Customer Knowledge Management: the key to increased competitiveness

The tourism industry is an extremely competitive environment in which travel agencies continuously seek ways to increase their competitive advantage. Customer knowledge (CK) provides the opportunity for travel agents to gain competitive advantage, given that the new customer knowledge is produced continuously and managed effectively (Chua & Banerjee, 2013). Customer knowledge management (CKM) helps managing customer knowledge gathered through interactions between the travel agent and the customer.

Data has to be gathered continuously and regular quality checks should be done for CKM to be effective. Hiring customer knowledge managers is recommended due to constant changes in customer characteristics and behaviors. Eventually, the goal is to develop an intense relationship with each individual customer. CKM helps doing this by forming an image of the person not only as a buyer, but also as a person.

CKM has proven to be extremely costly, but international corporations such as Quicken, Amazon and Starbucks illustrate its worthiness and effectiveness. According to Chua et al. (2013), social networking services (SNS) provide new opportunities for customer data collection. Due to the relatively low costs as well as the higher levels of efficiency, Chua et al. (2013) argue that organizations incapable of utilizing these SNS are at a strategic disadvantage. Platforms such as Facebook and Twitter allow customers to publicly share their opinions regarding certain products, organizations or situations. As an organization, this information can be utilized in order to understand their needs and wants. Simultaneously, customers will be able to understand the organization, their products and services better.

Within the tourism industry, CKM enables travel agents to recognize customer needs before the customer even recognizes these needs himself. Personalized packages may be offered directly to the customer in order to show them you understand them and recognize their needs. Doubtlessly, it is impossible to implement CKM on an individual basis. Therefore, it is advisable to segment ones’ customers into multiple clusters. Based on these clusters marketing strategies can be created and implemented. More information on customer segmentation can be found in Therese Perschel her blog on customer segmentation and personas.

Starbucks provides an excellent example of how CKM can influence customer engagement and strengthen the bilateral relationship between them and the company. Chua et al. (2013) have conducted a case study on Starbucks and found that they manage to adapt their products and their branding through SNS. Starbucks combines micro blogging sites (MBS), SNS, location-aware mobile services (LMSs) and corporate discussion forum services (CDS) in order to connect with its customers. Simultaneously, customers freely express their emotions, feelings and thoughts on Starbucks, its products and its design. By analyzing this data, Starbucks is now able to accurately accustom its products to its customers wishes. An example of this location-based customization is a Starbucks in Singapore. Through Foursquare, Starbucks found that customers appreciated their new store design. Without this CKM they would have not been aware of the impact these changes have on their customers.

In conclusion, customer knowledge management can significantly increase the competitiveness of travel agencies. Through CKM and SNS, you become more aware of your customers, their travel related wishes and when they are in need of travel. Customers recognize your intentions and appreciate the efforts your travel agency makes. Therefore, they are more likely to return and thereby increase the competitiveness of your company.

Bibliography
Chua, A.Y.K. & Banerjee, S. (2013) Customer knowledge management via social media: the case of Starbucks. Journal of Knowledge Management, Vol. 17(2), pp.237-249, https://doi.org/10.1108/13673271311315196

Dehghani, M., Mehdibeigi, N. & Yaghoubi, N.M. (2016, May 2). Customer Knowledge Management and Organization’s Effectiveness: explaining the mediator role of Organizational Agility. Procedia – Social And Behavioral Sciences, 230(3rd International Conference on New Challenges in Management and Business: Organization and Leadership, 2 May 2016, Dubai, UAE), 94-103. doi:10.1016/j.sbspro.2016.09.012

Gibbert, M., Leibold, M. & Probst, G. (2002, October). Five Styles of Customer Knowledge Management, and How Smart Companies Use Them To Create Value. European Management Journal, vol. 20 (5), pp. 459-469, 2002. doi:10.1016/S0263-2373(02)00101-9

Knowledge Management Software (n.d.). Knowledge Management within the Travel and Tourism Industry. Retrieved 29 September 2017, from https://www.kpsol.com/wp-content/uploads/2015/09/Whitepaper-Knowledge-Management-in-Travel-and-Tourism.pdf

Peelen, E. & Beltman, R. (2013) Customer Relationship Management. p94-107. Harlow, United Kingdom: Pearson Education Limited.

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