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One & Done vs. Many Happy Returns: An Important Choice for Travel Marketers

US Consumers spent more than a trillion dollars annually on travel last year (USTA, 2018). However, when it comes to growing their business, many travel marketers continue to ignore or under-utilize the most important weapon in their arsenal: their existing customer data (CRM).

For many travel marketers, customers come in two flavors: “One and done” and “Many Happy Returns.” One and done-consumers dive into a new hotel, airline, car rental, cruise ship, destination or experience and then check that box, never to be heard from again. On the other end of the spectrum, Many happy returns-consumers find a travel provider or destination they love and want to revisit and experience it over and over. While returning customers may try other experiences and destinations throughout their lives, they can be valuable loyalists — the 20% high-value customer that drives 80% of the business that every marketer covets and seeks.

The Quest for Return Customers

Obviously, the discerning travel marketer would prefer to pull in as many repeat customers as possible with acquisition efforts. But how do you locate and target this “holy grail” of travelers? Many will explore the key reasons for travel and attempt to position themselves well, relative to those value propositions. Others will explore behavioral segmentation, identifying and targeting consumers based on activities that indicate a likelihood for travel booking. Incredibly, some marketers will revert to one of the oldest and most rudimentary tools — simple demographic segmentation focusing on the sex, age, income or home ownership status of target prospects.

What if there was an approach available to travel marketers that could leverage a company’s existing return customers to effectively define, locate, and acquire more of them on a regular basis? That approach not only exists, but has been fully-developed, tested, and optimized for over 20 years and refined into a successful and powerful secret weapon known as people-based marketing.

The End of One-time customers

The dream of marketing in the 1:1 future raised by Don Peppers and Martha Rogers back in 1993, has turned it into reality. We have a viable, predictable marketing system based on reliable analytic principles in which we can market to real people vs relying on demographics, segments, pixels, and proxies.

The people-based marketing approach begins with the source: your customer data.  After locating and extracting those coveted repeat customer records from a company’s CRM system, a propensity model is created using sound analytic methodology to clarify and quantify the factors that make these customers unique. Once that model is developed and tested, it can then be applied to a high-quality, national database to locate and score prospective return customers all over the country. Instead of relying on simple demographics, speculative segmentation or hunches, marketers using this approach suddenly find themselves in possession of a transformative secret weapon — a list of individuals who possess the unique set of attributes known to exist in their best customers. Once this new modeled prospect universe is in place, you can target these prospects and activate them via addressable channels. The strongest programs will not stop there but will continue on an advanced analytic journey with new response models for every activation channel, thus continuing to optimize and improve the engagement with prospects over time.

People-based marketing

A Solution with Real Results

The people-based marketing approach allows marketers to identify those high value customers, understanding what motivates them and makes them tick —and use that knowledge and data to find other customers who are like them. Since it’s based on sound analytics and marketing to real people, it eliminates much of the guesswork still being used by many travel marketers in their current programs. While the “One and done” consumer will always exist, people-based marketing provides a way to bring “Many happy returns” into a leading CRM position.

Merkle has dedicated travel, hospitality, and entertainment experts. We’ll be at the PhocusWright travel conference in November 2019. Get a free business consult at [email protected]

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