Industry Update
Opinion Article10 May 2019

The 3 Biggest Guest Data Challenges Facing Hospitality Companies

By Adam Corey, Chief Marketing Officer at Tealium

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From browsing to booking and check-in to check-out, hospitality brands benefit from innumerable touchpoints with their guests — with each touchpoint an opportunity to observe preferences, gather feedback and improve the guest experience. Unlike some other industries, hotel guests are actually eager to share information about their travel likes and dislikes because they know it results in fluffier pillows, tastier breakfasts and a better overall experience.

So, the challenge for today's hospitality marketers lies not in identifying opportunities for feedback, but in gathering and turning this data into useful insights that inform business decisions. Just 8% of organizations say their customer data and analytics programs are connected to every customer touchpoint and interaction. That's a huge wasted opportunity in an industry that hinges on guest satisfaction.

To gain (and maintain) a competitive edge, hospitality brands must unite their entire operations around a common, customer-centric data strategy. This is especially important in the face of Europe's General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), which place strict rules and restrictions around the collection and use of data. Keep an eye on GDPR and CCPA; they are likely to set the tone for other states and countries in the months and years to come.

At the same time, guests expect hospitality companies to use their data; 65% want hotels to invest in new technologies to modernize the user experience. These three challenges should be top-of-mind while developing and executing your company's data approach.

  • Consider all points in a guest's journey

Customers provide personal data to a complex mix of people throughout both the booking and fulfillment journeys, many of whom they never see or even consider. This includes a vast array of digital booking touchpoints like online travel agencies and agents, in-house PBX agents, front-desk personnel and managerial staff. This complexity makes it difficult to identify which areas to prioritize when it comes to data gathering and security.

First, focus on a holistic internal approach to avoid data silos, prioritize privacy and security, and ensure insightful outcomes. Everyone in your organization should know where to find customer data, and how to use and secure it appropriately.

The hospitality groups of the future will rely on customer feedback that goes far beyond face-to-face conversations and online surveys. Among the technologies to expect in the next few years:

  • Voice-activated digital assistants that take room-service orders or control room lighting
  • Artificial intelligence (AI) that provides onsite activities and dining recommendations paired to guests' preferences
  • Biometrics that allow customers to access their rooms via fingerprint or facial recognition

These technologies will not only will allow for an enhanced customer experience, but will also represent another opportunity for hospitality brands to gather and leverage data to improve their businesses.

  • With great customer trust comes great brand responsibility

Your hospitality group has a solid grasp of the guest benefits associated with gathering and applying customer data. But that value proposition is paired with trust that guests' most personal information, including credit card and passport numbers, will be used and protected both safely and appropriately. Considering the stakes, hotels have a much higher bar to clear than many other industries, including retail, when gaining and retaining guests' trust.

Consumers are still struggling to grasp the full ramifications of having their entire lives digitized. Between the increasing number of government regulations and highly publicized data breaches by big-name companies, guests will continue to push for greater transparency into the data companies possess, how it's used and how it benefits them. Hospitality groups must hold detailed conversations around these details to prevent a widespread brand trust issue.

Generally, guests are more forgiving of a privacy incident if they believe a brand operated with good intentions. Hospitality leads the way for other industries; hotels are inviting people into their "homes," fostering relationships to build long-term opportunities for goodwill. It's a truly differentiating value proposition — and one that hospitality brands must leverage responsibly.

  • Plan with an eye on legal compliance — both present and future

Global hospitality brands are already grappling with the effects of GDPR, which in part, regulates digital communications such as marketing emails. And GDPR didn't happen in isolation — it's the new normal. CCPA goes into effect Jan. 1, 2020, and many other countries and U.S. states are considering similar regulations. Going forward, companies will need to decide whether to take a reactionary approach to regulations as they arrive or proactively incorporate trends into their long-term data approach.

Try as they might, hospitality brands can't fully predict the future. Consider the state of the industry 10 years ago, when digital marketers were first introduced to remarketing properties. They created new advertising, and increased conversion rates because guests were able to book rooms closer to their visit. But by and large, hospitality companies didn't ask long-term questions about what data they were collecting and whether individuals really wanted to be tracked. It's a scenario that's playing out in a more sophisticated way today.

Of all the questions hospitality groups must ask themselves in this new era of customer data security, one should rise to the forefront: "How are we doing the right thing on a regular basis to hold up our end of the bargain for guests?" The brands that identify how to hold up their end of the bargain and then act on it, will be the ones that foster truly trusting, data-driven, long-term guest relationships.

Adam Corey

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