Online travel business is fast-paced, competitive and swamped in data. XML data and XML insights in particular is what I have in mind. Searching for travel products such as tours, hotels, airlines and cars generates ever increasing look-to book ratios. The more players that participate, the more distribution channels there are for travel suppliers to get their customers from, the more complex the web of data becomes and the greater the volume. Harnessing that data and getting it into a visual state where it is not only seen but actually used to make revenue impacting decisions – is stating the obvious challenge. Search and booking data streams (usually in XML) is the lifeblood of online travel. The ability to read and act on that data is literally a competitive differentiator that no travel company should ignore.
We all know online travel is big and getting bigger. Last year online travel agents (OTAs) had combined bookings of $278 billion, according to Euromonitor, a market-research firm who also believe that by 2017 over 30% of online travel bookings by value will be made on mobile devices. PhoCusWright, another research firm, reckons that online booking now accounts for 43% of total travel sales in America and 45% in Europe. Other markets including China are on an explosive growth road.
Tackling the Look-to-Book Explosion…
Burgeoning look-to-book ratios, caused by people’s incessant search for value and the proliferation of travel distribution intermediaries, continue to be the travel industry’s nightmare. A high volume of search requests against a low volume of bookings has expensive consequences for infrastructure and resources. Many of these intermediaries (such as Meta search engines) are designed to look at inventory from travel supplier websites in order to populate their own.
So I am sure it is also obvious to anyone involved in the distribution chain of these travel products or accounting for revenue from them that analysing the content of XML search and booking transactions in real-time can deliver a wealth of insights about the customer, the product itself or other partners in the supply chain. Valuable insights that have the power to keep the travel business on the most profitable track.
How? By making it visually obvious where performance is below par or financial opportunities are being missed. Insights for a hotel for example could include showing the best performing distribution channel, or which distribution channel burdens the CRS system with high search volume but low volume and perhaps even lower value bookings?
…Through the Lens of XML Data
Understanding what the buying behaviours of customers of customers are and being timely and relevant in offers and price is every travel company’s strategic ambition in reducing look-to-books. Having the right data and being able to use it to make timely decisions is the logical step to future survival. For this reason data visualisation is increasingly important. XML analysis and what it means to a business can be brought alive with rich data visualisation. The analytics platform churns through an immense amount of raw XML data to extract meaningful information about the nature of the travel company’s searches and bookings. The output spills into easy to read dashboards and reports for the increasingly diverse end-users who are hungry for the insights that can help them drive results. Revenue Managers, Marketing Managers, Distribution Managers in a hotel context increasingly need to combine insights and forces, and all are classic beneficiaries of this analysis.
Managing Distribution Channels With XML Insights
How measuring XML search traffic in relation to bookings helps travel companies identify poor performers and better manage their distribution channels by focusing on the most profitable business streams.
One of the key challenges travel suppliers, especially hotels, face is how to deal with the ‘look-to-book’ ratio on their systems and whether caching technology to buffer the request volumes is the answer. Well this approach, although it sounds quite good has the inherent risk of hotel room reservations not being captured in real-time, and the hotels therefore not truly knowing their correct, real-time supply situation. Since pricing (and therefore revenue) is closely related to availability – the best decisions with regard to price and channel may not be being made. And every hotelier knows not all distribution channels are equal. Some (like the big OTAs) cost more in commissions and payments per booking than others. Having a granular sliced and diced view of shopping traffic as well as actual booking data can help a marketing or revenue manager figure out if the room type and price is right for the search context and the channel or if opportunities to get listed are being missed.
Turning data findings into easy to read tables and charts helps improve decision-making and ultimately improves the entire organisation of a company.
As the use of business intelligence and advanced analytics technologies proliferates in more companies and plays a bigger and bigger role in business success, deployments of data visualisation software and tools are also expanding – and evolving. Business Intelligence (BI) and Information Technology teams increasingly are getting requests from business users for data visualisation capabilities, often delivered through user-friendly dashboards, to help meet BI objectives.
‘Seeing is believing’ is an old-age saying that rings true. People are instinctively better at processing information by visualising. The most succinct way visualisation creates a universal language to understand complex notions. Through visualising data people get sense of ownership over it, and this empowers them to act on it.
So if you are not already decoding your XML data to get those nuggets of insights into business performance – maybe it’s something you should consider in your 2015 business planning.