their customers in a cost-efficient manner.
New ways of working mean agencies must be willing to try new strategies even in the knowledge that some will fail. Analysing data – whether the agency’s own or information from third parties – is the way forward.
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