Intelligent data: it’s time to think big

In an ideal world, the travel industry would like to compete on value and innovation, not on price. Will Big Data help them reach this goal?
Triometric marketing manager Alejandra Delgado Sanchez reports back from a PhoCusWright webinar.

Big Data is often accused of being widely overrated, but in fact this phenomenon has re-defined the winners and losers of many other industries. Thanks to Big Data and the ability to accommodate individuals’ preferences and buying patterns, Target in the US and Tesco in the UK, for example, can now treat thousands of customers like a local shop owner would, with individual knowledge, tailored products and targeted advertising.

In this month’s PhoCusWright webinar ‘Business Intelligence and Big Data in Travel Distribution’ an interesting question was asked during the Q&A session: Will it be possible for travel companies to create continuously increasing demand rather than constantly fighting for existing market share through pricing? I believe the answer for many industries is definitely yes, with players like Apple leading the way.

For the travel industry however, it’s early days. A survey conducted during the registration for this PhoCusWright webinar revealed that nearly half of 500 participants in the travel industry were unable to use price and availability search data to make business decisions.

So why is this?

Bob Offutt, senior technology analyst and innovation editor at PhoCusWright and ex senior VP of Sabre Holdings believes it’s going to take time to modernise the messaging feeds, to put them at a point where they can be analysed. He thinks that for this to happen the current mind-set has to change from capturing transactional data to also capturing shopping intelligence and conversion insight and then, the technology to collect that data will be absolutely critical. Kuoni has done it with XML, he says, which will play a big role in this evolution. Bob also hinted that NDC, IATA’s new XML-based standard for distribution in the airline industry, will push adoption across all the travel industry.

Offutt also stated: "Big Data allows precise segmentation of customers- well beyond loyalty programs which vary substantially in the understanding of customers. The travel industry has been focusing on the trip itself rather than specific characteristics around the travellers and their friends – implementing segmentation models will require substantial re-engineering of systems."

Some travel companies, like Kuoni, are ahead of the game. Chris Anders, VP of Global IT Operations at Kuoni Group, said GTA’s ‘Big Data’ evolution began in 1995 when they started collecting lots of data without really knowing what they wanted to get out of it. Now they use this intelligence far beyond the operations department; it’s used for marketing, channel management, inventory management and soon it will also be used for revenue management.

"Per day, I don’t know how we would run the IT Operations piece without the intelligence that we have, it’s just invaluable. The more business intelligence you have, the more you realise the value of it and the more you want," he said.

So what about ROI? Offutt mentioned that Thomas Cook Netherlands identified €3 million in lost revenue in three months and Triometric was quoted in other articles as having identified a lost opportunity of over $10 million by a hotel wholesaler due to having "no availability" in popular hotel properties.

The culmination of PhoCusWright’s research was Bob’s vision of what the future holds for Business Intelligence and Big Data for travel. Besides better forecasts, cause and effect understanding, pattern identification and simulation, Bob highlighted how improved dashboards, self-service analytics being widely available outside of IT departments and real-time processing would allow companies to react rapidly to demand and supply.

This message was affirmed by Chris Anders who echoed: "Our current dashboards are already there, they are dynamic, ever changing, drillable and in real-time, we can see bookings per minute, per hour, do trend analysis…"

Questions from the audience sparked around whether it was better to start big or small in regards to their Big Data strategy to which Jonathan Boffey, business development director at Triometric answered: "The trick with managing Big Data isn’t to become a squirrel that captures everything but really to decide what you need, when you need it and focus on getting that information so you can start taking action."

To learn more about the strategies proposed to turn data into intelligence and the words of caution when implementing a Big Data strategy for travel click here.