Hyper-Personalisation in Travel: What's Next?

Travel is getting more personal.

Customisation in the travel industry is rapidly growing, with forecasts predicting that global personalisation in the travel market is expected to increase at a compound annual growth rate (CAGR) of around 17% between 2022 and 2032.

Of course, personalisation in travel as a concept is not new – especially when it comes to the hospitality experiences to which travellers have become accustomed. However, travel continues to get more deeply personal, and this is reflected in the global appetite for bespoke experiences, with the global customisation and personalisation in travel market size expected to reach US$620.71 million by 2032.

Technology is shaping nearly every aspect of personalisation, enabling new ways of offering bespoke travel experiences across the industry. As part of that, artificial intelligence (AI) is everywhere, not just in the travel and tourism industry, and its integration isn’t slowing down. In fact, it's estimated that around 60% of global businesses have implemented AI tools to improve customer service and efficiency.

So, what are some key examples of how AI and hyper-personalisation is used effectively, and how does this benefit travel businesses across the industry?

Before we get into that, however, why not explore how we at Hotelbeds offer intelligent, data-driven solutions as a leader in the TravelTech space and as part of HBX Group, by discovering how we enable success for travel businesses across the industry.

How Does Technology Enable Hyper-Personalisation?

• AI and Machine Learning - analysing traveller data to identify patterns and preferences and enabling advanced data analysis to anticipate needs.
• AI Chatbots - providing real-time, personalised assistance.
• Location-Based Services - offering relevant deals based on a traveller's location.
• Virtual Tours – showcasing facilities and experiences to help potential travellers understand offerings.
• Big Data – the collection and analysis of large volumes of information to gain valuable insights into customer behaviour.
• Customer Relationship Management (CRM) systems - centralise guest data and collect information from multiple touchpoints.

Hyper-Personalisation is the Future of Customer Experience

The theory of hyper-personalisation is that it’s the most advanced way that brands can tailor their marketing to individuals, through the use of analytics, AI and automation. But, what does it mean in practice?

At our recent HBX Group MarketHub summit, our Senior Vice President for Global Sourcing, Paul Anthony, broached the topic of hyper-personalisation. In his panel, he suggested that: ‘Hyper-personalisation is the holy grail in travel, creating that ‘one-to-me' experience.’ Driving customer experiences pre- and post-booking, which are seamless, frictionless, and tailored to their personal needs and preferences.

When it comes to the customer experience, hyper-personalisation and AI play a role in allowing travel companies to determine the needs and desires of their audiences at a much more granular level.

AI tools enable companies to deep dive, and better profile their audiences – both ideal and current – therefore empowering these companies with customer knowledge which can be used to improve the experience for our customers with more personalised experiences.

This manifests in a number of ways:

Hyper-local Recommendations

Technology is destined to play an expanded role in developing experiences in this sector. In-house trained AI models are increasingly delivering personalised recommendations for travellers to explore local destinations. This is currently employed by many operators, like SmartGuide, who offer personalised itineraries for over 100,000 destinations.

Personalised Travel Experiences

Tools like Insights – our powerful, customisable tool which offers market-specific recommendations – and Google Travel curate itineraries based on traveller preferences, while startups like Bigfoot’s LightFoot chatbot uses natural language processing for intuitive interactions.

Meanwhile, ‘personalised flying’ is expected to be a key trend going forward, thanks to airlines combining algorithmic entertainment with hyper-personalised in-flight systems.

Predictive Analytics and Dynamic Pricing

When it comes to predictive analytics, the use of temporal fusion transformers, or TFTs, is making waves at HBX Group, our parent company. A complex attention-based architecture specifically designed for time series forecasting, a temporal fusion transformer captures temporal-based patterns across multiple time sequences. This allows for: multi-horizon forecasting, interpretable predictions, and probabilistic forecasting.

What does this mean for you? The use of TFTs allows companies like us to predict bookings, revenue, and market trends with precision. We can forecast sales opportunities to a high level of accuracy, maximising your potential thanks to the power of predictive analytics.

Hyper-Personalisation and Hospitality

In hospitality, many hotels are leaving behind the basic offerings of old, and introducing new ‘value adds’ for guests to set them apart.

Personalised travel is taking on all-new meanings. Such instances are seen in the demand for ‘micro-hospitality', where travellers are free to curate their own private getaway at a pared down price, to 48% luxury travellers wanting exclusive experiences, and the growth of ‘experience agents’ who deliver bespoke guest experiences during their stay.

Virtual assistants in rooms are becoming an expectation, as are chatbots on customer service platforms, while the innovative app Timeshifter creates plans based on guests’ chronotype, normal sleep pattern, itinerary and personal preferences to tackle the underlying cause and symptoms of jet lag.

However, there is potential for improvement in connectivity between hotels and travel bookers. Fernando Vives, Chief Commercial Officer& Management Board Member at Minor Hotels Europe & Americas, also mentioned at our HBX Group MarketHub that while travellers can choose rooms based on preferences at check-in, partnering with a TravelTech specialist – like Hotelbeds and parent company HBX Group – could further streamline data flow and enhance the current personalisation opportunities.

For example, while guests can and have been able to select a room during check-in, the capability exists for the industry to offer even more personalised experiences, catering to unique, individual circumstances to uplift each guest’s experience and thus the emotional connection to that brand, or hotel during their stay.

Optimising Travel Operations with AI

There are numerous practical applications of machine learning in areas such as pricing, demand forecasting, and operational efficiency.

For sustainability, Google’s DeepMind is helping airlines to optimise flight paths to reduce contrails, while intercity rail and bus operators are using AI to improve fuel consumption. In baggage handling, AI image recognition streamlines the process, significantly reducing delays and frustrations for travellers dealing with lost luggage.

From an operational perspective, AI chatbots are freeing up human service providers to assist with complex issues by being available 24/7, thereby alleviating some strain on customer experience teams.

Chatbots are also reducing the friction experienced by customers, offering readily available assistance at the exact time of need – and at Hotelbeds we have our own AI chatbot tool, Olivia. This intelligent virtual assistant offers quick, intelligent solutions to queries regarding the first steps of your journey with us, or indeed more information about our products, services and business model.

Furthermore, our virtual assistant is on-hand to offer increased support with technical queries, from making bookings to using our comprehensive self-service tools, as well as in-destination support even during emergencies. This tool is enhanced with the ‘eight building blocks of conversational AI’, to ensure intelligent, contextually accurate support, streamline ways of working, and reduce friction at all stages of the travel journey.

Hyper-Personalisation and Travel Marketing

At HBX Group’s MarketHub 2024, Rebby John, Senior Director of Sales Engineering at Saleloft, noted that customers are likely to spend 67% more if they enjoy a better sales experience, while Ali Ozbay (VP of Marketing & Communications at All Inclusive Collection and Rixos Hotels) emphasised the shift away from a one-size-fits-all approach, as travellers increasingly seek exclusive and personalised experiences.

Hyper-personalisation starts at the customer's initial 'dreaming' phase, and targeted advertisements that resonate with specific audiences help establish a connection and speak directly to their needs.

Businesses can create unique online experiences for varied client types, utilising intelligent data platforms to develop personalised offers based on real-time customer data. This approach ensures that different traveller groups receive tailored messages, enhancing the chances of closing the sale.

Intelligent Campaigns to Ensure a Right Product, Right Time Approach

Connecting supply and demand is one thing – reaching the right audience at the right time is another.

Utilising intelligent campaigns helps you offer your ideal customer the product they’re looking for, at the moment when they most want them. How? At Hotelbeds, our advanced algorithms predict which properties and conditions are most suitable for your customers, while our dedicated experts constantly monitor their success in the background.

This aspect of hyper-personalisation is key for travel businesses, as you’re benefiting from an AI algorithm which delivers promotions relevant to you and your market, optimising your success in a competitive space.

Personalised Recommendations at Your Fingertips

Leveraging strategic growth opportunities, such as those delivered by our intelligent recommendation tool, Insights, opens additional possibilities to offer relevant, incentivising trips and experiences to travellers. 

These are data-driven, tailored to the specific needs of your market based on:

• historic travel search data
• real-time market data
• an awareness of seasonality
• historic booking and itinerary data

This allows you to continually adopt that ‘right product, right place, right time’ approach to your marketing strategies, therefore personalising each marketing communication to the stays and experiences most likely to resonate with your intended audience.

Personalised Offers

Research shows that 92% of shoppers value sharing personal information for discounts, and trust and transparency in data usage are key for brands. This data can be utilised in thoughtful gestures to significantly enhance customer satisfaction and brand reputation.

A key example of this is seen in British Airways and Virgin Atlantic’s decision to remove ‘ladies and gentlemen’ from announcements, leveraging data insight to drive inclusivity; additionally, Virgin Atlantic offer gender-neutral options during booking. Initiatives like this can truly work wonders, enhancing customer relationships, increasing brand affinity (the emotional connection between a brand and its audience), and brand loyalty as a result of acceptance, visibility and belonging from the customers’ perspective.

Customers feel valued through thoughtful marketing strategies, such as customised promotions and considerate emails regarding promotional exclusions.

Important considerations for personalisation include:

• Detailed data collection: gathering comprehensive traveller preference information, including preferred destinations and travel dates.
• Dynamic recommendations: using algorithms for real-time suggestions aligned with individual interests.
• Contextual awareness: incorporating factors like current weather conditions, local events, and nearby attractions to provide relevant offers based on the traveller's current situation.

Hyper-Personalisation and Travel – What Does This all Mean?

As AI becomes more integrated into travel, businesses can leverage it alongside big data to enhance customer loyalty. Travel experience providers of the future will be able to leverage customer data on loyalty plans, credit card benefits and insurance coverage, for example, crafting highly tailored travel plans.

For instance, tour operators benefit from interconnected distributors like Hotelbeds, ensuring competitive offerings and frictionless booking experiences as a result of data-driven, intelligent tools and booking platforms, alongside an expanded portfolio.

Utilising API connectivity allows a more frictionless booking experience, and by becoming an integral part of that seamless booking journey, providers are securing their relevance.

For travel businesses like Online Travel Agencies, however, innovation lies in using AI tools to build and price new trip itineraries and streamline online booking services. Around 80% of all global travellers want to book their trips online, 56% of travellers want to book activities and experiences in advance, and not only this, but 60% of travellers say they prioritise booking travel with one brand or credit card to maximise loyalty points.

This compounds the importance of offering comprehensive travel experiences for end travellers, and the opportunities to use AI tools and solutions to personalise these booking experiences to capture demand.

Overall, AI offers valuable chances to leverage data, analytics and business intelligence from various sources, to anticipate demand, and tailor offerings accordingly.

Companies that address this delicate balance, offering reliable, personalised, and secure travel experiences, will be the ones who shape the industry and benefit from it.

However, if you’re interested in exploring how we at Hotelbeds, as a key travel distributor and key player in the TravelTech space, offer intelligent, data-driven growth opportunities as a result of our powerful suite of TravelTech solutions, expert destination teams, and dedicated Account Managers, then explore why travel businesses across the industry benefit from a partner like us here.