In our recent webinar, “Intelligent Customer Service for Travel & Hospitality“, Omer Minkara, Vice President and Principal Analyst for Aberdeen Strategy & Research joined Uniphore’s Chief Marketing Officer, Annie Weckesser, to discuss the top CX trends, challenges and opportunities shaping the travel and hospitality industry. Couldn’t attend the live event? We have you covered. Read on for part three of our webinar recap: How to Improve the Lifetime Value of the Travel Customer.
Why Customer Lifetime Value is So Precious—and Elusive—to the Travel Industry
According to research by Deloitte, the number of digital bookings this year is poised for double-digit growth. At the same time, more digital players are reaching for bigger and bigger pieces of the travel market pie. So, while customers are hungrier for travel than in previous years, they also have more options at their fingertips than ever before. As a result, travel service providers can no longer rely on customer loyalty alone to drive lifetime value. In today’s digital-first marketplace, securing the elusive lifetime customer requires businesses to rethink their digital experience and find new ways to offer differentiated, highly personalized service.
Common Pitfalls that Undermine Customer Lifetime Value
Travel can be exciting. It can also be incredibly stressful when plans go awry. While some circumstances are unpreventable (i.e. if a traveler gets sick), others are completely controllable. Weckesser shared a personal story about how a reservation she made online was later cancelled because the travel provider didn’t have the available room—despite the booking site showing otherwise and the automated system emailing her a confirmation. When she tried calling customer service, she was met with a 20+ minute hold before being instructed to email a separate company with her issue. At the same time, she was charged four times for a reservation that couldn’t be completed.
“The impact that this has is that now I’m shifting my brand preference and potentially spending my vacation time elsewhere,” she reveals. “This was such a missed opportunity [for the travel provider].”
Weckesser’s experience is certainly not the exception. Popular travel community boards are rife with similar horror stories. And the post-pandemic rush toward digital transformation has only added to the communication challenges travel companies face. Those that blindly adopted digital CX tools or implemented stopgap solutions without considering their end-to-end ramifications are now struggling to attract and retain customers who have come to expect an effortless experience in all their digital interactions.
Top Actions for Improving Lifetime Value Today—and Tomorrow
To improve retention—a major driver of lifetime value—Minkara recommends that companies first look closely at the root causes of customer churn. “Find out what’s driving churn across your clients, then start listening to the voice of the customer to find out what customers are seeking,” he advises. “A lot of the brands that we’re interacting with in travel and hospitality are collecting this information, but unfortunately, they’re not acting on it.”
Weckesser agrees. She encourages travel service providers to comb the entire customer journey for any inconsistencies or shortcomings.
“You really have to ask yourself: do you believe your customer experience is consistent across product, across service, across digital? Do you truly know the sentiment of your customers without ever having to ask them? And are you as productive and responsive as when the pandemic first struck?” She asks. “Ultimately, how can you be more intentional about unlocking the value of every conversation?”
With artificial intelligence and automation. As we explained in part 2 of our webinar recap, travel companies that leveraged conversational AI and automation in their customer journeys saw 10.5% year-over-year growth in customer retention (compared to 3.2% growth for non-users). That’s because AI-enabled systems unify and analyze data from different customer touchpoints while automation simplifies and streamlines complex, backend tasks that slow journeys and frustrate customers.
Building Lifetime Value with the Right CX Partner
However, not all AI and automation solutions are created equal. Weckesser urges companies shopping for a conversational automation vendor to put their business needs first and avoid the lure of flashy one-size-fits-all solutions.
“Find a partner that is going to innovate with you and deliver on your organization’s natural roadmap for AI and transforming the customer experience,” she advises. She goes on to explain how the right solution should optimize every step of the customer journey—from before the point of contact to after the interaction has ended.
“My vision is for a company that knows [the individual customer] and can create memorable experiences in every conversation and every interaction,” Weckesser states. “With proactive digital outreach and digital engagement, they can boost engagement, renewals and membership.”
By using AI and automation to build engagement—not merely expedite problem resolution—travel and hospitality companies can forge stronger connections with their customers and foster greater loyalty. That translates to better customer retention and higher lifetime value.
Couldn’t attend the webinar?
Intelligent Customer Service for Travel & Hospitality