Privacy is a major concern for the majority of people when it comes to technology these days, and businesses are responding by giving users more control over their data. While consumers view recent changes favorably, marketers are understandably concerned. This is because these changes are on track to fundamentally alter the foundations of virtually all digital marketing. While email marketing has a future, hoteliers must be aware of current trends in order to adjust their strategies appropriately. Indeed, hotels that plan ahead can get a leg up on the competition and use this as an opportunity to reconnect with the essence of hospitality — developing meaningful relationships with their guests.
What’s happening
Apple is a pioneer in granting users greater control over how their data is shared. The company’s upcoming iOS 15, iPadOS 15, and macOS Monterey updates include a Mail Privacy Protection feature that masks the user’s IP address and prevents marketers from tracking whether and when their emails are opened. Apple is also planning to introduce a new feature called Hide My Email, which will allow users to create proxy email addresses rather than sharing their primary email address. These proxy addresses forward messages to the user’s primary inbox and are completely customizable. The effect is similar to that of Gmail’s Promotions tab, which collects emails that the algorithm classifies as marketing messages.
These changes reflect the stance taken by all of the technology giants, including Facebook, Google, and Microsoft, to safeguard their users’ privacy. Apple recently introduced an option for users to disable its Identifier for Advertisers (IDFA), which enables advertisers to target and track users across iOS devices. Safari and Firefox, two of the most widely used web browsers on the planet, already block third-party cookies, and Google intends to follow suit.
Why it’s important
These changes are critical because digital marketing is heavily reliant on user behavior. Until now, email marketing relied on invisible pixels and other covert methods to collect data from recipients, allowing marketers to personalize their messaging and track users’ interactions with their emails. Not only will businesses have less information about their prospective customers — such as device, location, and demographic information — but they will also be unable to track whether or not their emails are opened.
These changes will have a significant impact on how marketers track and measure success. Rather than focusing on the number of emails opened, marketers must now prioritize click-through rate — the percentage of users who click the email’s link(s). To accomplish this, they’ll need to abandon the “batch and blast” strategy in favor of ensuring that the content of each email is compelling enough to earn a click.
What comes next
While consumers have increased their desire for control over their data, they have also grown accustomed to personalized online experiences, posing a challenge for digital marketers. Marketers must now develop new methods for learning about their prospective customers and providing them with relevant, personalized content. Rather than performing this function behind the scenes, businesses will need to rely on data obtained directly (and voluntarily) from users — in other words, first-party data.
The term “first-party data” refers to information provided knowingly by users. Polls, sweepstakes, newsletter sign-ups, and interactive social posts are all ways for hoteliers to collect extremely valuable data directly from their guests. With third-party data and many traditional email metrics being phased out permanently, this first-party data will be critical to the success of marketing campaigns.
To maximize the amount of data collected, hoteliers must prioritize two critical factors: trust and value. Users are more willing to share information with brands if they believe the information will not be shared with other companies. Additionally, they will share their information only if they stand to gain something in exchange. Along with using this data to provide relevant content to guests, hotels can offer value-added services such as coupons, vouchers, and discounts to encourage online interaction.
Along with data collection, hoteliers must improve their reporting. They will need to examine their marketing metrics more broadly and not just rely on email data (specifically open rate). There is much more to engagement than email opens, and if hoteliers can get more specific with their reporting on clicks, UTM parameters, and other channels of engagement, they will eventually gain a better understanding of how guests interact with their brand.
Tools for hoteliers
Hotels will now be entirely reliant on data they can collect on their own, which means that the technology they use to manage and make sense of this data will be critical. How effectively a hotel manages its data will determine the success of its marketing efforts — and, ultimately, the hotel itself.
Data management begins with a strong CDP (Customer Data Platform), such as Cendyn’s Starling. Starling consolidates, cleanses, and enriches data as it enters a hotelier’s website — via the booking engine, newsletter sign-up, and online surveys, for example — providing a single source of truth. Not only will the hotel be able to use the high-quality data to power guest communications, services, and personalized marketing, but they will also have a detailed account of how the data was obtained, ensuring compliance with global privacy regulations.
Once a hotel has high-quality data, it must still utilize it effectively. That is where a CRM (Customer Relationship Management) platform, such as Cendyn’s eInsightTM CRM, comes into play. The platform compiles all of the hotel’s data into 360-degree profiles of past, present, and future guests. This enables hotels to determine the RFM (Recency, Frequency, and Monetary) value of their guests, segment audiences for marketing campaigns, and target guests with personalized messaging.
Conclusion
Email marketing will remain a highly effective method of generating business for hotels, but the learning curve will be steep. As privacy and control over data become more prevalent, first-party data is gaining prominence. Hoteliers who successfully adapt their systems and strategies will prosper; while those who do not will see their marketing efforts suffer a significant decline in effectiveness. Hotels can ensure their success by maximizing the amount of first-party data collected and managing it properly. If anything, this shift refocuses hoteliers on the fundamental principle of hospitality — developing trust and quality relationships with guests.