Booking travel, accommodations and destination excursions online or via mobile apps is now the norm, and that means travel companies have a wealth of customer data to analyze and apply. Theoretically, that can be a great thing, both for marketers trying to reach customers and for customers who are looking for travel bargains. But it all depends on using data wisely — and understanding boundaries.

Artificial intelligence (AI)-powered recommendations, location-based marketing and hyper-personal targeting are generating significant returns for travel and hospitality brands that use advanced data analytics. By tracking conversion funnels, detailed demographic behavior, page conversion performance, bounce rates and other metrics, data-driven marketers are besting competitors.

Mobile application-based services that provide hotel suggestions, GPS tracking, real-time travel plan recommendations, on-the-go price comparisons, AI-based ticket booking, etc., are increasingly popular and can provide real benefits to both travelers and brands. But whether data is generated via mobile or online activities, it’s important for brands to use it strategically to derive and deliver value.

Managing Disruptions and Doing Right by Customers with Dynamic Pricing

Hospitality brands harness analytics to offer value to customers and generate business by helping people manage disrupted travel plans. If weather causes flight cancellations, stranding travelers, brands can come to the rescue with airport concession deals or local hotel offers. This type of assistance is generally appreciated by travelers and can increase loyalty.

But sometimes brands reward customer loyalty by withholding their best offers. Some hotel brands, for example, use data to identify their most loyal customers and then exclude them from discount offers when conducting dynamic pricing outreach. It may work in the short term to generate more revenue, but it carries the risk that the customer will discover the discrepancy, damaging the relationship.

Targeting the Right Customers

With the volume of data available today, hospitality brands should be able to micro-target consumers precisely for discounts and special offers. There’s no excuse today for sending irrelevant offers, which not only won’t achieve conversion targets but may also put customer-brand relationships at risk.

If a traveler’s past activities indicate that she’s a snowboarder who enjoys visiting microbreweries, an offer to visit sites in a destination city should reflect those interests. Offers that focus on totally unrelated interests like gardening or antiquing might even inspire the customer to unsubscribe from a service because the customer will conclude that the brand doesn’t know her.

Looking Forward, Not Backward — And Toeing the Line

Offers that are a little too on the nose may cross the fine line between being proactive with customer data and making customers feel uncomfortable. Customers can find it unnerving when they’re contemplating a trip and a brand serves up an offer before they’ve even visited the company’s site. On the other hand, if the offer is on-target and relevant, most customers will accept it.

But one irritant brands should avoid is delivering offers for a fare or accommodation the customer has already booked. Seeing a lower fare or hotel rate later will just make them sorry they accepted the earlier offer. Instead, hospitality companies should consider using data to create deals on excursions at the destination city or another discount that is relevant and timely. Look forward, not backward.

Treading Lightly while Deriving and Delivering Benefits

Like any other marketing initiative, analytics-based, data-driven campaigns should benefit the travel and hospitality brand and the customer, and marketing should measure satisfaction to make sure it does. Many companies rely on customer ratings to gauge success. A simple customer service rating (one through five stars, for example) is easy to do, but it doesn’t provide much information.

A more open-ended “what if” survey might provide more actionable data, benefiting both parties. It can start with an internal discussion, e.g., would integrating a hotel’s booking app data with loyalty account information be feasible, and if so, what benefits would the brand and customer expect from the integration? Then the brand can explore the question with customers.

When considering ways to deliver offers, it’s also important to keep customer demographics in mind. Tech-savvy users might not mind aggressive use of their browsing and location data, whereas other customers might be put off by it. There’s a fine line between establishing a symbiotic relationship with customers and coming across as stalker-like, and brands should tread lightly.