Frequent stays and in-person interactions have long been the standard building blocks for traditional loyalty programs. As travel experiences blend with the digital, contactless world, hotel brands must sharpen their abilities to gather first-party, personalized data from customers throughout the journey.
The onset of the pandemic accelerated digital transformation for travelers and brands alike. With travel disruption grounding even the most loyal brand advocates — particularly in the business travel sector — brands have had to rethink how they use data to acquire and retain customers.
“In the past, hotel loyalty programs were centered on two main data sources: frequent stays and in-person interactions,” said Jeanne Jones, vice president of community and customer marketing, at Amperity. “Today, it’s important to have the ability to create experiences in a digital format and track that among all the new platforms and touchpoints. If you’re not set up to organize that, you’re going to be left behind.”
Entering a new era of travel, the importance of proprietary, personalized, first-party data can’t be overstated. As a prime example of executing in this new environment, Wyndham Hotels & Resorts is leveraging its revamped customer data platform using Amperity to engage its loyal customers and build new relationships with similar, though perhaps less familiar, travelers.
Digital Data Is Upending the Traditional Loyalty Model
Data consistently shows that only about 40 percent of travelers are in a loyalty program, and a recent Skift Research survey discovered that even fewer (32 percent) were in a hotel loyalty program. This means that well more than half of any given hotel’s customers are going to be left out of data sets that are exclusively focused on members. At face value, that gap is massive. Due to trends brought on by the pandemic — some of which may be fleeting, and some that may be here to stay — that gap is growing.
For example, at least at the moment, people are traveling less frequently than they may have in the past. However, when they are traveling, they’re planning bigger trips. According to 360 Market Reach, 40 percent of consumers said they expected their next vacation to have a higher price tag than what they would have tolerated in the past. Travelers ages 18 to 34 indicated they planned to spend up to 50 percent more on average.
Furthermore, given customer preferences and technology enhancements, contactless experiences are becoming more prevalent. While this is improving the guest experience in many ways, that means fewer face-to-face interactions.
“Every touchpoint is super crucial because you have less frequent interaction, and the interactions are moving away from in-person to digital,” said Jones.
As experiences blend with the digital, contactless world, building a complete profile and picture of each individual traveler has become more complex. Therefore, the ability to gather behavioral information of loyalty and non-loyalty customers from booking data, point of sale data, third-party distribution systems like online travel agencies, and more, has become more critical as well.
“It’s very important to us to understand first-party data because it tells us who our guest truly is,” said Danielle Harvey, vice president, customer intelligence and media, at Wyndham Hotels & Resorts. “By bringing all of those disparate data points into a centralized place, we can understand the way they engage with us, when and why they stay with us, and pull all that together into a profile that better informs personalized marketing strategies.”
A Blueprint to Reimagine Customer Data Collection
Wyndham has been on a digital transformation journey for the last several years, and like any successful effort, a meticulous, intelligent plan for a new customer data program met with a little bit of luck along the way.
Harvey noted that her team started implementation of a new customer data platform with Amperity in early 2020 just before the pandemic, and they were able to push through and launch in the middle of the year. This timing meant that they were ready to shift and personalize messages to customers even though everything was changing so fast due to Covid-19.
“Our program allowed us to pivot our marketing really quickly to where we were not trying to create demand, but shifting to where demand existed,” Harvey said. “We found out that a lot of our customers were still traveling and still comfortable doing so, and it became a matter of making sure we were top of mind when they were ready to do that.”
As a result, their approach to marketing became customer-led and audience-focused. By optimizing digital marketing with their first-party data, Wyndham saw up to a 60 percent improvement in conversion rate and up to a 35 percent reduction in media costs in a six-month period from January to June 2021.
“Digital transformation can sometimes feel very overwhelming. Many people feel like they have to change everything they do and come up with brand new things,” Harvey added. “By using our data to better inform audience-led marketing strategies, we were able to improve our results in increments, testing and learning into more effective practices while delivering a better guest experience.”
Start With the Right Building Blocks
While the outcomes of successful case studies like Wyndham’s make everything sound easy, there are a number of important choices to be made about data acquisition on the front end that have huge implications on the entire process.
“Part of any onboarding experience with a new customer involves looking at their data and taking inventory, and aligning first uses, such as whether it’s an analytics use case or a marketing use case,” said Jones. “Focus on bringing that data in and making it usable, then take an iterative approach to it so that you’re getting value out of it as quickly as possible.”
As travel brands collect and parse customer information provided directly to them, they can start to see an immediate impact on customer loyalty initiatives. With the ability to identify how customer behaviors are changing over time, how people are moving between segments, and how their habits may be shifting, technology is helping hospitality become even more personal.
“Travel is a human experience, and without the full view of the human, those interactions are going to be missing something,” Jones added.