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Episode 11

Strategies for Travel Marketing

About This Episode

February 7, 2024

Exploring travel marketing in 2024, looking at programmatic ads, personalization, trends, success metrics, privacy, and more.

Yehia Elkhouly | Director, Solutions in Advertising Technologies, StackAdapt

Munem Nasif | Senior Analyst, Solutions in Advertising Technologies, StackAdapt

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Transcript

Episode Introduction (00:00:00)

Being able to take those different types of components, let’s say the first-party data coming from a brand different measurement solutions that we have been able to dissect those audiences and understand different profile components, understand their journey through the specific decisions that they make along the funnel, and then tie that back to the campaign and provide those insights back to brands. This will help improve their digital marketing campaigns or programmatic campaigns give them an overall better understanding of who their travellers are, ultimately help them build a more successful business.

How Agencies Thrive Introduction (00:00:28)

But then you think about the social landscape, the research and data is hugely significant when we combine all of these different touch points. So that longtime loyalty and then diving into the clicks to leads to sales, gotten to a point where it can drive better results in audience targeting and really is what’s going to set you apart. You’re tuning in, you’re tuning in, you’re tuning in to the How Agencies Thrive podcast.

Sneha (00:00:54)

I read something interesting on Statista. The largest travel and tourism market is the hotels market, with a projected market volume of 446.5 billion US dollars this year, in 2024, and 76% of total revenue will be generated through online sales by 2028. Hello, and welcome to the How Agencies Thrive Podcast. I’m Sneha Suhas from StackAdapt. And with me, I have travel marketing experts Yehia and Munem from StackAdapt. Today, we’re here to talk about all things travel marketing, right from how programmatic advertising can specifically benefit the travel industry, personalized marketing experiences for travelers, we’re going to cover everything you need to know about travel marketing. But let’s start with a round of introductions. Before we jump into this topic, Munem, I’m going to pass it to you please tell us about your area of expertise. And your experience so far.

Munem (00:01:50)

Yeah, for sure I can get started. So, hey, I’m Munem and I’m currently Senior Analyst within the solutions team at StackAdapt. So our team essentially works on building ad tech solutions across multiple different verticals and industries. But along with Yehia, one of the core verticals we’re focusing on is travel, which is why we’re here to speak today. I have been part of StackAdapt for two years now, and have been working on travel for a majority of that time. So I’ve spent a lot of time working with clients and partners within the space. Throughout this time, we’ve worked with multiple brands that spanned from destination marketing organizations, to airlines, to hotels, events, attractions, and all the other sub-industries that fall under the umbrella of the overall travel and tourism vertical, which has really made me appreciate essentially, like the nuances that come with this industry’s advertising requirements. So I’m really excited to provide as much insight as possible today. And yeah, just a bit of like a background is I’m essentially a new grad, but I have a lot of my background within accounting. So that was a major career shift for me to kind of focus in on marketing. I feel like you know, building strategy, and overall solutions is something that I’m really passionate about. So just getting to do that for a vertical. That is as large as travel. I think it’s something that I’ve been super passionate about. So yeah, looking forward to speaking more on this today.

Sneha (00:03:13)

Amazing. Great to have you here. Thank you for joining us. I’ll pass it to you Yehia for your introduction.

Yehia (00:03:19)

Yeah, thank you Sneha. So I work with Munem. In the solutions team, I am Senior Manager. And I’ve been with StackAdapt for two years and a half. Alongside Munem, our main focus is to be in the middle between the revenue team and our engineering and solutions team. Our role is to try to understand how the industry’s needs change, and evolve. Alongside the latest trends in the industry. We try to bring the latest and most innovative ideas within the travel vertical and other verticals to our clients. And we work with other teams within StackAdapt to build those solutions and make them accessible. We also work with our revenue teams and with our clients to help them understand how to use those solutions. And to actually drive leverage them to maximize their ROI on their marketing dollars. Then before StackAdapt I used to be more on the brand side of things. So I worked in a large CPG company before I also started my own company. So I was always a consumer of ad tech, which gave me a good perspective into the needs of marketers and the needs of organizations. Also being an entrepreneur, I think the concept of being resourceful and efficient in terms of how to maximize that ROI was paramount. We didn’t have a lot of money to spend. So we’re very cautious on really making the best out of the marketing dollars that we invest and also really understanding the customer journey and understanding the specific points that we need to kind of reach them at to achieve our objectives as an organization. And luckily, at StackAdapt, I’ve had the opportunity to be in the build mode. So with that perspective, and with the knowledge I accumulated from everyone in the company, it gave me an opportunity to actually bring that understanding to the table, and to try to think about things from that perspective.

Sneha (00:05:24)

Amazing. Great to have you here. And thank you so much for joining us. I just wanted to start with the question of programmatic advertising, specifically benefiting the travel industry considering its unique challenges and consumer behaviour. How do you think programmatic specifically benefits the travel industry?

Yehia (00:05:45)

Yeah, I think that’s a great question. And before I answer that question, I think it’s important to understand what does the travel industry mean? And what is the typical journey of a traveller because like I mentioned, at the beginning, it’s important to understand that journey, so we can actually influence travellers through our campaigns and achieve our objectives. So the way we look at travel, a lot of sub-travel verticals, including destination marketing organizations, hotels, like you mentioned, is a huge player in that in that vertical, you have airlines, you have cruises. And we have other sub verticals, the typical travel journey, as we understand it will have the three final stages, usually awareness, consideration and conversion. So for travel, the first stage is called the research phase, or the dream phase, the traveller would actually go out there and try to consume a lot of information about different destinations and different options for the travel. At the end of that stage, they will make a decision on where they want to travel. And then there’s the planning phase for travellers. So now that they know, they want to, let’s say travel to a certain destination, there’s a lot of planning that goes in place, or which airline would I take which accommodation? Where would I stay? What activities would I do? What attractions would I visit? And at the end of this phase, there’s some sort of a plan where, okay, I want to travel, those dates. Those are my airline options, those are my accommodation options. At the last stage of that funnel, there is the actual booking, so travellers would typically book airlines, and then hotels, and then the activities, usually in that order, but not necessarily. And ultimately, there is visitation at the end of this process. So if we link this back to programmatic, programmatic has the advantage of being able to reach travellers in different stages of that funnel, and also to measure the impact of the campaigns at each stage of that funnel. So if you think about the breadth and the comprehensiveness of programmatic, we are able to identify the signal that shows intent for travellers, and then target them across different channels. And understand which stage exactly of the funnel they’re at which then with the right creative and reach them with the right ad, and ultimately measure the impact of, of our campaigns and feed this back into our planning for the campaigns and actually extract insights and optimize on performance.

Sneha (00:08:37)

And how does digital advertising enable personalized marketing experiences for travellers? And what do you think are some of the key data points that drive these campaigns?

Munem (00:08:49)

Yeah, so I think your targeting strategy especially is key in terms of delivering a personalized marketing experience for travellers as Yeha was mentioning regarding the travel funnel itself. I’d say in that regard, contextual targeting is probably the most widely used tactic for this. And I would say it is quite effective for any upper funnel ads that a travel brand is running. The reason why contextual targeting is so powerful is because you’re able to reach a user about a specific destination, for example, as they’re reading about it on the web. So the user is more likely to move down the funnel at this stage because they’re consuming the content around the respective destination at real time at the moment that the ad is served. So that really goes a long way in terms of personalizing marketing experiences for travellers, but I wouldn’t say the tactics actually end there, however, there are definitely other types of data sources that can be leveraged to deliver a more personalized experience for travellers. So I think a good example of this would be travel intent data, for example. There are certain data sources that exist within the ad-tech industry that are directly sourced from OTAs, booking sites, travel blogs, etc. That kind of captures data on users that are browsing on their sites or apps, and see what they’re searching for. So they later make this data available for digital advertisers and marketers to essentially target a guest. So if you want to reach a traveller, who, let’s say might be in market to visit Toronto this summer, these travel sites and apps will actually capture the users who specifically went to their website and searched it up, which essentially is an indication that they’re in the market to visit Toronto this summer. So targeting these users will ensure that your ad is served to users who were interested in visiting that destination, therefore, making it a pretty highly personalized experience. Other targeting tactics also exist. So for example, transaction data has been pretty big as of late within the travel industry. So if there are specific merchants that you want to target and the user was purchasing from, you could do that. So let’s say you want to target someone who specifically bought like an airline ticket from this, like a specific brand of airlines, that is something you could do, or you can kind of target based on their behaviour. So if your brand wants to, you know, market a specific loyalty program that is specifically catered to frequent travellers, then we can also target by users that frequently have travelled over the past year. So I think that is why it is so cool, that digital advertising exists for marketers in this space, because you could be reaching users essentially anywhere over the world based on their actions, and gives you the ability to create creatives that speak to a specific type of audience, rather than having just a generic and broad creative, that won’t really resonate with money.

Sneha (00:11:39)

amazing. And, you know, lots of things are changing when it comes to the landscape of digital marketing. So how does the marketer ensure that they’re staying on top of all these trends while also maintaining relevance and effectiveness in travel advertising?

Yehia (00:11:56)

Yeah, I really like that question. And then I think, at the very high level, for the travel industry, and for the digital advertising space, in general, it’s always changing. Changes can be at the level of macroeconomics. And it can be in the nuances of how a traveller make their decisions as they go along this journey. So I think the key to that is to identify the relevance of that trend or that change, to the objectives that we’re trying to achieve. And for that to happen, I think, requires understanding of three things, understanding of the changes that are happening on the standing of the objectives that we’re trying to achieve, and a strong understanding of the industry and how it works in general. So I’ll give you an example. I think, everyone now speaking about AI, in terms of its uses for marketing, everyone wants to kind of throw in AI into all the efforts and all the products that we want to work on. And I think part of that is understanding to what extent is AI relevant, let’s say to a travel marketer, because there’s always the human component. And it’s always our ability to come up with a creative way to address the needs. As far as this example is concerned, I would say understanding the model itself and how it works, specifically for AI is a key to that, we have a strong understanding on let’s say, how a hotel strives to optimize for the return on their investment and the bookings that are achieved through the marketing campaign, we understand the components that go into that decision making for a traveller, let’s say, the origin market of a traveller the destination that a child is looking to travel to the profile of the traveller itself, the typical spend of a traveller, using those different components, we can train an AI model to actually generate certain types of audiences based on those prompts, and then use this to target the audiences that are interested to travel to certain destination, and will be a good fit for that hotel. So I think in summary, it’s just being able to understand the relevance of the trend and apply it to, to our own use cases and the needs of our travel marketers.

Munem (00:14:29)

Yeah. And I also wanted to add to that, I think, at least in the context of our team, specifically, we get a lot of chances to speak to travel brands and clients and agencies. They also do a great job at kind of letting us know what’s on the horizon or what’s like emerging within the travel industry. That always also gives us a good idea in terms of like, what to look out for, like what type of let’s say advertising strategies that are really starting to emerge within the industry, and we can use that as kind of like the foundation for what our team does next in terms of creating exciting features that cater to travel marketers.

Sneha (00:15:06)

Amazing. And if we have to talk about personalized travel marketing, what strategies would you employ to strike a balance between automated programmatic campaigns and also adding a human element which is required for personalized travel marketing? How would you go about that?

Yehia (00:15:23)

I will go about that by applying the framework of using the human element. So I think human element is really effective in in coming up with a creative plan for the campaign. So for example, if we are trying to target a certain type of audience, who is interested in, let’s say, dining, as an example, for a destination that has a reputation of a very good dining scene. And let’s say we don’t have a way to actually reach this type of audience, our approach is to implement creative ways to identify this type of audience and, reach out to them or reach them programmatically. For example, using our digital out-of-home capabilities to target people who are in certain proximity of locations that, we know, for example, have a dining space, and then we target them when they show an intent to travel. So in other words, I think, it’s on one side, understanding the requirements and coming up with a creative way to address those certain requirements for our travellers, and then using our tools to actually personalize and automate the personalization for travellers. So one example is our dynamic creative optimization, which works in a way that we have some sort of a decision tree. And our human element in that is identifying the decision-making logic in the decision-making progress. And then identifying specifically what elements of a creative would be personalized. When those triggers or decision-making points are met, based on a certain data pipeline. And based on that decision to you, we’re able to continuously optimize our creatives, and by extension, our campaigns to the specific audience that we’re trying to reach and to the specific call to actions that we’re trying to kind of deliver on that on that messages on our creatives. I would say that, in my opinion, is the balance between the human element and the automation.

Sneha (00:17:45)

Question to the both of you, how do you determine return on investment in this context? And what are some of the metrics that you’d like to point out and say that these are the crucial ones when it comes to evaluating the success of a travel marketing campaign?

Munem (00:18:01)

Yeah, so that’s a great question. And I think that’s something that will always come up anytime a travel marketer is in the process of determining their marketing strategy is how we determine success, right? So you can obviously rely on the usual metrics, which are, you know, typical for digital advertising. So you know, click-through rates, clicks, conversions. But to truly understand the success of your advertising campaigns, in the context of travel, I say that there’s much more that you can do. And there are specific tools that exist within adtech that allow travel marketers to measure this. So I’m just gonna kind of break it down into three core buckets that we typically see on how we can measure success. The first one being is changing sentiment and sentimentality or affinity towards specific brand. So sometimes the travel brand will just want consumers to view their destination, hotel, airline more positively through their ads. And marketers will then usually use Brand Lift studies where this essentially helps them address this question where users who were exposed to the ad will be served with the survey after and the response in the survey will be compared against the answers of those who are not exposed to their ads. And this would essentially be able to determine a lift percentage, a positive lift percentage here would essentially mean that your campaign was a success, because all those users that were exposed to your ads are now viewing your brand more positively. Right? I’d say one of the other core ways that travellers tried to measure success is simply through just the amount of let’s say the flight or hotel bookings that your campaigns drove. So there are also specific tools in the space that allow you to do that as well. So let’s say if you want to see the specific dollar amount of revenue that your digital campaigns are driving in terms of, you know, flight or hotel bookings. This is a very crude for the marketing tool for destination marketing organizations, so GMOs, and these tools will allow you to kind of provide, essentially connect like the dots between anyone who has been exposed to your ad. And then being able to see if they later on went and made some sort of like a hotel booking or a flight purchase. Additionally, they also get insight into, you know, the number of searches or the origin markets of the travellers, demographic attributes. But the core essential feature here is that you do get a revenue amount. And that is an easy way for travel marketers to kind of, you know, derive a row as value from their digital marketing efforts. And I’d say the final one that is very important, especially for destinations is essentially just destination visitation and destination spend attribution. This is very lower stage of the marketing funnel, as Yehia mentioned earlier, ultimately, the goal of any destination at the end of the day is to kind of drive users to visit their destination. But how do these marketing organizations actually understand how effective their digital marketing was in driving those visits? Well, there are many tools that currently exist that, you know, allow you to do this. So part one is just measuring, you know, the overall visitation and there are so many foot traffic measurement partners that exist within the space nowadays, that it is very easy to understand, you know, who was exposed to your programmatic ad, and then who actually ended up being at your destination. This allows you to kind of connect the dots and understand you know, just how effective your marketing ads were. But I’d say part two of measuring success here is, and this might be the most important is just understanding how much travellers are spending at like the merchants’ stores within your destination. And with the, you know, measurement tools that are powered by transaction data, there is an ability to connect identifiers of those who saw a digital ad, and then understand how much revenue that they’re driving within your destination. So this, you can also get an idea of, you know, the demographics of those that are, you know, ending up at your destination where they’re coming from, as well as which category of merchants they shop at the most. And most importantly, you get the total number of revenue that’s generated. So using these tools kind of really essentially helps any marketers get a comprehensive insight into the ROI and the digital marketing campaigns. I’d say to essentially summarize my point, I’m saying that ad tech is at a really good place right now, I’d say in terms of measurement tools and solutions that can be used to get an accurate idea of ROIs. And these solutions cater specifically to travel vertical. So it always makes sense for any travel marketer to kind of incorporate these into their overall marketing strategy to know exactly what is working and what the messages are, you know, most well resonating with like their users. And of course, you know, these tools aren’t perfect, because you will never have 100% coverage or insight into every user that is exposed to your ad, simply because of you know, identifiers, limitations with, you know, cookies being deprecated. But just even like having a 50% sample size, or insight into the market is essentially a really good starting point for any marketer search marketer to kind of get a good understanding of what’s truly succeeding with their campaigns.

Sneha (00:23:25)

Yeah, thanks. So you spoke about cookie deprecation and personal data. So considering the privacy of these things, the sensitivity of personal data, how do you prioritize customer consumer privacy, while still leveraging data for targeted advertising and travel marketing? How do you draw the line?

Munem (00:23:44)

Yeah, that’s a really good question. I think this is a really hot topic right now in the ad tech industry. And there’s certainly a lot of steps that have been taken, and continue to be taken to ensure consumer privacy is essentially protected at every step of the way, when targeting users in a campaign. You know, in the context of StackAdapt, specifically, we will only record user data and the user has given us consent to stack it up for using their data. If the user has opted out of any personalized advertising, we will not bid on their request. Or we do not, you know, record their identifier into our user database. So therefore, we will never record the user data on someone who does not want to see an ad that is served to StackAdapt. But just speaking outside of StackAdapt. And you know, just throughout like the overall industry, I’d say any of the top players or ad tech companies out there, they’re very compliant in this space and will essentially never collect PII information, unless it is consented and even for targeting purposes like ads will usually be targeted against hashed IDs of users. Hashed IDs ensure that no matter who appears within the bid stream there is no way to decrypt that hashed ID and tie it back to a specific person. So this is essentially a very impenetrable methodology that ensures that a consumer’s privacy is protected at all times, I’d say even for the measurement solutions that I was just speaking about all the insights and you know, attribute and revenue that is presented to the marketers, they’re all aggregated. So no specific user identity is being exposed at any point in time. So I’d say altogether, that this aspect of the industry is always evolving. And I think we can only expect the strength of consumer privacy to only become stronger as time goes on. Because we just see, like the industry, kind of going down this path where there will be more scrutiny on protecting consumers and their privacy. So all the companies within the space will try to do as best of a job as possible to make sure they’re compliant in all aspects.

Sneha (00:25:57)

Perfect, yeah. And the final question, it’s the crystal ball question in PharmD, predictions, requests. So how do you foresee the evolution of advertising within the travel industry? Especially considering emerging technologies and changing consumer behaviours? Especially post-pandemic?

Yehia (00:26:17)

That’s a great question. And I like that it’s the last question because it kind of summarizes a lot of things that we talked about today. So I think the first part of the question is how did the consumer behavior change post-pandemic, especially for travel. So we hear a lot the term of revenge travel, a lot of people couldn’t travel for a long period of time. So there’s a massive increase, just organic increase in the demand for travel across all the sub-verticals that we mentioned. So that’s one component, I think the other component is because pandemic actually shifted consumer behaviour more digitally across the board. This also impacted travel. So the journey, which import was first in person and import was, digital has shifted a lot towards the digital and more digital journey. And that means that this journey became more complex, more complex for us to understand more complex for us can reach those travellers. So I think that’s one part of the change. And then the other part of the change is more related to the future of our industry. I think, the biggest theme, I think Munem touched on it, is privacy, changes in regulations, and also the idea of cookie deprecation. So I think this shift in the industry will naturally mean, more weight is placed on the usability of first-party data. And that’s where technology is headed. So a travel brand can have multiple sources for first-party data. So you have the CRM data, site activity, app activity, data coming from CDPs. Loyalty programs, so different types of sources for first-party data, I think, where the industry is headed, is the ability to ingest this first-party data, to be able to match it to programmatic identifiers, and then do all sorts of things with this first-party data, obviously, the ability to activate this data programmatically and target users within that pool of data, enrichment, which is a huge component. So I think this one speaks more to the complexity of the journey and the complexity of traveler profiles. So how do we understand this data? How do we decipher this data into multiple components? And then how do we identify the specific components that we’ll use to enrich this data to actually target users with similar attributes at scale? I think also part of it is performance optimization and personalization. So again, stemming from the ability to ingest this first-party data, and then understand what’s within that data, and then tie that back to campaign performance, and use those insights to further optimize campaigns, further personalize our campaigns to improve the KPIs that we’re measuring. I think that’s a huge change that will happen in the industry, becoming more focused around the data coming from travel band. And I think another component is going to be attribution. Where right now attribution there’s different models of attribution. I think Munem touched upon the KPIs for certain types of travel subcategories, like airlines and hotels, extremely important to understand how the attribution model works. I think the ability to drive first-party data, let’s say first-party booking data to campaigns and then doing more accurate attribution, it’s only going to help brands improve the ROI on their investment. And I think finally, just from an analytics and insights perspective, being able to take those different types of components, let’s say that first-party data coming from a brand, let’s say through CRM, or campaign logs, people were able to reach for different measurement solutions that we have, and being able to dissect those audiences and understand different profile components understand their journey through the specific decisions that they make along the funnel, and then tie that back to the campaign and provide those insights back to brands. This will help them not only improve their digital marketing campaigns or programmatic campaigns, it’ll give them an overall better understanding of who their clientele is, who their travellers are, and ultimately help them build a more successful business. So I think to summarize my part, I think the change is positive. I think there’s definitely a growing opportunity within travel. The fact that the journey is becoming more digital, it’s actually in the advantage of digital marketers. It gives us an opportunity to actually improve the effectiveness and the ROI of the campaigns that we run, they ask the element of complexity, and this complexity is going to be amplified a little bit with cookie deprecation, and with the changes in privacy. So the technology is headed more towards, in my opinion, improving the usability and the matching, the activation of this first-party data and then using it for all intents and purposes to help marketers, number one, target number two, measure, and number three, analyze and extract insights to further optimize their campaigns and businesses in general.

Sneha (00:32:02)

Amazing. That brings us to the end of this episode, Munem and Yehia, thank you so much for joining us. This was really insightful. Great to have you here. And thanks to you, the one listening to this, whoever you are, marketer, brand agency, I’m sure you had a lot to take away. Again, thanks so much for joining us. Great to have the both of you here. And to you, the one who stuck around till the very end, make sure you subscribe to the podcast or listen to the new episodes right when they drop. If you like the podcast, share it with your teammates, it could be a cool resource to post on your work chat as a recommendation. So go ahead and do that. And if you want to get in touch, write to us at academy@stackadapt.com That is academy@stackadapt.com. We have episodes releasing every alternate Wednesdays. So stay tuned. Until then, this has been the How Agencies Thrive podcast. See you in the next episode.

Episode Outro (00:33:00)

Thank you so much for tuning in. This has been the How Agencies Thrive podcast. If you like what you heard, then there’s three things that you can do to support the show. Number one, subscribe. Number two, leave us a review. And number three, share our podcasts on social media or with anyone who might find value in this content. If you have questions or feedback or just want to learn how agencies and brands work with StackAdapt, you can us at StackAapt.com. Thanks for listening, and we’ll see you next time.

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