Privacy is the issue on most people’s minds these days when it comes to technology, and companies are responding by giving users more control over their data.
NB: This is an article from Cendyn, one of our Expert Partners
While consumers see these recent changes as beneficial, marketers are more than a little concerned. That is because these changes are on course to alter the foundation upon which virtually all digital marketing is based. While there is a future for email marketing, hoteliers need to be aware of what is happening so that they can adjust their strategies accordingly. In fact, hotels that prepare properly can get ahead of the competition and use this as a way to get back to the core of hospitality — creating meaningful relationships with their guests.
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What’s happening
Apple is leading the charge on giving users more control over how their data is shared. The company’s upcoming iOS 15, iPadOS 15, and macOS Monterey updates include a Mail Privacy Protection feature, which will mask the user’s IP address and prevent marketers from knowing if and when their emails were opened. Apple is also planning to introduce a Hide My Email feature, which enables users to create proxy email addresses instead of sharing their primary address. These proxy addresses forward messages to the main inbox and can be fully controlled by the user. The effect is similar to Gmail’s Promotions tab, which collects emails that are identified as marketing messages by the algorithm.
These changes are reflective of the stance being taken by all the tech giants, including Facebook, Google, and Microsoft, to protect the privacy of their users. Apple recently gave users the choice to block its Identifier for Advertisers (IDFA), which allows advertisers to target and track users across iOS devices. Safari and Firefox, two of the world’s most popular web browsers, already block third-party cookies, and Google has plans to do the same.
Why it’s important
These updates are so significant because digital marketing is largely based on user behavior. Until now, email marketing made use of invisible pixels and other discreet methods to gather information from recipients, allowing marketers to personalize their messaging and monitor precisely how users interacted with their emails. Not only will companies have less information about their potential customers — such as device, location, and demographic — but they also won’t see if and when their emails are opened.
These changes will drastically change how marketers track and measure their success. Instead of focusing on how many emails were opened, marketers will now need to prioritize click-through rate — the percentage of users who click the link(s) within the email. In order to do this, they’ll need to move away from a “batch and blast” strategy, and instead make sure that the content of each email is effective enough to earn a click.
What’s next
While consumers demand more control over their data, they have also become more accustomed to personalized experiences online, creating a challenge for digital marketers. Marketers must now find new ways to learn about their potential customers and provide them with engaging, custom content. Instead of doing this behind the scenes, companies will need to rely on information they receive directly (and willingly) from users — in other words, first-party data.
First-party data is information given knowingly by users. Polls, sweepstakes, newsletter sign-ups, and interactive social posts are all examples of how hoteliers can gather incredibly useful data directly from users. With third-party data and many traditional email metrics gone for good, this first-party data is going to be vital to the success of marketing efforts.
In order to maximize the amount of data they collect, hoteliers need to focus on two key factors: trust and value. Users are more likely share their information with brands if they trust that the data will not be shared with other companies. They also will only share their information if they stand to gain something in return. In addition to using this data to provide guests with relevant content, hotels can offer value adds such as coupons, vouchers, and discounts to incentivize users to interact online.
In addition to collecting data, hoteliers need to step up their reporting. They will need to look more broadly at their marketing metrics and not just rely on email data (specifically open rate). There’s a lot more to engagement than email opens, and if hoteliers can get more granular with reporting on clicks, UTM parameters, and other channels of engagement, they’ll ultimately get a bigger picture on how guests are engaging with their brand.
Tools for hoteliers
Hotels will now be completely reliant on the data that they can gather themselves, meaning the technology they use to manage and make sense of this data will be paramount. How well a hotel can manage its data will determine how successful its marketing — and ultimately the hotel itself — will be.
Managing data begins with a good CDP (Customer Data Platform), such as Cendyn’s Starling solution. As data streams into a hotelier’s website — through the booking engine, newsletter sign-up, online surveys, etc. — Starling consolidates, cleanses, and enriches the data, providing a central source of truth. Not only can the hotel use that high-quality data to fuel guest communications, services, and personalized marketing, but they’ll have a detailed account of where that data came from, ensuring the ability to meet global privacy regulations.
Once a hotel has high-quality data, it still needs to put it to good use. That’s where a CRM (Customer Relationship Management) platform comes in, like Cendyn’s eInsight™ CRM. The platform takes all of the data gathered by the hotel and uses it to create 360-degree profiles of past, present, and future guests. This allows hotels to evaluate guests’ RFM value (Recency, Frequency, Monetary), segment audiences for marketing campaigns, and target guests with personalized messaging.
Conclusion
Email marketing will continue to be an incredibly effective way for hotels to generate business, but the learning curve will be steep. As privacy and control over data become the norm, first-party data is moving to the forefront. Hoteliers that can properly adapt their systems and strategies will be successful, while those that don’t will see a sharp decline in the effectiveness of their marketing efforts. By maximizing the amount of first-party data collected, and managing it properly, hotels can guarantee their success. If anything, this shift just makes hoteliers focus on the same principle that has always been at the core of hospitality — building trust and quality relationships with guests.
