The better a salesperson knows his customers, the better he will do business with them. That is the case with the local menswear shop salesman, who knows which manager prefers which shade of tie, and also the regional real-estate agent, who knows which people on his books are looking for which type of house. This data is a salesperson's capital and his guarantee of success.
The winner will be the one who knows his customers best
It is no different in today's online world. Everyone who wants to sell something on the internet, whether it is Amazon, a hotel chain, airline or the online chemist, tries to "get to know their customers better". "It will be the next big race," says Michael Strauss, CEO of technology provider Pass Consulting. "The winner will be the one who knows his users the best, because he will be the fastest to lead them to the best individual offer."
The easiest way to see how this works is to take a tour around one of the large IT trade fairs. The theme of personalisation is omnipresent here. Legions of software craftspeople are labouring to identify internet users and allocate attributes to them like age, sex or personal preferences in order be subsequently able to offer them suitable products or services.
The first tentative attempts were taken a few years ago using re targeting advertisements, which for example show a person offers for certain flights for several days in a row, just because the person searched for this once – and has probably already booked long ago. In contrast, the product recommendations from Amazon and Ebay, which were established by then, were a resounding success. By all accounts, Amazon already sells a double-digit percentage of its products not because customers actively look for them, but because the internet retailer nudged them in that direction.
The topic of personalisation is also occupying minds in the travel industry – driven in the first instance from the consumer side. Tour operator TUI, for example, recently personalised its own website. Based on collected data, TUI.com now no longer shows every visitor the same content, but holiday destinations, hotels or departure airports which are likely to be of particular interest to that particular visitor. In the opinion of Dirk Föste, Chief Digital Officer at TUI, this is the way to "understand" his customers "in real time" in the future.
Airlines and hotel chains are also becoming increasingly personal. Lufthansa subsidiary Miles & More has just programmed its app in such a way that frequent flyers receive individual tips on collecting and redeeming their air miles based on their data and in future will also received location-specific offers.
The trend is not even stopping at the product itself any more: Car hire firm Sixt, for example, has developed a vision of a personalised car. In future, cars will already be configured individually as they are being booked online. Then the planned route will be preprogrammed into the satnav, and in the same vein the seat position and the air conditioning too. The customer's favourite stations will be tuned on the radio, or the individual Spotify music list.
Service for the traveller: Yes.
Disturbance in the booking process: No.
Christoph Carnier, Travel Manager at pharmaceutical group Merck, can definitely see the benefits of this type of personalisation – for example more convenience for the traveller, or more efficient processes within the company, because the traveller gets to his destination faster. "I have nothing against service providers offering benefits to our travellers," says the travel manager. "For example, if an airline knows what food a passenger prefers, or which seat, then that is good service and does not affect us at all." However, Carnier voices reservations too. Because if this is "combined with the attempt to draw" the person being courted "into their own booking worlds," as the Merck manager puts it, "then we will have a problem."
Carnier is referring, for example, to targeted special offers which airlines sometimes use to advantage on their own website or app. "Our prescribed booking processes may not be disturbed," the travel manager clarifies. Because if control and access to bookings were to be lost, then the company would no longer be able to fulfil its duty of care. Although Carnier regards the providers' efforts as being "still in their infancy," he nonetheless says that one must "keep an eye on this" as a company.
Henning Schmidt, Director Business Intelligence at HRS, can understand reservations of this nature – "the fear that a third party is getting involved and influencing my travellers." Therefore, the personalisation must occur fully in the interests of the company, he says. HRS itself recently extended its own system of hotel recommendations to include the business travel segment. On request, corporate customers can define their own criteria according to which the hotels in the results list are sorted (see page 12/13). These can be company contracts, particular services, those hotels that were frequently booked in the past, or the favourites of individual departments.
The aim also pursued by HRS with this is: to lead each individual making a booking as fast as possible to the offer that is best for him. Henning Schmidt compares this process to a Google search: "71 percent only look at the first page of results (on Google), and 68 percent of all clicks land on the first five entries." Consequently, even among the 2,500 hotels in Shanghai, for example, the really relevant ones would have to be right at the top, "otherwise the search becomes tiresome."
Recommendation is only the beginning
The plan appears to be working: Before the introduction of what is known as recommendation management, users looked at 6.1 hotels on average before they booked, Schmidt reports, today, it is only 1.4 hotels, he says. "Thus travellers are achieving their goal faster despite a very extensive range of offers and companies are saving costs because of more efficient booking processes," Schmidt summarises the results. One thing is clear to Schmidt, a business mathematician: "If you conjugate the topic of recommendation down the whole way, then at the bottom you have to get a completely personalised recommendation for each individual user."
The approach of taking the traveller and his wishes into account to a greater extent has been increasingly gaining ground in the business travel market in recent years. According to a study carried out by ACTE and American Express GBT, almost 80 percent of travel managers see improved service for the traveller as a way to achieve savings.
Developments of this type frequently come as an external impetus from other sectors, and the next trend in this area is already on the horizon: Under the heading of "predictive analytics", companies are attempting to predict what will interest customers in the future. Streaming service Netflix does this, for example. On the basis of the films watched up to now, it determines the probability with which a particular user will watch a certain film next. Or Amazon again. "Anticipatory shipping" is the concept for which the online heavyweight has already registered a patent. The idea: Even before a customer has ordered a product, delivery is already set in motion, because he will almost certainly purchase it shortly.
Transposed onto travel management, in the future we could see booking systems that not only make suitable individual suggestions for flights, hotels or rental cars when a traveller actively searches for them, but initiate searches themselves. For example, because they foresee that a traveller has to go to a regular meeting in London again next week too. Then a cheap flight and a hotel to go with it could be blocked at an early stage by the system and presented to the traveller as a booking suggestion. After checking the offer, single click suffices – maximum efficiency.
Avail of trends, retain control
But that is all still a long way off. Currently, travel manager and business travel providers are sufficiently occupied with integrating the existing options into their own worlds without losing control over their travel management. Like Jessica Köhling, Travel Manager at Hamburg-based personnel services provider Time Partner: "As a company, we have to control our travel programme," says Köhling, "but at the same time we want to give employees as many options as possible so that they can book the trip that is best for them individually."
Providing his travellers with the best tools is also what Christoph Carnier wants. "Ideally, employees find everything they need in our systems," says the Merck travel manager, and summarises the opportunity and challenge for travel management: "If our applications cover all requirements, then no one will have to look elsewhere any more."