.
Win in the Era of ‘Big Data’
Travel companies have access to mind-boggling customer data: everything from
basic personal information to preferred airline seats, in-flight-entertainment preferences,
meals at hotels, and credit card usage. They have the means to paint detailed pictures to
drive marketing initiatives that more deeply engage customers, yet few—if any—of them
truly maximize the potential of the data at their disposal. There’s no doubt that the synthesis
of sales, pricing and revenue management, loyalty, and IT required to deliver on data’s
promises is daunting. But there’s equally no doubt that companies from outside the travel
sector specifically tooled to make the most of data are going to figure things out,
enter the
market, and try to steal customers.
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Meanwhile, suppliers are moving slowly. British Airways recently announced that it
would equip flight attendants with iPods rather than paper manifests. This provides a way
to capture and use unprecedented levels of customer data, but this capability is only a small
step forward—in many ways, incumbents remain squarely on the back foot in the emerging
era of big data. It’s not too late: suppliers have a wealth of information and resources they
could use to test new ideas. But they need to ask themselves which data they could be
collecting, which existing data are not being mobilized, and which capabilities they should
be building (or partnering to acquire) to compete on the big data battlefront.2
3. Unlock the Power of Partnerships
Imagine if you could type (or speak) the following instruction into your smart phone:
“Book my usual flights from Dallas to New York, out Monday and back Wednesday, usual
hotel, rental car
”—and quickly receive an itinerary compliant with your corporate travel
policies. What would it take to achieve that? We see far too many travel companies seeking
to undertake local, discrete tasks well and not simultaneously thinking broadly about the
kinds of solutions that really engage and stimulate customers. Considering a customer’s
mind-set and thinking more creatively about products and services should be a priority, and
that may require working with, as well as against, competitors. One good example of this
approach is the recently launched hotel search and booking site, RoomKey.com, founded
by Marriott International, Hilton Worldwide, Hyatt Corporation, Inter Continental Hotels
Group, Choice Hotels International, and Wyndham Hotel Group.
In the world of consumer packaged goods, we’ve seen such partnerships take off:
retailers and manufacturers now share unprecedented levels of information across their
supply chains, enabling far more effective merchandising decisions and physical-distribution
and logistics outcomes. Yet the most public dispute in travel—among AA, Expedia, and
Orbitz—is the equivalent of a consumer-packaged-goods company pulling its products
from a retailer’s shelves: it benefits no one.
Our point here is twofold. First, creating new technologies is not necessarily the
answer to all the challenges in travel today; indeed, the technical capacity to deliver what
consumers need arguably exists already, dispersed in pockets across a dysfunctional
ecosystem. Second, the potential of partnerships—lateral (supplier–supplier), vertical
(supplier–aggregator–provider), or with companies beyond the travel sector—remains
to be unlocked. Succeeding here may be more about identifying companies with similar
interests and synergistic capabilities than about throwing new money and new technology
after problems rooted in structural issues of coordination.
