The travel and hospitality industry felt a massive initial impact from the onset of the COVID-19 pandemic in the first quarter of 2020.¹ Things didn’t improve much for the rest of the year, with monthly occupancy for hotels staying below 50% for the remainder of the year.²
Metrics have improved in 2021 as a majority of the country³ has been vaccinated and high-traffic destinations have returned to something approaching normalcy, but the highly contagious Delta variant has prevented the industry from returning to 2019 levels of business.
3 Ways Travel Companies Can Take Advantage of Third-Party Data to Increase High-Value Business
With uncertainty likely to persist, marketing strategies for travel and tourism must take account of smaller budgets.
One way many travel businesses will likely look to gain an advantage is with their existing first-party data. But that won’t do the job on its own due to a lack of bookings, flights, and visits during the pandemic. Enriching first-party data with third-party data can help the industry drive value and win business in an uncertain time.
Travel brands, bureaus, and agencies now struggle to identify and connect with their most valuable prospects. Due to dramatic shifts in travel behavior, the most valuable audience to engage and attract may be the one that's least understood.
Third-party data sources without cookies can offer a solution. Here are three ways that third-party data enrichment can help travel businesses make confident marketing and advertising decisions in a changing ecosystem.
1. Fill in missing consumer data about today’s travelers.
Nearly every business places importance on making data-driven decisions and maintains some kind of customer database to help collect itself. Nevertheless, there’s a limit to the type and amount of information that can be gathered using first-party data.
These limitations leave gaps in your ability to understand important details about customer demographics and behavior. And, considering the pandemic’s impact on travel, any assumptions or predictions based on historical data could now be irrelevant. This creates an even bigger gulf between you and your current best prospects.
- Advanced demographic data to reveal insights on age, gender, affluence, household size, and relationship networks.
- Behavior data which shows countries/cities/states traveled and brand propensity.
- Location data to see where your visitors are coming from and where they visit next.
2. Target lookalike audiences to reach new visitors.
Valuable consumer insights allow marketers to use analytics and modeling to identify high-value prospects and reach them through programmatic ad buying and other types of campaigns.
For instance, many destinations have renewed interest in enticing auto travelers due to uncertainty around air travel. Device location data can effectively identify visitors as auto travelers, locals, or flight passengers. Based on how your highest-value customers come to your destination, a lookalike audience using third-party data can be gleaned from the dynamics of your current or desired visitors.
3. Segment creatively to improve your acquisition strategies.
Companies in the travel space can also build high-quality syndicated and custom audience segments for targeting high-value prospects.
For example, there have been a variety of different travel behaviors among segments of the population over the past year and a half that can be used by travel, tourism, and hospitality companies. Some people have hardly vacationed at all since March 2020, while others took advantage of international travel in open destinations like Mexico as early as the summer of 20204.
After the vaccination drive began en masse in early 2021 and continued into the spring, many vaccinated travelers in their 20s and 30s without kids took the opportunity to go to European Union destinations5, while many in those age groups with families may have opted for more traditional, family-friendly destinations like Disney World. If a segmentation strategy by a travel business only looked at one demographic data point, like age, all of these travelers could get grouped in the same basket.
Depending on the brand, various potential travel segments, grouped by highly specific behaviors and/or demographics, carry wildly divergent values from one another, but segmentation can help a travel business target the right ones with the highest potential revenues.
The predictive modeling used in third-party audience segments also takes account of changing patterns in behavior that are likely to result from future developments in the pandemic.
Marketing strategies for travel and tourism are constantly changing. Be prepared for uncertainty with third-party data.
The forecast for 2022 and 2023 is promising but uncertain, and experts don’t believe the industry will be back to 2019 levels of business until 20246. No strategy can guarantee a profitable next few years for the industry, but understanding customers fully, targeting lookalike audiences, and creative segmentation with third-party data can help travel companies win high-value business in an uncertain era.
2 https://www.costar.com/article/1403573247; https://str.com/press-release/str-us-hotel-performance-december-2020