Introduction
It’s been five years, but the huge repercussions caused by the COVID-19 pandemic have created several complex challenges in travel industry that led to a massive decline in travel volumes. With time, the industry has slowly started to solve the challenges, but to eliminate them – the industry still has a long way to go.
After the lift of the travel ban, there was an increasing number of travelers who were eager to travel to new destinations. This eagerness has benefitted the travel industry, but it has also created a new set of challenges. Today’s customers’ needs and requirements have evolved—they’ve changed their expectations, behaviors, and loyalty to brands. This shift means that travel brands can no longer rely on outdated methods of segmentation, marketing, and customer retention.
Travel companies must adopt more advanced technologies that allow them to get an in-depth understanding of customer behavior. Integrating your Customer Data Platform (CDP) with cloud platforms will help travel brands analyze customer data without breaking any data governance policies. The detailed analysis of guest data will help you create personalized experiences, improve customer retention, and enhance marketing efficiency.
In this blog, we will explore the major challenges faced by travel industry and how cloud-powered CDPs can help eliminate these barriers, offering a more efficient, personalized, and cost-effective approach to customer experience (CX) and business growth.
Challenges in Travel Industry Creating Uncertainty Among Travelers
Many travel companies are struggling to harness the full potential of customer data. Even after recognizing the value of customer data, many have yet to fully implement systems that can extract actionable insights from this data. This is where CDPs integrated with cloud come into play. These cloud-powered CDPs offers a robust solution to help professionals eliminate the challenges. Here are some of the challenges:
Fragmented Customer Data
Travel brands often have customer data scattered across multiple systems like reservation systems, point-of-sale systems, and mobile apps. This fragmented data creates silos, making it difficult to get a unified view of the customer and offer personalized recommendations. This results in missed opportunities for creating a solid base for customer engagement and conversion.
Evolving Customer Expectations
Almost all avid travelers expect more personalized experiences, such as tailored recommendations for the best places to travel, seamless booking processes, and post-trip engagement. As many travel brands are still using traditional marketing methods, they are unable to access historical data and have an in-depth overview of customer segments. This creates another roadblock for delivering personalized offers.
Cost Inefficiency in Marketing
Travel companies often face high customer acquisition costs due to their inability to target the right audience. With limited marketing budgets, it’s more important than ever for brands to ensure they are engaging with the right customers through the right channels.
Operational Constraints
The COVID-19 pandemic highlighted the importance of operational agility in the travel industry. As travel demand surges, companies must be able to quickly adapt to changing conditions, whether it’s scaling operations, adjusting marketing strategies, or responding to customer needs. Travel brands that can’t move fast enough risk falling behind competitors.
The Role of Cloud-powered CDPs in Addressing These Challenges
A Customer Data Platform (CDP) is a centralized system that collects and unifies data from various sources to create a comprehensive customer profile. These platforms have evolved over time, with CDPs integrated with cloud providing the scalability, agility, and advanced analytics needed to meet the demands of modern travel businesses. Let’s explore how CDPs when integrated with cloud address the key challenges in the travel industry.
Breaking Down Data Silos
Cloud-based CDPs centralize all customer data in a unified platform, allowing travel companies to have a detailed view of the customer profile. For example, a hotel chain can bring together data from its reservations system, property management system, and loyalty program to build a comprehensive customer profile. This unified data enables travel brands to understand customer behavior more accurately, segment audiences effectively, and deliver personalized messaging.
With all data in one place, cloud-based CDPs eliminate the need for manual data collecting and integration, enabling travel companies to provide seamless customer experiences across channels. Whether it’s a flight booking or a hotel check-in, travel brands can use the insights from unified customer data to tailor offers and recommendations that resonate with each individual customer.
Delivering Personalized Customer Experiences
Customers today expect more personalized travel experiences and meeting this demand requires a deep understanding of customer preferences, behavior, and needs. Traditional segmentation methods, which rely on basic demographic data, are no longer sufficient to deliver the kind of personalized experiences today’s travelers expect.
Cloud-based CDPs, powered by machine learning (ML) and artificial intelligence (AI), enable travel brands to analyze large datasets and predict customer preferences. For instance, a cloud-powered CDP can help a travel company identify a customer’s past travel patterns, preferences for adventures and activities they enjoy. With this information, the travel brand can send personalized offers and tailor activities that enhance the customer’s experience. This level of personalization enhances customer satisfaction and drives loyalty.
Optimizing Marketing Budget
Cloud-based CDPs allow travel brands to optimize their marketing efforts by ensuring they target the right customers with the right message, at the right time. By using data-driven insights, brands can refine their marketing strategies and focus on high-value customers, reducing unnecessary expenditure.
For example, using a cloud-integrated CDP, a travel company can analyze customer data to identify the best channels for reaching each individual customer. It can also track the effectiveness of campaigns in real-time, allowing for quick adjustments to marketing strategies. Additionally, AI and ML capabilities can predict customer lifetime value (CLV), allowing brands to allocate resources more effectively, focusing on the most profitable customer segments.
This level of optimization leads to reduced customer acquisition costs, as brands can avoid spending on inefficient marketing campaigns. Instead, they can spend their allocated marketing budget to engage with the right customers through targeted ads and personalized email campaigns, improving ROI.
Enhancing Operational Agility
The travel industry needs to be agile—especially in times of unforeseen natural calamities or when demand for travel services rises unexpectedly. Cloud-based CDPs provide the scalability and flexibility necessary for travel companies to respond quickly to changing conditions. For example, when booking trends shift or a new travel restriction is announced, a cloud- integrated CDP enables travel brands to adjust their marketing strategies in real-time.
Cloud-based CDPs also enable travel brands to make faster and data-driven decision-making. Since all customer data gets unified and can be accessed in near real-time with these cloud-powered CDPs, travel brands can leverage insights instantly to optimize customer experiences, launch promotions, and address gaps while providing service to their customers. This operational agility is crucial for staying competitive and ensuring that customers feel valued at every touchpoint of their journey.
How Snowflake Helps in Solving the Challenges in Travel Industry?
Snowflake- a leading AI Data Cloud platform helps travel brands overcome the challenges seamlessly by allowing them to develop and deploy LLMs and ML models, that streamlines data supply and helps forecast demands. Additionally, travel brands can also integrate Snowflake’s AI data cloud platform with their existing CDPs to gain maximum leverage over their competition.
By integrating their CDPs with Snowflake, travel companies can swiftly share, collaborate and derive value from customer data. Moreover, by building your customer data platform over this AI data cloud platform, you can also choose or build a unique customer ID that will help you track your customers’ journey and monitor your team’s performance. With this Snowflake integration you can be sure that you will never miss out on the opportunity to create value with your customers.
Kasmo, a proud partner of Snowflake has been helping clients globally to optimize their customer engagement and enhance revenue by leveraging Snowflake. With our unique accelerators, you can now tailor recommendations and personalize your travel strategies easily.
Conclusion
As the challenges in travel industry continues to grow, the need for adopting cloud-based CDPs has increased now more than ever. Travel brands looking to stay competitive and deliver exceptional customer experiences, need to start upgrading their CDPs with Snowflake.
This unified platform compiles fragmented customer data and provides deeper insights into customer behavior, optimizing marketing spend, and enabling operational agility. CDPs integrated with Snowflake empower travel companies to break through the barriers that have traditionally hindered growth.
As more travel brands embrace cloud-based CDPs, the industry will undoubtedly see a shift toward more personalized, data-driven marketing, helping brands to meet and exceed the ever-evolving expectations of modern travelers.
