How to make the most of your customer base in 2021

Author: Daniel Batey, Managing Director, Union Data

As we look to the future and what tourism in Scotland will look like once restrictions are eased, it is more important than ever to understand who your customers are so that when the time is right, you can communicate with them effectively and efficiently.

Most tourism organisations, like other sectors of the economy, have an audience made up of different types of people with different reasons for visiting or becoming a customer. They will also have different reasons for choosing your particular organisation over a competitor.  Being customer focussed and using customer insight to understand these reasons will help you to determine better routes out of the current crisis to a sustainable, profitable future.

SEGMENTATION

One of the best ways to understand these differences, and to be able to make better decisions based on them, is to segment your customer base into smaller parts. At a very high level, a segmentation model for a consumer-facing tourism organisation could identify and separate out three core groups.

With much less international travel on the cards for the foreseeable future, the opportunity from visitors in the first group is limited. This suggests that most tourism organisations are going to need to focus on the latter two groups until such time as we move out of the current crisis as both of them offer immediate opportunities once travel restrictions ease. Infrequent visitors living in, or near, Scotland are likely to have much less choice in destination, so building engagement with them is strongly recommended. Equally, reminding regular visitors that you are still accepting forward bookings is also especially important at this time. For both of these groups, the ‘book early to avoid disappointment’ message has never felt more relevant.

CUSTOMER INSIGHT

Knowing what proportion of your business came from each of these groups before the crisis can help you understand the likely impact on your business in 2021 and beyond. With this insight, you can pivot your focus towards the most important audience and prioritise your marketing accordingly.

For some organisations, it is not too hard to make a guess – high-end hotels in Edinburgh or on Skye, for example, will have a much higher proportion in the first category than a hotel in a less famous location. So, the impact on those high-end hotels may be far greater, and last for a longer time, than for those hotels with a much higher proportion of regular visitors.

In effect, organisations with a high proportion of income from loyal, regular visitors will have a much better chance of survival, and will rebound quicker than those without. The importance of having a core base of loyal customers is not new, but it is especially important at this incredibly difficult time.

CUSTOMER COMMUNICATIONS

So how do we grow this loyal, regular base? Delivering fantastic service and a great customer experience are, of course, the foundation for driving loyalty. It must be remembered that this great experience is unique both to your organisation and to your audience – the expectations for a budget traveller to a remote part of Scotland are completely different than the expectations of that same budget traveller to the heart of Glasgow, for example. Furthermore, that experience does not stop when they leave your premises – it continues through your subsequent marketing communications. Adjusting your communications to make them more relevant to your audience is a key component to increasing loyalty.

So what works? Starting with a ‘thank you’ is a great, and often overlooked, first step. One travel organisation we worked with received 80% re-bookings from one audience segment after introducing a ‘thank you’ email, compared to just 25% without. This is also a good time to remind them of their previous visit, and to encourage them to return by reminding them of the service they enjoyed previously. Also, don’t be afraid to ask – customer satisfaction and other surveys can help you learn both what you are doing well and what needs to improve, while loyalty is built through customers feeling looked-after. After all, we all like our opinion to be heard, and we are much more likely to look favourably on an organisation that welcomes feedback than one we’re ignored by.

To conclude: analysing and segmenting your customer base will help you to understand your organisation better, to improve forecasts for 2021 and beyond (which will keep the bank onside), to improve customer experience by improving messaging and, ultimately, to building a more sustainable, profitable future for your organisation.

If you’re interested in finding out more about how you can get started on segmenting your customer base to help you bounce back in 2021, we’ve created a simple guide to help you. This is available to all STA members, all you have to do is email us at hello@uniondata.co.uk to request a copy.

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