How to use big data in the hotel industry?

The rise of social media and the use of mobile devices results in a massive growth in generated data. Big data contains a lot of useful information about your (potential) clients, but how can you use this data to book success? Not only the enormous extent makes it complicated but also the variety of data sources makes it hard to gather valuable information that can be useful for your business (Tuil, 2011).

Data mining is the solution to find connections in large datasets and this strategy can play a big role in the hotel industry to maximize customer engagement. With datamining you analyze large quantities of data in order to discover meaningful patterns, trends and possible threats. For hotels it is necessary to use data mining in order to sift through massive data so they can anticipate to customer needs and eventually build a valuable relationship (Chamelian, 2015).

Without datamining, valuable marketing insights may be missing, like customers’ characteristics and purchase patterns. Because success not only depends on collecting data, but more so on how well you are able to convert this data into useful information that can help to manage your business and be successful. Data mining can help to formulate marketing strategies, improve guest experiences, increase loyalty and can eventually lead to maximize profits (Chamelian, 2015).

Data mining techniques help to discover patterns and relationships that can be used to predict the potential value of each customer. Because a returning customer is always cheaper than attracting new ones.
Data mining can help to:

  • Create direct-mail campaigns
  • Plan seasonal promotions
  • Plan the timing and placement of ad campaigns
  • Create personalized advertisements
  • Define which market segments are growing most rapidly
  • Determine the number of rooms to reserve for wholesale customers and business travelers (P.Magnini, Honeycutt, & K.Hodge, 2009)

Especially seasonal promotions is a key element for hotels. For example, if the online behavior is changing and people are searching for a particular destination in the winter season, the hotels can adapt to this behavior and change their online promotion.

Customers’ needs, preferences, wishes and behavior is always changing and it is crucial for businesses in the hotel industry to continuously adapt and react to these changes. Data mining is necessary to keep being relevant towards your customers and stay ahead of competitors (Kim, Lin, & Wang, 2009).

 

Bibliography

Chamelian, S. (2015, September 9). Using data mining and analytics to your hotel’s advantage. Opgeroepen op Oktober 2, 2016, van eHotelier.

Kim, S., Lin, L.-C., & Wang, Y. (2009). Data Mining Applications in the Hospitality Industry.

P.Magnini, V., Honeycutt, E. D., & K.Hodge, S. (2009). Data Mining For Hotel Firms: Use and Limitations.

Tuil, K. v. (2011, Augustus 26). Wat is datamining? Opgeroepen op Oktober 2, 2016, van Computerworld: http://computerworld.nl/business-intelligence/74941-wat-is-datamining

 

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