Tracking Tourism: The Tourism Research Blog Archive for the ‘Business research’ Category

I spoke recently to Ian Yeoman, formerly Scenario Planning for Visit Scotland. As Ian is in the process of taking up a position at Victoria University, New Zealand, and has recently published Tomorrow’s Tourist, it seemed a good time to catch him to get his views on where industry is heading.

Anyone who has seen Ian speak will know that he does not speak from an ivory-tower but rather in a very accessible way on what could be a dense topic. And the book is little different – it’s aimed at business and planners within the travel and tourism sector definitely not a scholarly tome designed to gather dust.

Although Ian mentioned that Scenario Planning was a little like science fiction, I don’t think we should interpret this as meaning that what he does is a flight of fantasy. On the contrary, his work is backed up by a lot of empirical research and this one of the reasons why it is worth paying attention to him.

It’s important to note that at the outset that Ian’s work concentrates on the changing nature of the traveller. While this obviously has implication for how the supply side of the industry meets that demand, his work is not about the development of the supply side per se. Instead he looks the changing picture of demands, desires, constraints and impacts that the traveller and thereby the travel industry may face.

Ian’s work offers predictions through to 2030 but this interview concentrated more on the short term issues that we could be facing. For those of you wanting to find out what happens next, you’ll just have to buy the book.

So what is changing for the traveller and what are the implications?

While it is tricky to condense the whole conversation down into a couple of lines, I’ll start by trying to do just that.

• We are moving from a world of seemingly unlimited opportunity through to a world of constraints. These drivers are largely external leading to constraints that are economic, environmental, political and moral in nature.
• The growth of tourism will not stop – although it might be slower than it has been.
• The traveller will want more in less time or with less effort – this has implications for everything from the format of events through to booking processes and the nature of breaks.

Before this becomes a shopping list of changes, lets take those points and develop them more fully.

We are entering a world of constraints

It will have escape no-one’s notice that the economy is not as robust as it once was. And, although there is still resistance in some quarters about the degree to which climate change is attributable to human activity, governments are acting to lessen its impact whatever the cause. On the home front, we notice that our disposable income doesn’t goes as far as it did, say, 18 months ago. We notice that the cost of travel is rising, both at the immediate level of our cars and at a wider level.

When Ian described this as “leaving a world of low inflation – moving to an era of constraints”, it suggests that this is not just a short term blip on a historically inevitable rate of progress but rather a longer lasting change of pace.

“The consumer is being squeezed by rising prices and falling levels of disposal incomes, as a consequence out of home expenditure will fall. In the short term, rural Scotland will feel the pinch rather than Glasgow/ Edinburgh / Aberdeen. Leisure spending will fall but business tourism in cities will remain robust in the short term. The middle classes are the market that is going to be effected the most.”

We have been in situations like this before though, most notably in the oil shocks of the 1970s. In the case of the 1974 oil shocks, the economy rebounded swiftly but the problems of the79-83 took a lot longer to recover from.

It should be noted that the constraints are not just economic but political as well as governments make move to combat climate changes and other examples of environmental degradation.

On a positive note, Ian noted that we are more fuel efficient today than in the 1970s – our cars do more miles/kilometers to the gallon/litre for example. In the medium term, he sees coal and nuclear as the only realistic players in the energy market but acknowledges that the political and environmental issues surrounding this are immense and are constraints in themselves.

However, although ‘grid’ power could be delivered through coal/nuclear energy generation, the fact still remains that the vast majority of transport in the UK is oil based which will have an impact on people’s willingness to travel longer distances by car in a time of rising prices.

Some other examples of constraining factors include:

• Environmental constraints: Some destinations start to become too hot to visit on account of climate change – the eastern and southern Mediterranean countries particularly will be challenged under this scenario. In other areas, decisions will be made to limit the number of visitors on account of their impact on a sensitive region (I suspect that Antarctica cruises might be see this)
• Moral constraints: Ostentatious luxury will be frowned upon in some travel sectors – Ian noted that there was a trend for businesses to meet in ‘misery locations’ that sent a clear message that money was being spent on doing business, not having fun.
• Cost constraints: Airlines will protect revenue by reduce capacity. Effectively, this would mean that we could go back to 1990s style prices for some of the less profitable routes.

The growth of tourism will not stop – but it might slow down

Ian discussed two scenarios - one in which demand is not constrained and one in which it is. His estimate was that under the scenario where there is no limiting factor on growth, then we could be looking at around a 3.4% rise per year leading to 1.9 international arrivals by 2030. However, in world of constraints, that growth rate would slow to 1.2-1.5% per annum, resulting in 0.8 billion fewer arrivals by the same data.

How the constraining factors affect visitors

But how will the present situation affect the travel industry? Well, I’ll detail a few of Ian’s predictions below but I think they can be summarised as, ”travellers will want more from what they can get.” This shouldn’t be immediately interpreted to mean (for example) that travellers will want 2 meals for the price of 1 as standard but rather they will want to seek travel options that enable them to do more in the time they have available to them and this has implications for the process, products, promotional and logistical aspects of the delivery of travel.

• Proximity of destination to home will rise in importance

In a post on peak oil tourism a while ago, I speculated on whether local destinations would again become popular. Ian answer suggested that local destinations would indeed become more important but probably not in the way that many of us might imagine it. 30 years ago, ‘local’ would have suggested ‘domestic’, it now suggests ‘regional’ and regional should be understood as being within a three hour travel zone. Therefore, from a UK perspective, Paris, Athens, Tunisia etc are local.

The driver behind this shift to local is that the traveller does not want to waste their precious break (or indeed their work time) travelling. If they can only afford to take 5 days break, they do not want to spend the equivalent of 2 days travelling.

This has a number of implications including:

• A rise in city breaks (but only if they offer good transport links)
• A fall in rural breaks in remote areas
• A fall in long-haul customers.

It should be noted that city status does not guarantee that an area remains attractive to potential travellers – the important thing will be its accessibility and it’s role as just one of many competing destinations. From a Scottish perspective, the ‘local’ nature of Edinburgh and Glasgow to London will be no guarantee of their status as major tourism centres when the London customer has a choice of the whole of Europe from their local airports and international rail terminals. It should also be noted that good transport links extends not only to the nearest airport to the destination but also the connection between the terminal and the end destination.

• There will be complex customer strategies of trading up and down

Although there will be a move in time of economic challenges for people to seek cheaper and better value accommodation, the picture isn’t a simple as everyone suddenly deciding that 5 star hotels are beyond their budget. Ian noted the tendency for some people to trade up – but only if they could trade up to their first choice of hotel (for example). And if this first choice were not available, then the visitor would trade down - meaning that the choice would be between Gleneagles or the local Travelodge.

This reminded me of a paragraph from a recent edition of the Wall Street Journal, discussing Walt Disney Co’s recent performance “[Chief Executive] Mr. Iger said one factor helping the company during the downturn - as opposed to previous economic slides like the one in the early 90’s - is that 75% of our hotel product is “moderately priced”or “value priced”. In 1991, over 55% of the rooms were considered “premium priced”. Our portfolio of rooms is more accessible.

The article also notes the impact of the weakness of the dollar leading to a) an influx of visitors from overseas and b) “US residents looking to avoid the high cost of travelling abroad are visiting the domestic parks instead.”

Ian said he thought that families especially were looking to trade down at the moment and that accommodation that was ‘difficult’ to book would suffer and this point is discussed more fully in the context of the next bullet point.

I found this observation about the how people trade down interesting because it obviously applies in some markets but not others. As we discovered recently, in some markets trading up is seen as a necessity as it is a hygiene/standards factor – people simply do not trust a three star in that area to be of comparative quality and so ensure that they are getting decent hotel by booking a five star.

Ian used a couple of examples to illustrate how activities re adapt themselves to a world where people are unwilling or unable to divert as much time to that activity that previously.

You see it in sporting events. In cricket the move toward the 20Twenty format (essentially a cricket match lasting about 3 hours instead of 3-5 days) reflects how people want the experience but want to be able to have it in a condensed form to fit in with their busy lifestyles.

Ian pointed to the importance of quicker booking and check-in processes as being something that issued from the same impulse – cutting down on the ‘hard’ parts of the travelling experience to maximise the pleasurable or profitable parts.

From a Scottish perspective, Ian thought that B&Bs will lose market share to budget accommodation due to their lack of ecommerce. “Only 4% of accommodation providers in Scotland operate a dynamic on line reservation system like Easyjet. Many SME’s still only have website that effectively says, “Please make a reservation and we will contact you the next day.” In today’s society the consumer won’t wait.”

Many SME’s still only have website that effectively says, “Please make a reservation and we will contact you the next day.” In today’s society the consumer won’t wait.

He also cited the City of York’s outside gallery as an example of allowing visitors access to culture ‘on the hoof.’

So who’s getting it right?

There will continue to be destinations that are approaching these challenges in the right way. Ian cited the following as examples of the right approach:

• Scotland: Scotland has invested in research and understanding its customers to an extent unrivalled by most other areas (and my own experience suggests that this is the case also).
• Vienna: Vienna (and Austria as a whole) also collects great visitor data and Vienna has a really strong emphasis on delivering quality to the MICE market.
• Las Vegas: Vegas is a hedonism hotspot and well positioned to exploit gambling opportunities coming from Asia

Additionally, some niche markets will continue to do well but other broader markets will struggle. This shouldn’t be understood as meaning just destinations but also visitor segments – for example, single people travelling in a group.

Ian’s message for operators and providers is simple. “Overall, this means that business needs to know the price elasticity of consumers - using a process of segmentation - some consumers will continue to pay a premium.” In other words, you need to know your customers inside out and really ‘up your game’ when it comes to customer intelligence as there will be people out there who will pay for good value. Obviously a lot of big players do this already but, from a personal perspective, I fear that there is a lot of the market who view the notion of understanding and identifying the tolerances and desires of distinct customer types as something akin to a science beyond their grasp and not worth attempting.

There will also be parts of the world that continue to be profitable. We suggested Canada would be a beneficiary of the fuel rise in a post a while ago and Ian added Aberdeen to this list on account of its status as the home of North Sea Oil.

So, what does this mean?

I think the thing that history tells us is that, although circumstances can look similar and indeed share similar traits, no period will be exactly like a previous period. So we will not be going forward to the past to 1974 or 1979 and here are a number of reason off the top of my head why this will be the case:

• Tourism and Travel have grown since the 1970s and so we live in under a completely different set of circumstances than those experienced at that time. Put simply, we are standing in a different place and that is not one characterized by 1970s travel levels and expectations.
• Technology plays a more integrated and personal role in the process of travel and tourism than it did in the 1970s and we can expect this to remain the case – the internet will not be ‘un-invented’ any more than commercial television was ‘un-invented’ in previous times of economic scarcity.
• The demographics are different – we are about to experience the mass retirement of the baby-boomer generation for example.
• Markets are more free now than in the 1970s

So the constraint of ‘only’ going to Milan for a break instead of a break to Vancouver will be the equivalent of someone in the 1950s only going to Blackpool instead of going to Paris

It is clear that some providers will need to fight harder for their customers. My take on it is that knowing your customer and the whole market in which you operate will be key to navigating these waters. Reading a book like Ian’s or blog like this are part of that process but understanding the customer and their trends needs to be ingrained within the tourism industry even at the smallest level. To navigate these water blind would be to immediately operate at a competitive disadvantage.

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I would just like to finish the post by thanking Ian for his time with this post and to wish him the best in his new position in New Zealand. I suspect, though, that we haven’t heard the last of him!

When in doubt decisions get made based on our own gut instincts.  Or on those instincts of the loudest or most influential people in the room. Somehow, the voice of the customer doesn’t always get the hearing it deserves.

Website interfaces, marketing messages, service propositions - all things that impact the customer absolutely - typically get created from the inside out.  With rumbling guts leading the way.  But you, me, the boss, the consultant - we are not the customer.  The perspective that the customer brings - whether gathered through research in advance, testing during the process or feedback after the event - takes some of the randomness and risk out of second guessing.

How do you ensure the customer doesn’t get left out?

1. Don’t optimize for the hippo

Everyone has a hippo in their life - it may be the HIghest Paid Person’s Opinion, or a Highly Influential Person’s Personal Opinion.  The hippo knows just how a website should look, or just what makes a great advert and they are not about to keep that opinion to themselves.

In lieu of stronger evidence from the customer, the hippo holds great sway!

But, our roaring, mud loving, opinionated hippo friends are not the people the website, marketing campaign, or interior layouts are ultimately designed for - theirs isn’t the only significant opinion.

Which brings me to the second point.

2. If in doubt, ask… (the customer that is!)

Just how many hours of speculation, doubt and opining could be saved by talking to the customer?

User testing, for example, can stop dead a circular debate that has run through a company for months.  In the space of just a few hours the customers themselves reveal what is really in their mind.

Testing different content side by side and tracking the comparative results (right through to overall revenue) is another way of asking the customer “which of these works best for you”.  Tools such as Google’s free weboptimizer allow you to easily test any combination of web content to find out what leads to the most conversions.  The customer speaks with their attention and actions.

And of course, asking the customer can also mean good old research in the form of focus groups, site visits, follow homes, surveys, customer diaries, user testing and formal or informal interviews.

3. But, don’t start research sure of the answer - you’ll only prove your self right

Keep your mind open, listen and learn.  Biased research is no better than gut instinct.  I’ve written before about how easy it is to influence the results of your research.  For example by unwittingly encouraging people to tell you what you want to hear, or by being so sure of “the answer” that you hear it despite what your customers tell you.

Instead, see if you can prove yourself wrong.

4. Test, analyse and make decisions based on evidence

If you have the evidence, act on it - don’t let the customer in, then ignore what they tell you when it comes to decision making.

But sometimes, despite the fact that you’ve talked to the customer and gathered your facts, the hippo can come back for a final roar - still convinced that their personal opinion trumps the evidence.

Keep the hippo at bay with voice of the customer data (the customer in their own words really works here). And remind them of the financial costs of inaction or inappropriate action.  Better still, help the hippo realise it was all their idea in the first place and that they are one smart semi-aquatic mammal!

5. Out of sight, out of mind?

Highly successful businesses typically know that the customer is genuinely at the centre of their universe. And many go to great lengths to keep the customer presence there in the decision making process.  I saw a presentation by eBay recently, where they talked  about how people throughout the organisation participate in follow homes, to observe customers using the site in their own context.

Microsoft have done a lot of persona work and have created life size representations of key customer personas who are taken along to meetings. At the other end of the scale I have seen tourism businesses whose offices are full of cards and notes from previous visitors from all over the world - also a visual representation, if they choose to use it, of the customers’ role in key decisions.

So, you are not the customer and neither is the hippo - make sure you don’t simply second guess what your real highly influential opinion holders think!

I’ve presented two eMarketing workshops in as many days this week (do feel free to peruse the slides here) and a head spinning seven in the last four weeks.

In those sessions I have talked about Web 2.0, blogging, web measurement, Travel 2.0 (click for a definition), engaging in the conversation with your customer and that fact that there has been a monumental shift in how potential consumers seek, evaluate and trust information.

But from San Francisco to the Scottish Highlands, London to Swansea - as businesses absorb the implications of what this means, they generally express with some horror the exact same question. “Just how long does all this stuff take?”

And of course, it’s an absolutely killer question, right at the heart of how successfully Travel 2.0 techniques are adopted by businesses. “Just how do I blog, Flickr, Twitter, Facebook, YouTube, Tripadvisor etc etc and still run my business…. How do I commit enough time to make this work, but not so much time that every other aspect of my business stops?”

Like any other marketing or business function, you should invest time according to how important the results are likely to be to your business. The Travel 2.0 space is a perfect one in which to experiment and keep experimenting as you maximise results. Yes it is time consuming, but that isn’t reason enough to not get involved. The internet is now absolutely critical to travel - it is mainstream, not niche as these statistics show:

In terms of specific advice, I can only answer from my personal experience:

1) Narrow down the options:

Start with research (this post tells you how). You can’t be everywhere, nor do you need to be. Are there certain sites, communities, blogs or Flickr groups etc where your business, sector, interests or competitiors are already being actively discussed. Are there places where the key thinkers/players in your field are already meeting. Are there places you simply like to be?

You do not have to do this completely manually, as the above post shows, there are free technologies that will bring this information to you.

2) Understand your target market online:

Don’t assume that Travel 2.0 is only about young, trendy advance adopters of technology. Participation in social networking, for example, mirrors the age spread of the online population as a whole. Tripadvisor and to some extent Flickr are becoming a mainstream part of the travel selection process.

However, different sites, tools and communities do attract different profiles of people. Just as its worth paying attention to whether other people in your field are spending their time online, its also worth thinking carefully about where your potential customers are too. Hitwise, comScore and Alexa are provide some free information that help answer this.

3) Know why you’re there:

Are you there in order to create awareness of your business, demonstrate your expertise, deliver better customer service, spot opportunities and threats, learn from your peers, network, spy on the competition?

Understand the point of why you’re investing your time and just how important that is to the business. If you are driving new business and delivering better customer service, you may even be able to see quite quickly that this is so important an activity and delivery such results that you should shift resources (say a marketing assistant) away from off-line activity and into the Travel 2.0 space.

I am increasing coming across young marketing assistants for whom blogging, being active in MySpace, Facebook, Twitter, Flickr etc is a large part of their job. (Travel, public sector and charities are sectors where I have seen examples of this).

4) Assign a cash value to your time:

Engaging with the Travel 2.0 consumer is far higher in time costs than actual marketing spend. Whereas it easy to understand that a marketing campaign that cost £10,000 and drove £1,000 of business was not successful, you can’t make that correlation for time spent on MySpace until you understand the cost of what you invested.

I know, for example, how much running this blog costs me as a cash equivalent to my time - I also know that it represents a worthwhile use of my time (because I join up the dots and where possible track where new opportunities originated from).

5) Review regularly what is and isn’t working:

Web 2.0. Travel 2.0, social media - call it what you will, remains incredibly faddy at an individual site/community level. Facebook saw its first dip in traffic earlier this year and us travel bloggers, who move from community to community in pursuit of the best place to really interact with each other, are examples of how fickle visitors to individual communities can be.

There is no single best place to spend your energies - it should and probably will be a least a few sites/activities at any one time. But finding the optimum combination for you will be an ongoing experiment and will change regularly. Review frequently (using web analytics, research or good old fashioned talking to your customers and peers) and adapt!

This is my strategy and it perhaps sounds excessively calculated. In fact, I enjoy investing my time and energy in the communities I participate in. I find it personally rewarding as well as good for business and I have made many friends and travelled to wonderful places (for real, not just virtually).

The reason I need a strategy to manage my Web 2.0 efforts is simply because the opportunities are endless whereas time and energy are not.

Calling those juggling champions

I know for a fact that there are a number of people out there who successfully juggle running travel and tourism businesses with maintaining blogs, leading great industry discussions online, while answering the needs of their own and a broader swathe of potential customers in a range of communities. Guido, the Happy Hotelier is one, Rene at Greater Speyside another, so is Claude Bernard and Don at Get a Room.

There are more of you than I can mention and most of the blogs I link to on the right of this page provide examples of fantastic time and Travel 2.0 gymnastics.

Perhaps you will share with us how you do it?

5 tips to stop drowning in information and start finding those insights you can act on

Apologies for the delay in the latest update to this blog. I went straight from San Francisco eMetrics Summit, to London eMetrics, giving a WAA web analytics workshop en route and launching an online eMarketing course in the same week. As a result, I’ve returned to the kind of information overload many of you are familiar with and the question behind this post feels pretty relevant to me just now!

Nugget image by my_amii on Fickr

So, how is it that you can get past collecting ever bigger mountains of information and get to the point that you draw significant and actionable nuggets from the information?

1. Spend more time understanding the data than collecting it

This first tip is easier said than done, but is critical to getting past data and towards decisions. Collecting data isn’t enough and it doesn’t analyse itself (even if you have great software, it still doesn’t interpret itself). In order to have a chance of drawing meaningful actions from all the information you have, time and human brain power needs to be committed to working with the data.

Insight from data analysis typically comes from looking at things that have changed over time in the information and drilling down to find out why. It also comes from looking at segments or sub groups within the data. It is rare that you’ll get insight from your information without really diving in deep - a cursory glance doesn’t tell you what is going on below the surface.

Finally, when working with the data, you can’t assume your first theories are right. Insight often comes when you pose a question of the information and the data disproves your theory completely! But you can’t get to this point until more time is spent on understanding information than collecting it.

2. Hunt the nugget

Thanks to the customer insight team at the New York Times for opening my eyes to the power of the nugget! Nuggets are those tasty morsels of information that leave you pleasantly fulfilled, without giving you indigestion. When it comes to analysis and reporting of your business information, it is better to have 5 tasty nuggets than 100 irrelevant facts.

How do you spot your nuggets? Well, for a start they always pass the “So what?” test. They’re relevant, actionable and digestible. We don’t want wobbly jelly nuggets, that can’t cope with being prodded, we want good firm nuggets that stand up to scrutiny.

The fact that customers whose package includes car hire are twice as likely to repeat book and recommend a friend compared to other customers is a great nugget. Sure, it opens other questions (why? what are we doing right? how do we capitalise on this?) but its going to drive action and potential revenue in the process.

3. Think context and ability to act

Nuggets and insights flow most readily when data is viewed through context coloured spectacles. Context is typically threefold:

1) The customer, their behaviour, needs and intents
2) The market, competitors and external factors beyond the control of the business
3) The business, its sphere of influence, challenges, immediate and long term objectives

With these things constantly in mind, you can ask the right questions of the information you have, so that the answers you find are relevant, rather than simply interesting. By also factoring in the organisation’s ability to act on what you find, you start to shape some prioritisation into your analysis.

4. Join up teams and data sources to break down information silos

Whether you have a substantial team of researchers, web analysts and business intelligence people, or have no people whatsoever and a whole mountain of information in shoe boxes - insight comes from joined up thinking.

At London eMetrics last week, I saw examples of more firms that are moving their all their research and analysis people into “customer insight” teams, rather than isolated units - a move which has to help create a joined up view of business information.

But even if you are doing all this your self, a joined up approach can simply mean picking the right data for the job, but in manageable portions. (Successfully tackling a small question, is better than trying to address everything at once and failing). You won’t understand why a visitor did something by looking at your web analytics data, nor will you understand precisely what they did by asking them. The big, valuable picture comes when you pool your data sources and apply appropriate, context rich questions.

5. More tools are not the answer

Whether you’re using Google Analytics or Omniture, SPSS or Excel, ComScore or Hitwise - you’re using a tool to help you get towards the answers in your information. The tool, however marvellous or expensive, is not the answer in itself. (If you don’t believe me, try drilling a hole in the wall without actually plugging the drill in and using it). The answer only comes when you apply point one and spend more time on trying to understand the data, than in simply collecting it.

You’ll get more nuggets and actionable insights from a basic tool like Excel used well, than you will ever get from a top of the range tool like Omniture if it is barely used at all.

So, when your information isn’t producing anything you can work with, don’t be tempted to go buy another piece of software to try and conjure up an instant answer - it won’t happen. Instead invest some time (buy it in if you don’t have the expertise) and dive a little deeper into what you already have.

To conclude - my advice is to not just collect information within your business, but to get stuck in and poke your data with a great big stick. Look for the stuff that really stands up to being prodded and you’ll find those 3 - 5 tasty nuggets of relevant insight that you can actually use to make decisions.

Some of biggest travel and tourism questions and how research can best address them

It is my humble opinion that lots of research effort and money is wasted on tackling the wrong questions. Questions that don’t stand up to the so what? test and so do not ultimately help make money, save money or improve customer experience.

I reckon there are some “big questions” at the heart of businesses and organisations in the travel and tourism sector. And while these big questions are mind-blowingly scary, because they can’t be glibly answered with a quick survey or a few days work, I think it is essential to keep them in mind for every single research and analytics activity you undertake. This is because they form the big picture - the context, the so what? - that all smaller activity must be calibrated towards.

Without reference back to the big questions, ad hoc research and analysis activity can easily lose its way or fail to be translated into any form of meaningful action. It becomes focused on the interesting or on the production of information - not on tactics and strategy.

So here’s my big three. (You may disagree and it’d be good to explore your thoughts and suggestions!)

1. How do we attract and convert customers in the face of intense global competition?

2. What must we [and all our delivery partners in the end to end process] do to ensure customers will come back/recommend to others?

3. How do we deliver a optimum customer experience from a profitable, sustainable business base?

You may have noticed I’ve covered the business, the customer, the market, but not explicitly product. Partly, this is because I see product as being closely bound up in question 1 and 3. Mostly, though, I think that in a Travel 2.0 environment, the toughest questions revolve around the customer’s experience and demand.

“The 20th century was about sorting out supply…The 21st is going to be about sorting out demand.” The Internet makes everything available, but mere availability is meaningless if the products remain unknown to potential buyers. Wired Magazine

At this point, you may be exclaiming “Enough with the deep stuff Vicky, I just want to know if my customer had a good time. I’m not trying to solve universal questions right now” To which I must irritate you further. Because as I see it, the “how was your experience” type question is asked in order to tactically address question 2 and 3. If it is being asked in isolation, all small picture and no big picture, what do you do with the answers? Benchmarking and nice graphs don’t improve customer experience or the bottom line. It’s the actions - however small - that make the difference.

So, where does research fit in to tackling these questions?

Well, given I’m feeling philosophical, I would suggest it takes a shift in mindset in order to enable these big questions to be properly tackled by research. A shift away from the idea that research is somehow something you do a bit of once in a while when you need it. A shift towards a culture of business intelligence and analytics that works with all the data it has (even if it is in a show box) in order to tackle and act on the big questions.

Allan Leighton, Chairman of the Royal Mail declared at the recent Market Research Society conference:

“I believe every organisation should have radar - to listen to your people, listen to your customers all the time. It shouldn’t be called research it should be called radar. You cannot be selective when you have it. You have to have it all the time.”

I quote it because I couldn’t agree more. And I don’t think that only global corporations and national destinations that have a hope of attaining this - I do genuinely believe that a very small business with the right mindset can also be intelligence driven.

Making radar work for you

So what does the shift from research to radar involve?

1) Always on

You can’t just do a bit of radar when you think you might need it. Radar is always on, always monitoring the information stream in anticipation of the unexpected. In research terms, that means listening to customers, staff and other data on an ongoing, not an ad-hoc basis.

2) All around

Radar takes a 360 degree view of information, it doesn’t focus on one source at the cost of all others. Switchboard activity, website activity, conversations with customers, regular staff surveys, news reports, transactional information, emails are all data sources. Listen in, by keeping on top of it and finding a standard way of recording and reporting on key information.

3) Alarms and flashing lights

Radar can only alert. Make those alerts easy to spot, as opposed to hidden deep in 100 page reports. Make the bells ring loud and the lights flash bright through the way reporting information is presented and distributed. If the boss wants a 50 word summary in a text message, that’s great. Because the point of alarms and flashing lights is for the leadership to see the problem and act.

4) Is it a bird? Is it a plane?

But is there even a problem? What is going on? Why? Often the picture isn’t really clear and your radar triggers more questions than answers. But staff on the ground know more than is often allowed for - talking to them can give insight to what is going on. You may also need to know more about what customers think and what their reasons are for this.Depending on the size of your organisation, this may be the point that you need outside expertise - or at least to make some bright internal spark available to ask great questions and crunch the answers.

5) Looks forward more often than you look back

Ait Traffic Control doesn’t use radar to see how safely planes landed yesterday, they use it to make critical, tactical decisions in the present and immediate future. The focus more on what is going on now and what might be in the way - not solely on what happened in the past.

Beware, brains in action

So, how do we get business, retain business, oh and make some money/fulfil our stated mission too?

I think these “big questions” are at the heart of businesses and organisations in the travel and tourism sector. And the point is, they can’t be answered by a quick bit of research or a new fangled tool. Instead, every piece of data/research/analysis that flows through the organisation should serve towards these critical questions.

I won’t pretend it is easy - but it is being done. And it’s being done by businesses in this sector, giving them distinct competitive advantage over those who’re wasting their time and effort tackling the wrong questions.

So, a final question to you - am I on the right track, or hopelessly deluded?

We tend to assume that other people think the same as we do. That they see things the same, even use the Internet the same.

There’s a wonderfully simple way of challenging that idea. And that is to watch (quietly!) as other people use your website. Sounds simple, doesn’t it?

I’ve spent much of the last week travelling to people’s homes and offices, observing as they use a specific website to try and achieve certain tasks. I’ve been researching what information is important to people as they explore the site, where they look for this information, the weaknesses of the site and the problems visitors have in achieving their tasks.

And even though I’ve done this kind of research many times, it still fascinates me how different people undertake the same online tasks in such different ways.

It is even more illuminating to discover how even well planned, well tended websites can still completely confound the typical visitor on a mission. You quickly discover that what is obvious to me may not be obvious to you (and vice versa).

Often I work with survey data, web analytics data and online search trends, trying to figure out what it was that the visitor was up to. But when you’re sitting in the home of a real potential customer, the realities of the problems people experience as they use a site suddenly become all to clear.

Suddenly you see how the words on your navigation tabs just don’t mean the same thing to everyone and that in-text links have this Alice in Wonderland like ability to make people click, even in the middle of a task.

Research like this is a quick sanity check that allows you a privileged glimpse of your site through the eyes of your website visitor.

You can do this yourself

So here’s a recipe for a brain tingling, eye opening research activity that will change the way you see your website forever. Just be warned - if you thought your website was perfect, you’re in for a rude awakening.

1) Identify some key aspects of your website you’d like to explore with visitors and think of some realistic tasks that relate to those aspects of the site. Think of a pretty open task (like choose a holiday that appeals to you and gather all the information you need to book it on this site).You may also want to a few very specific tasks that push people towards searching for specific facts (find out about hiring a wheelchair, or whether you can bring your dog for example). Finally, pin down a small handful of wrap-up questions you’d like to learn from people that use your site.

2) Find five people who are unfamiliar with your website. You can use five random people, however in my experience, its really worth putting the effort in to find five people that represent different segments of your web visitors. For example a trade contact, a family booker, an international customer etc. There is no point doing this with 20, 50, 100 people – five is enough for your reality check.

3) Arrange one to one sessions of up to an hour with these five people (you’ll be best to spread it over more than one day if you’re conducting the research alone). Decide whether to visit people at their home/work or in a neutral place with reliable web access and be prepared to compensate people for their time.

4) Dig out a web cam, note pad and if you have one, a voice recorder. It gets tricky trying to simultaneously listen, note what people say and check what they look at on screen, so a web cam lets you review the session afterwards (just make sure it points at the screen!)

5) Run your research session, ensuring that you do not pressure your test subjects by appearing personally invested. You’ll need to ask your participant to narrate what they’re thinking, what they’re looking for, how they’re responding to the site. That means no commenting, correcting, tutting or pointing out the obvious. If people get so lost and confused that the research is breaking down, be flexible enough to prompt them in a new direction – but the point is there is no right answer. Don’t be tempted to point out where in the site they should be looking – spend your effort trying to really see what they’re doing and hear what they’re saying.

6) Get your notes written up quickly after the session – if you’re doing five they’ll soon get confused in your mind. I like to make little pen portraits and capture information about characteristics and emotional responses, not just what they did. After all, this is qualitative research, not simply technical user testing.

7) Now the fun starts! You’ll probably have enough illumination to keep you glowing for weeks. Don’t put your notes away and think job well done – the difficult job starts here. Look at what you have discovered and start thinking of them in terms of short term quick fixes and medium to long term strategies.

Keep your five people in mind when making future decisions about your site – because you’ll know for a fact that other people don’t see things the same as you do.

Post Summary

Chris Anderson, author of The Long Tail, surmises that ‘free’ services will be a driver for business in the years to come. This post considers ways in which this could apply to the travel and hospitality market.

Chris Anderson, the man responsible for the idea of the Long Tail, has been at it again.

This month’s edition of Wired features an article called Free! Why $0.00 is the Future of Business which is about how items and services for which we are traditionally charged become free while as the potential to make money lies in ancillary services.

So, for example, you make your money not on the cost of a printer but instead the lifetime value of ink supplies. Or a newspaper becomes free on the internet as the increased audience enables it to earn enough from the increased advertising opportunities to cover the loss of income from people paying for a paper copy of the paper.

I have some issues with the articles conclusions but it is an interesting concept and one that is already being used within the travel and tourism industry.

Two examples:

1) Ryanair makes its money through food, drink, premium reservations - not just through seat sales. Michael O’Leary is on record as wanting to offer seats for free -and you just know he’s not doing this out of charity but because he knows there’s a workable business plan behind it.

2) Free Wifi Access in Hotels - it helps to differentiate one hotel from another but, presumably, could also be used to encourage cross subsidization of the service in other areas. For example, making WiFi access free could encourage guests to stay in their rooms and order more from the on-site catering.

Free Hotels?

When you come to think of it, there is little difference between a hotel room and a seat on a plane. Both are perishable commodities - once the fight takes off or the night is passed, there is no getting that unsold stock back. So, could we see the introduction at some point of the free hotel room?

Actually, I don’t see why not but I think it would need significant economies of scale to work - or a degree of monopoly provision to help things along. What I mean by ‘monopoly provision’ is this: if you are flying, you have little choice but to purchase water (for example) from the cabin crew if you have not planned ahead. You can’t pop out mid flight to get a cheaper bottle of water from the nearest newsagent or drugstore.

In other words, if there isn’t too much choice (as opposed to no choice) around, then there is a greater chance that you will be able to make money on incidentals. All airlines also have the appearance of a temporary monopoly for the duration of its flights in the form of a captive audience on the flights which means that they can sell advertising in the form of inflight magazines.

There’s no such thing as a free room.

So my thoughts are that this model might work in other areas of the tourism industry - but the trick is to identify those areas where choice is more restricted. Off the top of my head, I would suggest some remote rural locations might work under this model - there have been times when I have probably spent more on catering than accommodation in B and Bs in the North of Scotland because there simply isn’t any other alternatives.

Using my example, however, does raise the obvious question: “If I can charge £25 per person per night lodging and they spend £30 per person per night on meals, why should I make the room free and cut my income by £25 per night?” Well, the answer to that I guess is good old ‘price elasticity of demand’ - if the offer attracts enough new guests then it pays for the £25 per night loss.

Competing on Price and Quality?

So, in conclusion, I have reservations about this but I think that some brave tourism provider could well try this and if their business model is right then they will succeed. I have always been taught that to fight on price alone is a mug’s game unless you have deep pockets - however if you are able to fight on price and quality (in the form of meals, for example, that people will pay more for) then you perhaps have the makings of a winning combination.

Any thoughts?

Time to stop searching and start finding

Love ‘em or loathe ‘em, online user reviews are influential and they’re everywhere.

There’s no doubt that many tourism businesses realise the potential importance of user generated reviews. Increasingly, the evidence shows that travellers are influenced by the comments of others and most of tourism the businesses I speak to do want to manage and respond to this challenge.

But it can be an incredible struggle just to keep up with, yet alone act on, the information contained within these reviews. The sheer mass of information online means that many businesses either concentrate only on Tripadvisor, or give up on effective monitoring altogether.

For example, a survey conducted by Avalon Report showed over 90% of hoteliers think it is important to monitor reviews online, yet also found the majority of hotels monitor comments less than once every two weeks. Avalon suggest that since 87% monitor reviews manually by surfing site to site, “many of these hotel professionals appear overwhelmed by the scope of the issue, commenting they are lost in the prioritization of endless sites and searches.”

However, given the amount of effort that goes into capturing customer feedback in other aspects of the business, these freely given comments must surely have some value. Especially as unlike internally gathered comments, they are out there influencing the purchase decisions of others.

So how do tourism businesses turn online user reviews into useful research and meaningful development? I believe the answer is in tracking and monitoring online comments and reviews more effectively.

Monitoring more efficiently

There is so much potential information out there, that going site to site looking for it is simply too overwhelming. The answer is to stop surfing manually and start automating so the information comes to you.

Here are some tips how tourism businesses small and large can better grip on the online discussion that is taking place about them. Monitoring the data more effectively means you can then integrate what you find into any existing customer comment analysis process you may have. (See this previous post)

1. RSS (really simple syndication) is your friend

RSS brings your chosen web content to you through feeds as it is updated, instead of you having to visit individual sites. You can check your feedreader once a day and glance at what’s new, rather than trawl site to site, getting distracted on the way.

If you’re not already using RSS, I strongly recommend you give it a go - you’ll find you waste far less time online without missing out on the things you need to know.

Plus Tripadvisor, for example, providers feeds relating to specific properties, so you can monitor comments and respond.

Tripadvisor also produces owner feeds, which property owners can republish directly on their sites if they choose. This Travolution post explains how unedited user reviews have been welcomed by the businesses using them.

Additionally, most bloggers publish their posts as RSS feeds too (that’s what all the stuff at the top right of this blog page relates to), so you can keep an eye on key influencers in your market.

2. Set up free Google Alerts

Google alerts will email you with daily updates each time the specific terms, names and phrases of your choice are used. You can select if your alert is triggered from blogs, news, general web content etc and the frequency with which you require updating.

Personally, I find this a really handy tool and I have about 25 different alert terms running at any one time - including alerts that trigger when this blog or my name is mentioned online.

The downside is false positives, but your terms are easy to edit and amend so you can experiment to get the combination of alerts that best meet your needs.

3. Third party tools to track buzz, comments and online word of mouth

There are a number of free tools, such as the following, that let you monitor the key phases, company names or specific terms that matter to your business.

• Blogpulse’s Trend Search tracks buzz over time for certain key words, phrases or links
• Blogpulse’s Conversation Tracker assembles a snapshot of blog conversations

You can also find more tools at this Smashing Magazine post on Web 2.0 buzz monitoring.

And of course, there are also the paid tools you can also buy in to monitor and aggregate your online reviews and comments.

I’m not in a position to recommend specific paid tools as I have always found the freely available and open source tools meet my needs just fine - but I appreciate there are contexts in which paid tools fit the bill. So do feel free to tell me if you have a paid solution you couldn’t live without (no direct selling though please).

4. Build your own custom solution

For the larger business, or the somewhat technically minded, it is surprisingly easy to build yourself an in house, customer system to monitor want you want and format data how you need it.

Yahoo Pipes is an interactive feed aggregator and manipulator. Using Pipes, you can create and combine feeds to make them more powerful, useful and relevant. This Lifehacker post shows you how.

On a larger scale, if you’re running your own servers and dealing with really high volumes of online comments and conversations, I’d suggest checking out the BuzzMonitor developed by the World Bank.

As Pierre Guillaume Wielezynski of the World Bank explains:

“Like many organizations, we started listening to blogs and other forms of social media by subscribing to a blog search engine RSS feed but quickly understood it was not enough. The World Bank is a global institution and we needed to listen in multiple languages, across multiple platforms. We needed something that would aggregate all this content, help us make sense of it and allow us to collaborate around it. At the time, no solution (either commercial or open source) met those requirements so we decided to build our own.”

BuzzMonitor is an open source application that “listens in” to what people are saying across blogs and other sites in order to help the organisation understand and engage in social media. It is available as packaged, open source application. While it was developed for Linux-compatible platforms, it should be possible to install it on a Windows system, as well. (So time to call your techies!)

Moving from searching to researching

So from tracking a few terms through Google Alerts, to the monitoring the whole world from your own server - there are some great tools out there to help you automate the collection of online user generated content, comments and word of mouth.

Instead of wasting your time gathering information manually, automating the process will leave you in a position where you can start constructively responding to what you hear. That way you can get past being overwhelmed by the sheer quantity of online noise, and start reacting quickly and strategically as required.

Do you find this process overwhelming? Are you using tools I haven’t mentioned here? Do let me know!

Just like any DIY project, botched research has the potential to be a messy, costly disaster.

If you’re making the effort to do customer or market research to support your decisions, you’re committing time and money in the expectation that your business will see a positive benefit from your efforts.

The trouble is how do you know if the evidence you’re using to base your decisions on is flawed? Could your research efforts actually be creating you bigger problems? Problems that may only become apparent after you have committed considerable expenditure.

Here’s an example that one of my fellow forum members at 5000bc.com kindly shared:

Some years ago now a colleague and I surveyed local businesses on potential training courses. We got a clear cut positive response in the training and the preferred courses… But when we actually advertised the courses the response was zero.

Despite their best efforts, this business was left out of pocket when no one purchased the courses they so carefully researched.

This kind of story is really common and it’s one the reasons why you’ll often be told that research is best left to the experts. But it doesn’t work like that in the real world! People always have and always will do there own research, for obvious reasons of cost and practicality.

So here are some practical tips to help you get your DIY research right

These are five common mistakes that can turn your research efforts into a business liability:

1. You load the dice to get the answer you’re looking for

One of the problems with doing your own research is that you are so invested in it, so personally involved, that you can dramatically influence the results.

It is easy to fall into the trap of asking leading questions, meaning that your expected answer is clearly apparent to the respondent. For example “Did you enjoy our lovingly prepared food?”, “Do you think we’re right to be investing in reducing our emissions” or “Don’t you agree that towels should only be washed every two days.”

Your physical presence can also cause you to get the answer you seek. Your research respondents will mostly likely want to please you or avoid offending and given the chance will tell you precisely what you want to hear. You will reinforce this further if you find yourself nodding or verbally agreeing with their “correct” responses, or give them other clues about what you would prefer them to say.

So, when conducting your own research, try to keep your intent hidden and present a neutral, uninvested air.

2. Right questions, wrong people

The most common error I see amongst the teams of school pupils running their own businesses for Young Enterprise is that they design a product for to sell to their parents’ age group, yet they conduct their research amongst their teenage peers.

It is the same mistake as the HIPPO syndrome (making business decisions based on the Highest Paid Person’s Opinion).

You, your family, your friends and your resident HIPPO do not represent your target research population. It is very important that your research sample is representative of the market whose opinions you are seeking.

Put simply, if you want to find out how ferry users think and feel, don’t centre your research around airport users.

3. Right questions, wrong environment

How often do you change your underwear? Do you ever wear the same socks three days in a row?

If I asked you these questions in a focus group, surrounded by other people claiming to always change their socks twice a day, how likely would you be to admit the truth?

What about if I asked you the same question face to face? Personally, it’d need to be an anonymous paper or online survey, before I’d ever confess to performing the occasional sniff test on my socks.

Think carefully when conducting DIY - especially if you’re asking something personal or contentious - in case you are creating a situation where people will be too reluctant to tell you what they really think.

4. Failing to corroborate the evidence

Trusting just one source of evidence leaves you really exposed if that data is flawed. Professional researchers will typically combine several research methods to give a range of perspectives - for example, surveys, one to one interviews and focus groups combined.

Even if you’re using online data, rather than conducting direct research yourself, don’t rely on a single source of information. You’ll find dramatic different results when comparing different sources (especially if the process of repeating the information has obscured the original context and margins of error associated with the data).

And don’t forget, testing is a form of research. Putting a bunch of different offers or products on pre-sale and measuring which ones attract interest can be a useful way of corroborating your other research.

5. Good evidence, bad decisions

As this BBC article explains, the human mind is pretty irrational.

Despite good evidence, poor analysis means that bad decisions are made. There are many complex reasons for this, but here are some common ones you may have experienced:

• Deliberately or otherwise, you pick and choose from the evidence in order to “prove” your preferred theory
• Regardless of the evidence, your selective perception means you see exactly what you want to see
• The evidence we heard most recently or most emphatically take on undeserved importance
• We get blinded by averages.

The average visitor does not exist, instead averages (the mean) can hide meaningful differences in behaviour and give an overly rosy worldview. I know plenty of businesses that think their average website visitor stays for 5 mins, whereas in fact 95% of visits last for under a minute and a handful last for hours.

To conclude

So, there are pitfalls and risks to DIY research and it is harder to do it right than many people realise. But keeping these five common mistakes in mind when you are conducting your own customer, market or business research may help you avert a costly disaster.

I’m collecting DIY research disaster stories right now - I’d love to hear about any business problems you may have encountered based on using dodgy research.