Page 153 - Building Big Data Applications

Chapter 8 Travel and tourism industry applications and usage 151

Hospitality industry and big data

The term “big data” means many different things to different people. Generally speaking,
it describes the collection of information from both offline and online sources to support
the ongoing development and operations of a company or organization. This segment of
discussion is around the hospitality industry which is related to hotels, resorts, and
vacation properties.
Data can originate from almost anywhere, including everything from historical
records, point-of-sale devices and current consumer habits to customer feedback,
referrals, and online reviews. With so much information coming from all directions, it is
tough to rein it all in and apply it a useful way, but that is where the discipline of big data
analytics comes into play.
It is crucial to define big data when trying to understand its role in hotel and
hospitality. With so many companies embracing big data and applying it to improve
their operations, it might be the key to maintaining competitiveness in the future. Big
data has relevant applications in nearly every industry imaginable. To use this
information to its fullest extent, it is important to know where it has the greatest impact.
Customer categorization is a critical success factor for maximizing profits regard-
less of industry. This algorithm is used in the categorization and identification of
incoming customers. To properly categorize a customer according to their poten-
tial for profitability, companies must track customer spending habits over time,
track their channels of prospecting, their influencers, and understand their social
makeup and behavior. These pieces when aligned together in a model will help
develop analytics and provide the appropriate bucket to segment the customers for
campaigns. A leading financial services institution was using incorrect segmenta-
tion models leading to 2% return on campaigns, when this was noticed and cor-
rected with all associated inputs, the same campaign execution resulted in 34%
return and an additional 21% cross-selling opportunities. Hotels can leverage
similar approaches to customer segmentation and award them buckets of points
and levels of segmentation, which will promote their loyalty and keep them as
happy customers. A happy customer is the best referral that can be available for
more growth and visibility.
Personalized service is an opportunity to hotels to provide customers with benefits
that make them feel rewarded. For example if you travel 14 h by flight and then
spend 2 h at customs before you arrive at a hotel, then best personalized services
to offer you would be easy check-in, a good breakfast, a massage service for 1 day,
and offer to assist you in any travel or other services. This type of a service exists
in hotels, but not for all customers and this can be easily modified to accommo-
date all types of customers, except that some customers might have to pay for
certain services, which can be compensated in charges. Today hotels are offering