Is the travel industry facing digital saturation? It almost seems like there are more booking services than there are listings. The same hotel room for a given night can be researched and booked through multiple avenues, such as the hotel’s website, any one of the online travel agencies (OTAs), or one of the numerous hotel review sites. That overlap is a by-product of the fact that annual revenue from the travel industry is huge—over $100 billion, which attracts a lot of players each wanting a piece of the action. More recent examples include Google aiding its flight-specific line of business Google Flight.
The good news for consumers is that this creates lots of digital options and pathways. The bad news for the travel industry is that this creates a morass of behaviors and paths taken by the consumer. That makes measuring marketing effectiveness extremely difficult. The fact that online choices are changing all the time (such as sites being redone, new digital partnerships formed, all-new entities arriving, etc.) exacerbates the challenge. Lastly, the overall speed of the internet means that, if consumers so choose, they can complete the research and booking immediately or drag it out for months—so even understanding the search and booking window presents obstacles.
Millward Brown Digital has competed path-to-purchase studies for some of the largest players in the travel industry. These companies know that simple referrals are far too narrow a lens on which to mare accurate strategic and tactical decisions, and that avoiding lost bookings and earning new customers requires a full-spectrum assessment of risks and opportunities.
Also fascinating is how our clients have asked us to tackle the issue: some come with pre-defined hypothesis they want to validate, others are simply looking for some insight.
- A hotel might assume consumers that book often are their best prospects and use us to find people that book many hotels in a given period across all brands and sites.
- An airline may feel it knows all about its own customers but needs to know about the size of the pool of consumers not shopping them—and more importantly how and where to influence them.
- An OTA may want to best drive its business by understanding the number of bookings it loses to rivals and suppliers and where they ultimately book.
- A car rental company may just “let the data speak” and have us create behavioral segments of car rental books starting with the end-state (booking a vehicle), working upstream from there, and then coalescing the collections of behaviors into groups.
- A cruise line may just want to know where and how consumers research and book non-cruise travel to help them truly understand how to leverage the digital research environment
The findings have been rich and informative. We’ve found valuable difference in behaviors based on length of research window, deal-propensity vs. brand-propensity, trigger events (where completion of one event – like booking a flight – triggers another—like hotel research), and conversion benchmarks and milestones. Sharing all of those findings would be impossible in this space, but we can share excerpts from some of the more recent research. The graphic shows travel sites visited by hotel bookers and time in the 30 days prior to booking. The preponderance of OTAs means a mixture of risks and opportunities for suppliers. The presence of airline sites sets the stage for incremental revenue through offering consumer packages with partnerships. Of course bookers also visit thousands of non-travel sites as well. Each visit is a potential inflection point—including though tools on a given site (such research tool) and on-site advertising.
To learn more about how consumers shop for travel and how marketers can reach these travelers, you can download the full report here.
Lincoln Merrihew is the Senior Vice President of Transportation at Millward Brown Digital. At Millward Brown Digital, Lincoln is responsible for steering the Transportation Team, which encompasses the automotive and travel practices. Before Lincoln joined the Millward Brown Digital team, he worked at TNS Custom leading the Automotive team, and then continued on there to lead business development for 10 different industry verticals. Lincoln's career aspiration is to create game-changing solutions and insights. Connect with Lincoln on LinkedIn.