Henry Ford – the pioneer of mass production - made motor vehicles affordable for the man on the street. But affordability came at the cost of choice.
NB: This is a viewpoint from Boyan Manev, vice president of business development and product marketing at Vayant Technologies.
As Ford said of his Model T:
"Any customer can have a car painted any colour that he wants so long as it is black."
Consumers accepted restricted choice as a fact of life in the industrial age. But in the digital age, customers won’t wear one-size-fits-all. They expect a much more personalized approach – whether they’re buying a new car or booking their holiday.
The travel industry moved swiftly to accommodate the customer’s growing appetite for made-to-measure personal propositions.
By exploiting the real time connectivity of the internet, travel sellers – whether travel agents, tour operators, aggregators or airlines – introduced dynamic packaging and made it fast and simple for people to custom-build their very own holiday.
But travel sellers can go further with personalization.
Where it (perhaps) begins
Dynamic packaging is just the start – and personalization can allow them to deliver better and better end-to-end customer experiences, with the kind of quality that keeps them a step ahead of the today’s demanding customers.
Thanks to today’s Big Data boom, it is increasingly cost-effective to organise and analyse huge volumes of data. Somewhere in the vast vault of personal data – locked away among the numbers - lies the secret for how a travel seller can delight and even inspire their customers.
Big data analytics helps smart travel sellers unlock this possibility.
So how travel sellers get their hands on information about their customers’ preferences? People today are very ready to share personal information via social media like Facebook and their blogs.
But using this information without someone’s permission is likely to be counterproductive. Instead of being seen as a company that takes the trouble to learn about someone’s preferences, travel sellers that are careless about how they deploy personal customer data could seem intrusive and downright creepy.
Much better is to encourage people to voluntarily share their information with you. One mechanism is the loyalty programme.
Travel providers – and above all the airlines – have long understood the value of loyalty programmes in creating customer ‘stickiness’. Passengers value the rewards that loyalty brings – whether that’s lounge access, free hold baggage or the occasional upgrade – and they are willing to trade their data in return.
Supermarkets lead the way
It is perhaps the supermarket retailers that give the most impressive demonstration of what personalization makes possible.
Companies in this sector were the first to get serious about harvesting personal data and then using it to redesign customer experience and core business processes. One of the most successful in exploiting the power of personalization was UK-based supermarket retailer Tesco.
In 1994, Tesco introduced its Clubcard loyalty programmme. This incentivized customers to share their data, allowing Tesco to build up an incredibly accurate and intimate picture of how its shoppers spent their weekly grocery budget in the store.
The company could then adjust its offering accordingly, re-shaping its promotions, product range and even store design around what they had learned.
Personalization didn’t take long to deliver. As Tesco’s then marketing director (later CEO) Terry Leahy recalls, just one week after implementation Clubcard had generated a massive 10% uplift in sales.
Testifying to the scheme’s long-term success almost two decades later, 16 million people in the UK hold a Clubcard – and a further 27 million worldwide.
The advantages of this more personalized approach are compelling – and travel sellers should get in on the game.
Air industry has to follow that lead
Flight search is a clear candidate for change: here, travel sellers could offer their customers the ability to precisely customize their search with preferred optional services and preferred destinations for preferred seasons.
As well as offering a better online shopping experience, introducing personalization at the search stage will generate data that travel sellers – and their partners – can use to re-shape their business processes.
At one in the same time, they can become more customer-centric and more efficient.
To get the ball rolling, travel sellers should create opportunities for customers to share their personal preferences.
We’ve looked at loyalty programmes: granted, these may be too ambitious for many smaller travel sellers.
But they could still find ways to get customers to submit information, for instance via promotions targeted at registered users (who have created on-site profiles) or encouraging customers to connect to the online travel shop via Facebook.
For travel sellers that have taken the leap and created a loyalty scheme, don’t be shy about it. Make it prominent on your site, actively promote it – and make it as easy as possible for people to sign up.
On one view, the rise of today’s ever more demanding customer can seem daunting: they want good value and they expect something unique and "just for them".
But as we’ve seen, this drive for a more personalized level of service creates more ways for retailers to learn from customers and optimize their model accordingly.
This creates a powerful opportunity: for customers and for travel sellers. So expect personalization to more and more define the future of our industry.
NB: This is a viewpoint from Boyan Manev, vice president of business development and product marketing at Vayant Technologies.
NB2:Global hands image via Shutterstock.