Lars Formanek, senior strategy consultant EMEA at marketing firm Acxiom, believes a shift in how the industry collects customer data could present a huge opportunity for those who adopt the right strategy
The travel industry is set for a fundamental shift in how it collects customer data, presenting a huge opportunity for those who adopt the right strategy.
From next year, travel brands will no longer be able to rely on third-party cookies to target customers and will need to gather their own first-party data, with Google set to abolish third-party cookies in 2024. This means targeted advertising on other websites will no longer work in the same way as before.
First-party data is data that companies collect directly from their customers, such as their purchase history, website behaviour, and preferences.
While the decision to remove third-party cookies may seem restrictive and limit the ability of travel companies to target customers, it offers a significant opportunity for travel brands to reach and engage customers more effectively.
By leveraging first-party data, companies can gain insights into what their customers are interested in, where they like to travel, and what types of experiences they prefer. The travel sector already has access to a wide variety of data, such as purchase patterns, reason for travel, sales affinity, food and beverage preferences, and which channel customers prefer to use when making bookings. Most of this data can then be modelled and applied to give holidaymakers more personalised offers and allow travel brands to create more effective marketing campaigns that are more likely to resonate with their customers.
Given the post-pandemic rebound in many markets, which has spurred competition for travel audiences’ attention to an all-time peak, personalisation is a critical differentiator today. This is particularly the case in the awareness and conversion phase of the marketing funnel.
The move by Google to abolish third-party cookies is a game changer for travel brands, the vast array of opportunities opened up by customer data, and how travel brands can tap into customer behaviours to better understand their needs.
Cookies are getting phased out… what’s next?
Many companies are unaware how valuable their first-party information is.
Such data may include not only insights such as names and email addresses, but also a wealth of knowledge such as preferences, budget range, birthdays and anniversaries of the family household.
This allows travel brands to engage customers in new and exciting ways they may not have previously explored, offering them the most personalised experiences possible.
To make the most of this information that customers have willingly shared, brands should collect and verify their data before finding ways to enrich, scale and protect it. To ensure the accuracy and reliability of this data, brands can leverage data cleansing processes offered by external providers, allowing them to conveniently verify and refine their data and enabling them to enhance, expand and safeguard their datasets effectively. This will help them build holistic customer profiles that are meaningful to them as a brand.
Customer data opens up huge possibilities for travel companies
With first-party customer data, brands can create more relevant and personalised marketing campaigns. By analysing customer behaviours, preferences and purchase history, companies can tailor their messaging to individual customers, making their campaigns significantly more effective and impactful.
Companies can also utilise this to open new revenue streams by using their customer data to cross-sell related and relevant products and services.
In addition, first-party data allows businesses to create more relevant loyalty programmes. Whether this is through offering rewards and incentives to customers based on their previous booking history or preferences or encouraging them to book more trips and become repeat customers.
There are other benefits to first-party data which can help brands boost their bottom line, such as driving cost efficiencies. For example, first-party data allows businesses including airlines and tour operators to analyse customer preferences and make data-driven decisions about pricing, inventory management and other operational aspects of the business.
How travel brands can tap into customer behaviours
Travel behaviour has changed significantly since the pandemic, and first-party data gives brands important insights into what guests want now. Using this data, brands can tap into a customer’s behaviour and create typologies to offer more personalised experiences.
Here, a customer’s campaign response, curiosity for product innovations, spontaneity, family orientation, and spending behaviour are all combined into typologies and identified.
This differentiation forms richer profiles than known personas and allows travel brands to provide customers with hyper-personalisation in terms of offers and experiences, suited to what they want now.
By leveraging these customer profiles and first-party data, travel brands can increase engagement, drive conversions, and ultimately grow their business.
Finally, it is important for travel brands to ensure that this first-party data, following the move by Google, is compliant against further browser policy and regulatory amendments. The investment in a first-party data strategy will allow travel brands to futureproof themselves. This is very likely to be a key competitive edge, given the anticipated extensive boom of the travel economy in the years to come.