The best part of 2020 is that it is coming to an end, some would say.
We can only agree with this thought and turn our gaze towards a more radiant 2021, where vaccination makes us hope that we will return to normal and we will quickly forget the so inflated “new normal” we have been talking about throughout 2020.
But will it really be so? Will this limbo in which we find ourselves disappear completely to be replaced by our comfortable “same old, same old”?
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It is difficult to say and making predictions is just pure guessing right now.
Our 2020 learning in 10 points:
This is an abstract from a Whitepaper written by Silvia Cantarella of Revenue Acrobats and Alessandro Crotti of Direct Your Bookings. You can download the Whitepaper by clicking here.
1) Real time data matters
The pandemic has given a blow to the historical data, made the past irrelevant and transformed the “here and now” into our new reference.
What we learned
Data is always relevant (no matter how bad the times can be) but the data reference can change.
The historical data becomes meaningless when volatility, uncertainty, complexity and ambiguity reign; our history is wiped off and we start zero-based: it feels like opening a brand new hotel.
Also, we’ve learned that the important metrics and KPIs change over time and we should be smart and flexible enough to adapt and comprehend a new way of doing things.
In Revenue, for example, RevPAR has been THE metric par excellence for many years, now being replaced by TRevPAR, RevPAG, ProfitPAR.
In Marketing, take the example of all the recent news with Google Analytics 4: Bounce Rate has been a top KPI for decades, now totally being deprecated by Google itself.
What we abandoned:
The focus on internal data is not sufficient anymore: when the reservations and pick-up are stuck, we just cannot run reports!
We need to look outside to get information and data insights: big data, airlines, travel researches, analytics, industry publications, expert studies, global trends.
What we will keep:
The need to combine internal and external data in a way closer than ever before.
Every key player in the hotel industry: from the RMSs to the Digital partners, from the Rate shopping tools to the Channel managers just to name a few, are leveraging data from different sources acknowledging one simple fact – to cope with uncertainty you need to cope with big(ger) data.
2) Segmentation vs Targeting
The segment mix as we knew it is no longer existing, it is changing, adapting, and ever-evolving. Revenue segments are limited, and the segment analysis requires a more granular approach and move towards targeting.
What we learned:
Consumers’ preferences change, we must not be comfortable with the idea of knowing who our customers are.
The change in segments behavior has caught many by surprise (let’s think about booking windows shrinking, los changing, geo sources changes and the last minute unexpected demand for proximity travel) but only through constant questioning of the segments and their profiles we can be able to understand what their needs are and target them at best.
Furthermore, we’ve learned that Marketing and Revenue should work on bringing Targeting and Segmenting together.
The “Individual Leisure” segment all Revenue Managers are familiar with, is totally useless for Marketers. And on the other way around, a target audience including “women, aged 25-44, interested in Shopping” remains totally unknown to RMs.
What we abandoned:
The way we used to work with our segment strategy.
By understanding the evolving changes in customers’ preferences and the fact that we could rely only on 1 or 2 segments traveling, our focus is switching from the segments (revenue) to the targets (marketing).
The traditional revenue segmentation is dead, the traditional marketing targeting is dead too. Long live the combined segment/target approach to customer profiling!
What we will keep:
A more granular and complex segmentation now including segments and targets in our strategy. A new way of analyzing our demand, a diversified strategy taking into consideration plan A, plan B, Plan C.
Things might change unexpectedly and we must be ready to be proactive rather than reactive, adjusting our execution.
Quietly sitting in only the things that we know is a risky game to play.
This is an abstract from a Whitepaper written by Silvia Cantarella of Revenue Acrobats and Alessandro Crotti of Direct Your Bookings. You can download the Whitepaper by clicking here.
