Five things you need to know about the future of customer data privacy

The longstanding tug-of-war over customer data recently hit a tipping point – leaving far too many organizations flat on their heels.

We first saw this shift in mid-2018, when the EU General Data Protection Regulation (GDPR) officially came into effect, including provisions that provide EU citizens with control over how companies can use their personal information.

Then just months later, we learned about data breaches – massive in both size and scope – at U.S.-headquartered Facebook and Marriott. Facebook has long been scrutinized for the vast amounts of personal information that fuels its ubiquitous social platform. Now, hospitality customers are also thinking about all that data that makes frictionless guest experiences and loyalty programs possible.

According to a PwC survey, only 25% of customers believe that most companies handle their sensitive personal data responsibly. Moreover, 87% of respondents say they will take their business elsewhere if they don’t trust that a company is handling their data responsibly.

It’s also worth noting that the survey was conducted before the Facebook and Marriott hacks were even announced.

What does this mean for your business?

Plan for greater accountability and oversight

We just took a look back at events that are bringing conversations about data privacy and protection into the blinding light of day. The PwC report succinctly summarizes the challenges of here and now:

“If your customers don’t trust you to protect their sensitive data and use it responsibly you’ll get nowhere in your efforts to harness the value of that data to offer customers a better experience.”

You’re probably all too familiar with the rule of thumb when it comes to customer trust: It’s hard to win, and a lot easier to lose. We’re still in the early days of changes in regulations, accountability, and strategies that companies will pivot to in order to avoid protect reputation – and indeed, revenue. Here are some predictions that I think will help you navigate the change ahead:

  1. GDPR enforcement will pick up momentum In 2019. Google has already been fined $57 million (which the company is appealing) for, among other things, making its agreement terms obscure and difficult to access and burying its opt-out options. If you do (or plan to do) business in the EU, your organization needs to be in compliance.
  1. The U.S will see its own data privacy regulations. With the California Consumer Privacy Act of 2018, many tech companies actually embrace the idea of having consistent guidelines, rather than a patchwork of standards. Apple CEO Tim Cook asserts, “We will never achieve technology’s full potential without the full faith and confidence of the people who use it.”
  1. The Chief Identity Officer will enter the C-suite. Remember when organizations added Chief Digital Officers to lead digital transformation – in turn, leading to the need for Chief Data Officers, to explain, organize and exploit the value of data? Many companies will see a need for a Chief Identify Officer to codify policy and practices in the digital, privacy, compliance and security domains.
  1. Organizations will need rational data retention policies. During Anthem’s 2015 data breach, 78 million records were exposed, yet the healthcare provider and its affiliates only served 69 million customers; the remainder were likely former customers. Such lack of oversight sets organizations up for risk and stiff fines.
  2. Your supplier contracts will need to be re-examined. Given the domino effect that many observers anticipate GDPR having outside the EU, it’s a good time to review your partners’ policies, procedures and security controls to ensure that you don’t have any unwelcome surprises down the road.

We just finished observing the 12th annual Data Privacy Day – but recent events have underscored how there’s still considerable work ahead to ensure that we’re hitting the moving target of delivering customers meaningful experiences while protecting their personal information.

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Harnessing the power of bots in hospitality

The applications for chatbots in the hospitality industry will only continue to grow – as demonstrated in examples ranging from Marriott’s Slack integration for business travelers to the Henn na Hotel’s robo-dinos.

There’s a reason Gartner made this prediction:

“By 2020, the average person will have more conversations with bots than with their spouse.”

Chatbots make life easier for your customers. They’re accessible anytime, they provide instant answers to questions, and they learn as they go. They’re a cool drink on a hot day for the customer who used to have to go through several engagement channels – website, email and then a live agent, for example - for a resolution to a problem or question.

As a hospitality provider, bots, in combination with machine learning, can also make your life easier, by creating opportunities to upsell based on customers’ profiles and histories. For a customer who had previously inquired about a waterfront suite, a bot could offer a coveted suite at a special discount during a specified time window.

Incorporating bots into your customer service mix doesn’t come without its challenges – as my colleague outlined in "To Bot or not to Bot - the Promise and Pitfalls." But in this article, we’ll leave you with some of our favorite examples of innovative uses of the mighty chatbot for inspiration:

Casper

Can’t sleep? Created by mattress company Casper, Insomnobot-3000 (which is only available between 11 pm and 5 am) keeps insomniacs company by chatting about anything from Stranger Things to pizza to the latest World Cup results.

“Some nights, it’s just impossible to fall asleep, so I think Casper wanted to create something that’s a friend that keeps you up at night,” company VP Lindsay Kaplan told Venture Beat.

National Geographic

To support their new TV show “Genius,” featuring the life and works of Albert Einstein, National Geographic launched a Facebook Messenger bot where users could ‘chat’ with Einstein.

“Rather than having the campaign speak for Einstein, we wanted Einstein to speak for himself,” Layne Harris, 360i’s VP, Head of Innovation Technology, said to GeoMarketing. “This provides a more intimate and immersive experience for users to really connect.”

Duolingo

Learning a new language can be intimidating – enter Duolingo’s Chatbot language tutor. From speaking, writing and listening, the bot helps the user practice in a safe, risk-free environment – at any time of the day, for free.

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What your customers want from loyalty programs

When was the last time you heard someone gushing about a loyalty program - outside of an annual report or an investors’ conference? Customers today are more demanding than ever before as loyalty programs become part of the nondifferentiated status quo.

Flo Lugi, non-executive chairman of the Global Hotel Alliance, sums it up here:

“Most consumers initially join a loyalty program as a way to save money (thus the huge increases in membership by the hotel brands), but they also want something extra.”

According to Forrester, 59% of U.S. adults who are online and belong to a customer loyalty program say that getting special offers or treatment that isn’t available to other customers is important to them. For highly active members, that number rises to 69%.

Customers want more out of their loyalty programs, with 56% of U.S. adults who are online seeking enhanced customer services, such as member-only events or services. This is a growing trend that clearly demonstrates the importance of experiential rewards.

This is especially true for millennials, for whom the ability to capture “in-the-moment” cachet experiences and share them with their social network is extremely important.

Going from transactional to emotional connections

One of the biggest motivators of true loyalty is the emotional connection a customer has with a brand - yet most rewards in loyalty programs are based on transactions. How frequently that guest visits and how much she spends, versus why. Having these elements is only the beginning, as consumers evolve to expect “customized” offers and experiences, based on their actions, behaviors, and activities that go beyond a booking or stay.

To drive true value, loyalty programs need to be considered as only one part of an overall customer engagement and relationship management strategy, designed to evoke highly emotional responses in customers. Are intrinsic or extrinsic drivers guiding your guests to become repeat customers?

For this to work, profiles must be enriched with real-time data on customer interactions across offline and online touchpoints. Only by marrying transaction data with social, behavioral and activity-related data can companies provide highly personalized and contextually relevant experiences and drive customer engagement and, thus, true loyalty – and the rewards that come from it.

Customer experience is the sum of all interactions -  whether that occurs in the digital or the physical world – and it’s healthy for business that we keep raising the bar on customer expectations.

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Four key air travel innovations you’ll want to watch

More than ever, changes in the airline industry are impacting tourism as a whole, as travel becomes a more accessible experience globally. These customer experience (CX) innovations are worth a watch to keep your finger on the pulse of what’s happening with air travel.

Augmented reality

Air New Zealand has been working on augmented reality (AI) to create targeted in-flight experiences. The concept: Personalizing the experience by outfitting crew with the Microsoft HoloLens, which aggregates and displays on their lenses information - such as a customer’s preferred meal and drinks choice, travel plans and loyalty membership details.

The airline has also teamed up with a spatial computing company to create a digital multiplayer game that allows players to explore New Zealand in virtual reality. Watch it Here

Flights on demand (for short hops at least)

Uber has planned an on-demand fleet of electric vertical takeoff and landing (VTOL) aircraft that will roam cities as soon as 2020.

Air Bus has set up shop in Silicon Valley and is planning its own personal airplane proposition – also scheduled to “land” in the same timeframe. Reports are saying they are co-operating with Uber to crack some of the trickier problems.

The most interesting thing? The business model:

The cost of Uber Aeroplane per mile will be largely equivalent to using regular Uber in the car on the ground. Watch it Here

Flying subscriptions

Speaking of innovative business models – Surf Air has recently released their all-you-can-fly subscription service to customers in Britain and Europe. If you’re interested in learning more about why this pricing model works so well for them, check out this interview with Mac Kern, Vice President of Commercial Planning.

Equally important to Surf Air is the customer experience they deliver.  Below is a great example – a booking process that takes less than 23 seconds!  Watch it Here

Electric airplanes

Flying cars and electric airplanes they’re not as far away as we all think. Zunum Aero is aiming to change the way that people travel by producing “hybrid electric.” Boeing seems to be pretty on board with this, having invested in the company.

By the early 2020s, the company plans to operate electric aircraft to carry 10-15 passengers on trips up to 680 miles. It says, “The cost of such flights could be as low as $25 each way.” Watch it Here

At VXI, I’m focused on helping my clients innovate the customer experience. Let us know what you think of these ideas as food for thought about how you do business.

 

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Will coopetition be your next big CX move?

We’d all like to know what tomorrow’s customer experience (CX) might look like. Consider this ever-relevant quote by Bill Gates:

“We always overestimate the change that will occur in the next two years, and underestimate the change that will occur in the next ten. Don’t let yourself be lulled into inaction.”

As the world watches to see what nontraditional providers are poised to do next to disrupt the industry, big tech companies like Google and Amazon have been just (surprisingly) quietly poised to take their own bites out of the market.

What we’re also seeing is an intriguing blurring of the lines between competition and collaboration. It’s not new - in earlier days, this was known as coopetition.

Partnering to meet customer expectations

In one of the largest municipalities in the U.S., the rental-car service Avis has two partnerships with Waymo, Google’s autonomous-driving sibling. The relationship started with Avis servicing Waymo’s vehicles and now extends to Waymo’s self-driving vehicles transporting customers to and from Avis rental locations.

The upside in partnering with a digitally native company, says Avis Chief Innovation Officer Arthur Orduña, is hearing from customers, “Wow, I want to do that again and tell other people. Make it all digital, really mobile, reflect what people are expecting already."

The ‘why’ is now

Many organizations are partnering to leverage big tech’s digital expertise. Others are playing the waiting game, to avoid collaborating with what might become their most deadly competitor.

The other option is partnering with VXI, a trusted CX and contact center solutions provider for the world’s leading brands. We have the DNA of a startup, the strategic thinking of a consulting partner, and the analytical skills of a big data company. We’re passionate about collaborating with you on the strategic and operational initiatives that will drive positive outcomes for your business.

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Three hospitality trends to inform your 2019

Hotels have been on a record-breaking spree - with the industry valued at almost $1.6 trillion in 2017, and Deloitte projecting 5-6 percent growth throughout 2018.

There’s an age-old saying that a rising tide lifts all ships – but what happens when the tide falls?

Now is not the time to sit back and enjoy the generous returns – which is why we’re calling out three trends to consider as you shape your strategy for the coming year.

David vs. Goliath vs. AirBnB

There were a number of mergers and acquisitions in 2017, and in 2018, a lot of thoughts swirled around “what’s next?” We believe the big will continue to get bigger - but this will leave gaps for small and nimble players to focus in on their niches.

“The consolidation we’ve seen will continue. But consumers are also crying out for unique and highly customized travel experiences, and that means smaller, more entrepreneurial, highly specialized, and agile players will emerge.”-Simon Turner, former president of global development at Starwood

And then there is AirBnB, with their ‘will they, won’t they’ IPO, as well as their push into the lucrative luxury market. What makes them such an interesting competitor is their ability to display the agility of a smaller player, but with a war chest equivalent to any in the industry.

To combat these threats, while creating personalized experiences for your customers, you need to also build agile ethos and processes into your organization.

The fight for direct relationships with millennials increases

Having officially overtaken the baby boomers, millennials are a cornerstone to industry growth as they continue to seek experiences over physical goods. Many global hotel chains have pivoted to begin building connections with this growing segment – and this is expected to intensify.

The Internet of Things (IoT)

Marriott has its “Internet of Things room” in development - complete with interactive mirrors and personalized digital photo frames to personalize visits and guest services. Thousands of its rooms at Wynn Las Vegas are already voice-activated via Amazon Echo.

IoT is showing no signs of slowing down. The convergence of digital and physical worlds will become even further apparent as your competitors use their healthy margins to make significant investments in digital.

And while it can be tempting to float on the rising tide amongst all this rapid growth, now is not the time to put your feet up.

With new developments in technology and a changing customer base, the ability to adapt and grow with the market is absolutely critical. It’s critical that you work with partners that not only support but champion a growth and innovation mentality, ensuring that when the tide finally falls, you’re not the one left with shrinking returns.

Customer loyalty: Let’s have a data-driven conversation

Are loyalty programs a waste of time - and money?

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Customer loyalty: Let’s have a data-driven conversation

The drive to become data-driven pervades so many conversations we have with travel and hospitality clients today. Marriott International is a great example – here’s what their head of Global Digital & Sales had to say about leveraging data to earn customer loyalty: 

“Marriott’s vision is to be the world’s favorite travel company. The best way to reach that goal is to employ a best-in-breed, global customer recognition platform that connects our guests at every possible touchpoint to our team of expert hospitality professionals who strive to delight our guests every stay.” 

Here’s the sobering reality every travel & hospitality company should pay attention to: Globally, companies lose more than $300 billion yearly due to poor customer experiences. What’s worse is that two-thirds of that are snatched up by competitors of the losing brands – meaning if you’re not providing the experiences your customers demand, you’re effectively handing them over on a platter to the enemy. 

Re-engineering your first customer touchpoints 

While it’s true that we have increasingly gained enormous access to customer data – which should theoretically mean that now more than ever we have the tools to provide a killer customer experience (CX) – 80% of data is “dark and untouched”. This means it’s never actually used to make improvements to the customer experience – and often goes to waste. 

Imagine transforming your contact centers from monolithic, transaction-based “warehouses” to CX centers of excellence. With a strong quality assurance team and integrated technology in place, you will get regular feedback on which script approaches do and don’t work for your different customer segments.  

Your agents, coached in the myriad of questions they might encounter (“Can my dog stay in the hotel?”), should be ready. Answering this question might require probing to determine the size of the dog. 

Alternatively, when an agent has rich customer profile information, a question that’s likely to ramp up the loyalty quotient with a customer who has previously traveled with her dog would be, “Will Daisy be staying with you on this visit?” 

To compete today, your customer contact centers can no longer simply be transactional and reactive; they must be proactive, data-driven hubs where service issues are identified, solutions are tested, and customer delight and loyalty are accessible objectives.

Three hospitality trends to inform your 2019

Are loyalty programs a waste of time - and money?

Speak to a CX Expert Today

Contact Mark

Are loyalty programs a waste of time – and money?

Three hospitality trends to inform your 2019

Customer loyalty: Let’s have a data-driven conversation

Speak to a CX Expert Today

Contact Mark