In the quest to drive more value from across the business, online travel companies are keenly looking at data-driven analytical intelligence, writes Ritesh Gupta

Expertise in data management is something that online travel agencies are diligently striving to improve upon. In fact, related tactics are being improvised for key areas like revenue generation.  

Decision-making in the travel sector today happens in real-time, so it doesn’t come as a surprise that the time to implement advanced analytics has fallen from weeks and months to hours and days. Expedia, for example, has adopted a ‘fail-fast’ culture to experiment with new ideas, and fit the findings into their operations as quickly as possible.

The aim in all this is to drive fresh revenues and in such an environment it’s crucial that applications such as business intelligence and data mining work in unison with enterprise resource planning and CRM systems. After all, in the digital environment, the window of opportunity is limited.

Here we explore three key OTA operational areas that are dependent on data management and business intelligence:

1.    Improving conversion rates: Traffic monetisation can be a big source of revenue but there is still plenty of room for growth. A big issue here is how to monetise traffic that hasn’t converted. Says Philipp Brinkmann, CEO, tripsta.com: “Since the conversion rate of most OTAs is somewhere between one and five percent the question is: how do you monetise the remaining 95 % of your traffic?”

For many years most OTAs focused on boosting conversion rates. However, it is not possible to grow to do this continuously, says Brinkmann, and so recently there has been a shift in focus. “The trend is towards placing paid ads of competitors within the results. Even hybrid OTA/meta-search models are being tested. However, most OTAs are still experimenting,” he says. Profiling and data intelligence is definitely becoming more and more important and will be an integral part of the traffic monetisation strategy. “Data management will allow to dynamically price as well as sell the right products to the customer at the right time, depending on the device, location, distribution channel,” adds Brinkmann.

Agencies today store huge amounts of data like searches, bookings and so on but the real challenge is to aggregate all this data and then use it to deliver improved, targeted customised offerings to travellers. Then it is possible to improve conversions.

2. Product improvement: One of the merits of being an online brand is the ability to gather real-time data which can help in product development. To this end, OTAs are looking at and working on every available bit of data to improve the experience for visitors. For instance, new tools for the lowest available flight prices are emerging in the market. So, for example, rather than relying on web service requests to GDSs and airline systems, for the lowest fare search for thousands of city pairs, agencies are looking at caches to improve their offering.

To this end, a few months ago tripsta.com announced a new search engine, Price Radar. Still in beta, the aim is to allow travellers to spot the best price for up to a six-months period in less than a second. The process started with Amadeus working out a custom pre-computed cache for tripsta. From here, the team focused how to display the results the best way possible. To put this in perspective, a city pair for London-Athens can feature around 3700 results so it was important to display the relevant results in a precise manner, and as fast as possible.

3. Attribution: The quality of data available must be continuously refined. This is an important development given that the quantity of digital information a user generates is substantial. Once refined, this pool of data forms the basis for market attribution, something that Expedia, and other OTAs, are counting on to determine its marketing initiatives and investments. Being systematic in addressing data access, data integration, data quality and data governance, isn’t an option but a necessity.