The Benefits and Challenges of using Customer Data for Marketing
Hello my hospitality friends,
Welcome to our next blog instalement, today
we are going to discuss the benefits and challenges of using Customer Data for
Marketing.
In our modern digital age, it would be difficult to plan an effective marketing strategy or campaign without understanding our customers. In essence, that’s what customer data truly is, information. Having access to customer data (demographic profiles, preferences and interests etc) is now just part of operating in the connecting business world (Data is gathered electronically for bookings, processing payments etc). The main benefit to holding and utilising this data is that it allows your business to segment and align your future marketing strategies and campaigns to specific categories of your customers (e.g. age & spending profiles). You can also align offers and messages to their specific interest (midweek deals for business travellers or weekend breaks for couples/families). This ability to target more effectively utilising a variety of customer data points will in turn lead to additional benefits including increased brand awareness and customer loyalty (as your customers will feel that your messages and campaigns that they receive are more targeted to them – they begin to associate your brand with their buying decisions). In addition, this targeting increases return on investment as you are aligning your marketing activities to a well-defined subset of your customers who are therefore more likely to engage with it and will result in higher conversion rates/ bookings.
However it is important to remember that with these benefits come the responsibilities, firstly is the need to disclose use (i.e. your customers need to consent to the use of their data for marketing purposes) and you need to find ways to maintain your data to ensure its up to date and accurate, so its ongoing requirements. In addition, there are significant obligations under GDPR (General Data Protection Regulations) that must be observed when collecting, processing and utilising data, failing to adhere to these guidelines can cause serious business, legal and reputational risks.
There will also be a need to put internal process and procedures in place to
deal with SARs (Subject Access Requests) where your customers can exercise
their rights to copies of all data you hold about them. Meeting these
obligations can be complex and time consuming. Most organisations especially in
service industries like hospitality, utilise CRM (customer relationship
management) tools/systems to ensure that have the right infrastructure to
gather, maintain and best utilise customer data. These systems can be costly,
but the right investment can ensure you get maximum benefits for both Marketing
and broader business intelligence purposes.
At premium digital out team of experience
with deep hospitality sector knowledge can assist you to map out your customer
data environment and provide advice on systems and how to maximise the data for
most effective marketing activities. Reach out to us today and we can
help you on your customer data journey.
#CustomerData #GDPR #Hospitality
For more information on "The Benefits and Challenges of using Customer Data for Marketing" you can read more Premium Digital blogs.
Premium Digital Working for Success in Hospitality.
Written by Mark Conmee
References: EHL Insights. 2022. Data Security in Hospitality - Risks and Best Practices . [online] Available at: https://hospitalityinsights.ehl.edu/data-security-in-hospitality-best-practices
Hi Mark, this is a great blog! It is so true that "customers need to consent to the use of their data for marketing purposes" and it is unbelievable that there are websites out there that gather data without the consumer's consent. Hoteliers need to be careful with the way they handle customer's data and this is something we can help with at Premium Digital! - F,Pinate
ReplyDeleteThis is a great read Mark. In a hotel, while most bookings come in electronically there is also so much information taken via the phone when customers call to book and also on check-in so all this information is reliant on the staff to input this correctly into your system for marketing purposes. When information is input incorrectly you are losing the chance of a future sale. As you mentioned GDPR must be observed and this is everchanging so it is important to have a data protection officer to oversee this. Overall great read, well done.
ReplyDeleteOnce again a warm friend introduction to the blog which I love. You outline and summarise very well the benefits of customer data and how it assists in executing your marketing strategy. You highlight the key challenges of using customer data and suggestions on overcoming the challenges such as investment in the right systems and infrastructure however another challenge in the hotel industry is the lack of resources and training of the staff on using these systems correctly. Data extraction from CRM systems is only effective and accurate if the information is inputted correctly in the first place and this is definitely a challenge that hotels face!
ReplyDeleteSuper friendly tone of voice for this blog Mark. You are correct we need to know our customers, without knowing our customers we are blind and deaf to their needs and as a result the feel disconnected. Data does allow hotels and other accommodation providers to segment and target the correct audiences for a property, however it is important that the team have been adequately trained in using the software. Great read.
ReplyDelete