Data Analytics: Creating More Value, Variety, and Visibility for the Travel Industry

Aug. 15, 2023
Data Analytics: Creating More Value, Variety, and Visibility for the Travel Industry

The travel industry is one of the most dynamic and complex sectors in the world, with multiple stakeholders, such as travelers, travel agencies, vendors, and partners, involved in creating and delivering travel products and services. The travel industry also faces many challenges and opportunities, such as understanding and then adapting to customer behavior, responding to unpredictable global events, and embracing evolving technology without introducing risk.

For leaders in upper management, this all adds up to complex, fateful decision-making. These business-driving choices should be based on non-stop data that is recorded, stored, and turned into insight. The technologies emerging today designed to slice and dice this data into meaningful and practical business tactics are staggering.

Too often, though, it’s either soloed or ignored — a lost opportunity.  The untapped potential is enormous; leveraging it would be nothing less than transformative to most travel agency firms.

Big Data, Big Results

It all begins with data analytics: the process of collecting, organizing, analyzing, and interpreting large amounts of data to generate those insights and make informed decisions. Data analytics in the travel industry can help agencies understand the needs and expectations of travelers, optimize the performance and profitability of travel businesses, and create innovative and personalized travel experiences. In this blog post, we will focus on how data analytics is shaping the travel industry, specifically from the perspective of travel agencies.

Benefits Abound


If we think back to our introduction, a complex matrix of participants, products, and business processes make up our source of Big Data. Depending on how well you can integrate it all, the opportunities for business analytics in the travel industry are endless. Not all of the options below are relevant (or easily managed) by every type of agency, but choosing a few to invest in and focus on will drive up your bottom line.


As you read, keep this important fact in mind: Some of these can be created and managed in-house, some completely outsourced, and many often take the form of a third-party solution brought in-house to be customized and managed by your team.

  • Travel arrangements: Data analytics can help travel agencies plan and book trips based on customer data (such as preferences, budget, and availability), market data (such as prices, options, and deals), and transaction data (such as bookings, cancellations, changes, and payments). For example, data analytics can help travel agencies customize itineraries by using recommendation systems that suggest the best destinations, activities, and attractions for each customer. Not only does this help accelerate the process and remove the “misfire factor” of a recommendation that doesn’t pan out, but it also delights customers who feel as if you have read their minds — when all you’ve been doing is deploying technology to pay attention to every detail.
  • Affordable travels: Data analytics can help travel agencies identify affordable itinerary plans based on budget data (such as customer spending limits and travel costs). Data analytics can also help travel agencies to leverage discount data (such as promotions, loyalty programs, and partnerships) and operational data (such as inventory, distribution, and operations) to reduce costs. In particular, data analytics can help travel agencies optimize inventory by using demand forecasting that predicts the future demand for different travel products and services. This helps your firm to, say, reserve the right blocks of travel reservations, way in advance, for your clients.
  • Advice on weather conditions: The most carefully-planned ski vacation is a dud if the weather’s too warm, and the most adventurous hiking trip can cross the failure threshold if the rain doesn’t stop.  Data analytics can help travel agencies provide advice on weather conditions based on weather data — real-time and historical weather data from various sources and locations. Travel agencies can even leverage sentiment analysis that analyzes customer feedback on social media and other channels to understand how weather affects their travel experience.
  • Hotel reservations and car rentals: Data analytics can help travel agencies to make hotel reservations and car rentals based on hotel data (such as preferences, ratings, reviews, and availability) and car rental data (such as preferences, ratings, reviews, and availability). Data analytics can also help travel agencies to negotiate rates and terms with hotels and car rental companies as price comparisons compare the prices and options of different hotels and cars from various sources. Clients are doing this themselves, manually, online, so offering them an automated analysis is a valuable offering to lock in loyalty.
  • Proper travel documentation: This one is truly a value-add differentiator. Travel data analytics can help ensure clients have proper travel documentation based on travel regulation data (such as visa requirements, passport validity, health certificates, insurance policies, and other documents for different destinations). For example, text mining can extract relevant information changes or updates in travel regulations from unstructured text sources such as websites, blogs, news articles, etc.
  • Customer satisfaction: Data analytics can help travel agencies measure and improve customer satisfaction based on feedback data (such as surveys, reviews, ratings, social media, and other channels). Data analytics can also help travel agencies to analyze customer behavior, preferences, expectations, and satisfaction levels. Identify customer segments, target markets, loyal customers, and potential customers.
  • Marketing strategies: Data analytics can help travel agencies design and implement effective marketing strategies based on market data (such as market trends, customer demands, competitor actions, and industry opportunities). Data analytics can also help travel agencies to create personalized offers, promotions, campaigns, and content for their customers. Every sector experiencing its digital transformation has discovered that personalization is the long-sought-after key to tailoring marketing messages and content to each customer’s interests and preferences.
  • Business intelligence: While many of the fascinating options above can be considered optional, this aspect of data analytics should take priority as a core tool for focusing on the hard-core numbers driving performance data (such as revenue, profit margin, conversion rate, customer retention rate, etc.). With dashboards that visualize the key performance indicators in a user-friendly interface, BI helps travel agencies empirically identify strengths, weaknesses, opportunities, and threats in their business environment, to make the data-driven decisions to improve their business outcomes.

Why isn’t everyone doing it?

If all this is true, why aren’t all agencies relying heavily on working through all this data? There are four completely valid reasons, as frustrating as that may be. (Spoiler – we’ll end with a way to get the job done and avoid these obstacles.):

  • Cost: Creating your own data analytics solution traditionally requires investment in hardware, software, data storage, data integration, data quality, data security, and data governance. Some travel agencies may not have the budget or resources to afford these costs or may not see the ROI in the short term. Indeed, seeing is believing, and many do see the results … once the competition is already offering it.
  • Complexity: Data analytics involves dealing with large volumes, variety, velocity, and veracity of data from multiple sources and formats. Some travel agencies may not have the in-house skills, expertise, or tools to handle this complexity or face challenges in aligning their data with their business goals and strategies.
  • Culture: Data analytics requires a culture of data-driven decision-making, where data is valued, trusted, and shared across the organization. Some travel agencies may have a culture of “gut feeling,” tradition/experience, or personnel hierarchy, where data is ignored, doubted, or hoarded by different functions and units. This is common in almost all business sectors, and often increases with the size of the company and layers of management.
  • Compliance: Data analytics requires compliance with various laws and regulations regarding data privacy, security, and ethics. Some travel agencies may not be aware of these laws and regulations or have the policies and procedures to comply with them. Others may simply be nervous about taking on the responsibility, especially with corporate travel data.

We promised you a solution: you don’t need to build it yourself or rely on generic reports and studies.

Deploy a travel-oriented data platform designed, configured, and supported by experts focusing on this one core task: collecting data (merging yours with external sources) and turning it into easily understood, empirical evidence to guide business leaders. Business Intelligence dashboards hide the complexity from those who do not need granular details but want to leverage clear trends, understand triggers of successes and failures, and plan their next move based on real-time information. This isn’t a task for an all-purpose ERP/BI package, but rather for a bespoke platform designed to provide this one benefit through a toolkit that’s incredibly complex on the back end, but quick and user-friendly on your screen.


In a competitive, dynamic business with delicate profit margins per transaction, travel agencies need everything at their disposal to stay a step ahead. Data Analytics represents a broad list of applications and benefits, simultaneously serving two purposes: The agency improves its services, increases its profitability, and enhances its competitiveness, while its customers are delighted with more engaging, personalized, and memorable travel experiences.

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