Social media has had a huge impact on hospitality over the last few years. Across all sub-industries and functional areas, managers are struggling to understand and leverage this emerging area. I have been very encouraged over the last year in particular by the degree to which the hospitality industry has embraced the value of social media beyond just “monitor and respond”. We’ve begun to take social media from a “buzz word” to a viable source of data about operations and consumers, and an opportunity to engage with our customers in a much more meaningful way. As many of you who follow this column know, I’m quite passionate about social media analytics, and I firmly believe there is still a huge amount of opportunity in this area, assuming you think about it like an Analytic Hospitality Executive.
Beyond the engagement mechanism, the biggest advantage of all that user generated content in social media channels is that social data is public data – which means you can access and analyze not only your hotels information, but that of your competitors as well. This “apples to apples” comparison with competitors is an unprecedented opportunity – but it also exponentially increases the amount of data and the complexity of the analysis you need to perform.
It’s also become very clear that social media data has value beyond the marketing department and beyond customer engagement strategies. The insight from user generated content can inform operational initiatives, guide new product or service development, assist in competitive positioning and, as I’ll talk about next week, influence pricing strategies. Adding to the amount of data and the complexity of the analysis, is the challenge of providing access to the right data in the right format to any user that could benefit anywhere in the organization.
Social media (and user generated content in general) is a classic example of “big data” as we’ve defined it previously in this blog series. Volume (thousands of reviews, ratings, posts, etc.), variety (unstructured text, quantitative ratings, photos, likes, videos, audio, multiple languages, myriads of sources) and velocity of data, that typically exceeds an organization’s ability to store and process to derive insights in a timely fashion. This represents the largest challenge that must be overcome for hospitality to fully take advantage of the opportunities afforded by social media data and channels. Storing, analyzing and reporting on this data requires rethinking “traditional” analytics techniques and data infrastructure.
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The text analytics infrastructure must be able to support multiple languages natively (less than half of all social activity is in English!) and must be robust enough to deliver results across the organization. Further, the data and analytics can’t be limited to a sub-set of channels or to a pre-built taxonomy that restricts analysis options if it is to be useful to multiple departments with multiple and diverse business problems.
I’ve seen hospitality companies using social media channels to raise visibility in natural search (reducing pay-per-click costs and increasing conversions), justifying investment in new products or services by “voice of the consumer” analysis in social channels, developing training programs from trends in complaints through social channels, and augmenting consumer profiles with preferences (and value calculations) derived through social media activity. These run the gamut from marketing to development to operations activities, and all align with initiatives that were ongoing within the company.
It can be very daunting to approach this problem, given the “newness” and the complexity. To ensure success, as with any other analytic initiative, start small, but start with a visible project, backed by an executive sponsor that has power within the organization. I would recommend that hospitality executives think through the following questions (in this order) when trying to decide how to incorporate social data and channels in their business strategy:
- 1. What business problem am I trying to solve?
- 2. What social data can contribute to this solution?
- 3. Who will need to access this information, and at what level of detail?
Approaching social media as simply another source of data that can enhance analyses the company is already doing to support their business strategy can not only help executives get their arms around what it all means and how it can add value, but it also makes it much easier to justify the investment in the people, processes and technology necessary to fully take advantage of social data and channels. To maintain a long term competitive advantage, firms need to think broadly and holistically about social media and user generated content as part of their overall data and analytics strategy.
Next week, I’ll present the results of some of my research into the influence of reviews, ratings and price in consumers’ evaluation of a hotel purchase. The purpose of this research is to help hotel revenue managers understand where user generated content fits in pricing and distribution strategies, and what they need to be looking for to maintain a profitable pricing strategy. Stay tuned!
