One new technology which has grown exponentially in recent years is cloud computing. It’s not that long ago that the cloud seemed like a remote and obtuse concept, but today more and more businesses are choosing to run at least some of their operations within the cloud.
The rise of Big Data
This has directly led to another phenomenon which is commonly discussed in every sector of business, that of Big Data. The vast storage and processing capacity of the cloud, coupled with the huge range of information created by the contemporary Internet, and consequently the growth in data produced has been absolutely rapid.
The CEO of Google, Eric Schmidt, asserted a few years ago that human-beings now create more data in two days than in the entirety of human history up until 2003! But this process will only accelerate in the coming years. The American multinational hardware storage provider EMC estimates that the level of data created annually will increase by 1,000 percent over the next six years, from 4.4 zettabytes (4.4 trillion Gigabytes) in 2013 to 44 zettabytes by 2020.
Big Data is a fascinating concept not merely because of the sheer scale of the information involved, but also because it promises a quantum leap in human understanding. The topic has been discussed at every level of society, even publicly by the infamous US linguistics academic Professor Noam Chomsky. The ability to collect, collate and analyse almost incalculable amounts of information enabled by Big Data offers huge opportunities to businesses as well. And the travel industry is no exception to this rule.
Naturally, as with any emerging technology, it takes some time for human-beings to adapt to its rise. Therefore the potential of the data hasn't even come close to being tapped into yet. According to EMC, in 2013 approximately 5 percent of all Big Data created was actually analysed. This is rather akin to the old statistic about human-beings only using a certain portion of our brains. Clearly there is a great deal of expansion possible in this arena.
nSight and data mining
One company attempting to make a difference in the travel sphere with regard to Big Data is nSight. This is a company which specialises in data mining and analysis for the travel industry, aggregating data from more than 80 million consumer ‘looks and books’ on a daily basis. This information is gleaned from a network of 5,000 3rd-party travel sites, and to put the amount of data involved into perspective, nSight will analyse over 29 billion ‘looks and books’ in a calendar year. When you get to these sorts of numbers, it starts to become possible to draw some extremely interesting and accurate conclusions.
The founder of nSight, Rich Maradik, has stated with regard to his company that understanding how consumers shop and book across a variety of different online channels is a fundamental key to maximising profit and ensuring that quiet periods are kept to a bare minimum.
nSight doesn't merely collect and assess data, it also systematically breaks it down into a series of analytical categories. One of the most important parts of this process is building a Rate Efficiency Index. This invaluable source of information benchmarks and compares the impact of the rates charged by travel businesses on the amount of searches, and ultimately bookings that they attract. nSight proclaims that this is the only way that revenue manages and digital marketers can explicitly conserve the effect that the best available rate has on how consumers behave and whether they automatically book a certain product.
In addition, nSight also offers an interactive dashboard which deals with forward-looking demand. This enables hotels to see research and booking performances on travel days that are up to ninety days in the future. nSight provides a huge amount of data on this gleaned from customer analysis, and subscribers to the website of the company can gain access to it, which can be highly useful in understanding the profile of customers most likely to book with a particular hotel. Furthermore, this information can be broken down to 30, 60 and 90 day periods.
Another form of insight provided by nSight is its patented nCompass BI Reporting. This is another analysis report that effectively looks into the future, and which provides a simple colour-coded calendar view of demand and bookings for the next 30 day and 60 day periods, and where to target active consumers online. By using nCompass, a hotel can identify where it needs to go to fill gaps in demand by identifying geographic and demographic markets which are likely to book over 30 and 60 day periods. It effectively provides a roadmap for digital marketing over an 18 month period for all hotels, all over the world.
Predicting the future with Big Data
In a previous Digital Tourism Think Tank article, we reported on the ability of nSight to predict European travel destinations over an entire season. Once upon a time, this sort of functionality would have been considered science fiction. But with the emergence of Big Data, and the tools now in existence to analyse it, predicting the future and profiling the potential customer base of a hotel just became feasible.
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