Using Marketing Information to Inform Strategy

Data-driven decision-making (DDDM) is transforming the tourism industry, particularly for destination marketing organizations (DMOs). By leveraging data insights, DMOs can make informed decisions to attract high-value travelers, optimize marketing strategies, and enhance tourism growth. Below is a summary of the resources and their connection to DDDM.

Mastercard Tourism Insights

Mastercard’s Tourism Insights^[1] platform emphasizes the importance of using multiple data sources to gain actionable insights throughout the traveler journey.

These insights help DMOs:

• Identify high-value tourists based on spending patterns and preferences.
• Optimize marketing investments by targeting the right audience segments.
• Stay competitive in a dynamic market with changing consumer behaviour and increased competition.

For example, Mastercard’s platform provides detailed analytics on traveler spending habits, enabling DMOs to tailor campaigns that maximize return on investment (ROI) and attract tourists who contribute significantly to local economies. This aligns with DDDM by ensuring decisions are based on empirical evidence rather than assumptions.

“Using Data to Help Drive Tourism Growth” [2:10 min] by Mastercard News^[2]

Destination BC

Destination BC uses research and insights^[3] to support tourism stakeholders in British Columbia.

Their approach includes:

• Providing data on visitor trends, demographics, and economic impacts.
• Helping industry partners and governments make informed decisions for marketing and development projects.
• Offering tools like market segmentation analysis to refine targeting strategies.

By supplying timely and relevant data, Destination BC empowers tourism operators to align their efforts with market demands, ensuring resources are allocated effectively. This highlights the role of DDDM in enhancing strategic planning and operational efficiency.

Destination Canada

Destination Canada’s research initiatives^[4] focus on providing centralized access to tourism data through platforms like the Canadian Tourism Data Collective^[5].

Key activities include:

• Producing regular market intelligence reports on traveler behaviour, economic impacts, and industry trends.
• Partnering with organizations like Statistics Canada to offer reliable and secure data.
• Supporting businesses in marketing to international travelers by offering insights into global travel trends.

For example, Destination Canada’s Data Collective enables stakeholders to access real-time data for decision-making, such as identifying emerging markets or adjusting strategies based on seasonal trends. This demonstrates how DDDM fosters agility and innovation in responding to tourism challenges.

“Canadian Tourism Data Collective Webinar” [53:35 min] by Destination Canada^[6]

Here are examples of organizations that effectively use marketing information and systems to inform their strategic decisions and optimize marketing efforts.

Amazon^[7]:

• Use of Data-Driven Marketing: Amazon is renowned for its sophisticated use of data-driven marketing strategies. The company collects vast amounts of customer data from its website, emails, and other digital platforms to create personalized shopping experiences. This data is used to tailor product recommendations, suggest add-on items, and optimize search results.
• Strategic Impact: By leveraging customer insights, Amazon enhances customer loyalty and engagement, driving increased sales and repeat purchases. The personalized approach not only improves customer satisfaction but also helps Amazon maintain a competitive edge in the e-commerce space.

Starbucks^[8]:

• Implementation of Marketing Information Systems: Starbucks utilizes its customer loyalty program and mobile app to collect data on customer purchases, preferences, and behaviours. This data-driven approach allows Starbucks to deliver personalized offers and recommendations to each customer.
• Strategic Impact: The personalized marketing efforts have resulted in higher engagement rates, increased sales, and improved customer loyalty. By enhancing the customer experience with relevant and timely offers, Starbucks strengthens its brand and fosters long-term customer relationships

Marriott International^[9]:

• Use of CRM and Data Analytics: Marriott International leverages its CRM system to gather and analyze data from its extensive loyalty program, Marriott Bonvoy. This system collects information on guest preferences, behaviours, and feedback — allowing Marriott to personalize guest experiences and tailor marketing campaigns.
• Strategic Impact: By using data-driven insights, Marriott can offer personalized promotions and services, enhancing customer satisfaction and loyalty. This approach helps Marriott maintain a competitive edge by delivering unique and memorable guest experiences, ultimately driving repeat business and increasing revenue.

Expedia Group’s strategic use of marketing information systems (MIS)^[10] exemplifies the concepts discussed in this chapter, demonstrating how data-driven decision-making can transform a company’s marketing approach and customer experience in the travel industry.

Background

Facing challenges with a fragmented structure of 21 brands, Expedia Group undertook a significant technological transformation to unify its platform and leverage the power of data and AI across its operations.

Implementation of MIS Components

Expedia’s approach aligns closely with the four key components of a marketing information system:

1. Internal Records System:
   • Consolidated 70 petabytes of traveler data on a unified AWS cloud platform
   • Streamlined data from multiple brands for comprehensive analysis
2. Marketing Intelligence System:
   • Utilizes advanced analytics to monitor market trends and competitor activities
   • Employs AI to analyze customer behaviour patterns and anticipate market shifts
3. Marketing Research System:
   • Conducts ongoing analysis of customer preferences and booking patterns
   • Integrates feedback from various touchpoints to inform product development
4. Marketing Decision Support System (MDSS):
   • Implements AI-powered tools for predictive analytics and personalization
   • Utilizes data insights to optimize pricing strategies and marketing campaigns

Key AI-Driven Innovations

Expedia’s MIS has enabled several cutting-edge features:

1. AI-Powered Trip Planning:
   • Integrated ChatGPT into the Expedia iOS app for conversational trip planning
   • Offers personalized recommendations based on user preferences and historical data
2. Smart Hotel Shopping:
   • Uses machine learning algorithms for dynamic pricing and personalized hotel suggestions
   • Analyzes traveler characteristics and trip details to enhance the booking experience
3. Automated Customer Support:
   • Deployed AI-powered virtual agents to handle customer queries
   • Processed over 30 million conversations, saving significant operational costs

Impact on Marketing Strategy

Expedia’s use of MIS has resulted in:

• Enhanced Personalization: Tailored marketing messages and travel recommendations for individual customers
• Improved Customer Acquisition and Retention: Leveraged CRM systems to understand and predict customer behaviour
• Operational Efficiency: Saved approximately $150 million in one year through AI-powered customer support
• Competitive Differentiation: Positioned Expedia as a leader in AI-driven travel services

Expedia Group’s case demonstrates the transformative power of a well-implemented marketing information system in the travel industry. By integrating all four MIS components and leveraging AI, Expedia has created a data-driven marketing strategy that enhances customer experiences, improves operational efficiency, and drives innovation in travel planning and booking processes.