Location is the New Frontier in Marketing Cloud for Travel and Hospitality
How top marketers are winning against digital-only disruptors by bringing location to the cloud.
Written by HYP3R CEO, Carlos Garcia. Shared on Medium April 23, 2019
There’s a battle in the clouds over who owns the customer in the travel and hospitality industry. Industry-leading CEOs are not mincing words. Marriott’s Arne Sorenson recently said “we are in an absolute war for who owns the customer” referring to the dramatic increase in Online Travel Agencies (OTAs) who now drive tens of billions of dollars in bookings and leave companies in hospitality with limited access to customer data to personalize marketing.
While the battle in the clouds intensifies, down on the ground, there are real people enjoying travel and sharing their experiences. Finally, those experiences are making their way to places like Salesforce, property management systems, and marketing automation platforms in what we call the third generation of location marketing.
Bringing location to the cloud has never been more critical. Traveler expectations continue to rise. Today’s travelers are willing to pay up to 14 percent more for great service at a hotel. Millennials and Gen-Z travelers in particular drove a recent 26 percent jump in spending on activities while traveling, including one-of-a-kind experiential elements in areas like food and beverage.
To stand out, marketers are under immense pressure to unlock new patterns of customer behavior and rapidly act on them. This next-generation customer service and relevancy is exactly what the third generation of location marketing enables.
The Third Generation of Location Marketing
To understand the transformative value of Location Marketing Cloud, we must look back at the evolution of “location marketing”. The first generation of location marketing was all about a businesses’ physical location. Your hotel or restaurant had to be on a prominent corner of Main Street for people to find it. Then we all got smartphones and companies like Foursquare connected the dots to deliver ads to people passing by a specific location. This second generation was still somewhat primitive and often simply enabled interruptive advertising. If someone walking by a Chipotle on the way to a Michelin starred restaurant received a burrito coupon, was that really delightful? But in the third generation of location marketing, the cloud, we are able to understand the larger story behind that customer, as well as who our highest value customers might be, by using past experiences to anticipate what guests will enjoy in the future.
How Top Companies Use Location Marketing Cloud
Location Marketing Cloud is already being used by some of the largest and most innovative hospitality companies in the world, including Marriott and Caesars Entertainment. Marketers have begun to adopt location insights that they match to enhance customer records on Salesforce. These insights help marketers understand where customers go in the real-world, as well as what types of experiences they enjoy and share. Marketers are able to understand which competitive locations guests most recently visited and their share of wallet.
Salesforce Profile Enriched with Location Insights
Let’s take a few examples. With Location Marketing Cloud, a major cruise line was able to identify guests who cruised with another line and win them with a personalized offer that lowered Customer Acquisition Costs by 40 percent.
Companies like Marriott receive real-time alerts when guests on-property publicly share experiences about key events, such as birthdays or anniversaries, so they can surprise and delight them. Hotel staff are also able to identify highly influential customers when they walk in the door, as well as rapidly respond to support issues, connecting a digital complaint with a face on the ground.
The result is marketing that not only builds strong relationships, but is also delightful for customers.
For Brad Slaney, Food & Beverage Executive at the W Hotel Koh Samui, Thailand, leveraging location insights has been a game changer.
“People share something on the internet about, for example, a great meal they enjoyed with us, and they might think it doesn’t have an impact,” Slaney said. “But then the next day, our chef can come up to their table and say, ‘Oh, I heard you really enjoyed our pad thai. Here are some other things we think you’ll also like.’ It shows our guests we are listening and that we care.”
Personalizing the Customer Journey with Location Insights
Personalizing the customer journey is especially important among Millennials who express a desire to be surprised and delighted 71% more than other generations. Across all generations, travelers are 20% more likely to spread word-of-mouth when they are offered a personalized experience.
Nearly 50 percent of consumers also say that first impressions are the deciding factor on whether they will purchase a product again or return to a service. Having insight into why a guest is traveling also has a 23% impact on guest satisfaction.
Extra attention to detail, therefore, goes a long way, helping hospitality marketers win the second stay and beyond. Location Marketing Cloud can be the catalyst that helps marketers build a long-lasting relationship.