The Insurance Industry of Tomorrow: InsureTech 2018 key takeaways

Tara Clemens is a Senior Research Analyst at Mintel. Tara specializes in insurance, publishing data-driven syndicated and custom reporting based in Mintel's consumer data, trends and competitive intelligence.

October 16th, 2018October 16th, 2018

The Mintel Insurance team recently embarked on a journey into the future. The third annual InsureTech Connect Conference gave sponsors and attendees a rare and holistic view into what the insurance industry of tomorrow could look like. From new product launches and lessons in behavioral economics, to innovation workshops and a Salt-N-Pepa performance, the 2018 InsureTech Connect Conference had something for everyone.

One way to sum up the conference is a recurring question that was asked during many sessions: “What does the insurance industry of the future look like?”

Insurance will be real-time

The much anticipated session with homeowners insurtech Hippo and telecom giant Comcast provided a thought provoking glimpse into the inner workings of a major partnership that took the industry by surprise. When news of Hippo and Comcast’s partnership was revealed in May 2018, thoughts ranged from, “What an opportunity for an insurance startup looking to gain traction!” to “Why did Comcast choose an insurance startup when they seemingly have the pick of the incumbent crop?”

Comcast’s Senior Director David Wechsler answered the question, “Why Hippo?” by explaining that Hippo’s vision for the future of insurance aligned with their outlook ‘to a T.’ Wechsler believes that the internet of things (IoT) products will provide the opportunity to price risk on the fly, insurance will be real-time (for example, smart tech will know exactly who is home at a certain time and adjust risk accordingly), and prevention will be at the forefront. Wechsler believes all of this will happen in the next ten years.

Insurance will be personalized

The IoT has long been opening new doors for custom and, more accurately, priced risk. State Auto Labs Director, Haley Smith said her company’s product gives consumers the ability to rerate every six months. State Auto Labs is also exploring ways to better service each individual’s claims experience by asking themselves questions like, “Could we send an Uber immediately when a crash happens? Will someone be sent to help the customer tow their car?” Smith states that the differentiator in the auto space will favor those willing to take risks in partnerships to fill these needs.

Insurance will be “API-fied”

Application programming interface (APIs) are reshaping insurance by allowing disparate systems to quickly communicate with each other in order to pass data and complete complicated tasks to help achieve results on behalf of consumers. According to a session that explored the “API-fication of Insurance,” the rise of API’s will be one of the most profound changes to take place in the insurance industry. The session also pointed out the importance of the API mindset becoming the key to distribution as products become embedded experiences.

Insurance will be easy

Kicking off the first full day of sessions, Credit Karma founder and chief executive Kenneth Lin announced the launch of its auto insurance comparison app stating, “We estimate Americans are overspending on auto insurance by nearly $21 billion a year, and believe that bringing simplicity and transparency to our members will help them save.” With the app, members will be educated through interactive experiences of auto insurance features by displaying how something like moving violations and credit scores can impact insurance rates.

It was the general consensus that carriers and insurtechs were no longer the direct threat to each other that many assume. Insurtechs provide ample opportunity for collaboration that ultimately improves every aspect of the insurance value chain. The most dynamic insurers are actively forming ecosystems to encourage insurtech and other partner engagement.

“It’s not going to be a choice,” Dan Glaser, CEO and President of Marsh & McLennan Cos. Inc. said. “The future is digital.”

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Money20/20 Day One: Globalization

Mark Miller is Associate Director of Insights for Payments with Mintel Comperemedia. He focuses on credit cards, lending products, and the general financial services landscape.

October 23rd, 2018October 23rd, 2018

Globalization – an exploration of how banks across the globe are developing and utilizing new technology to expand their reach, service their customers and improve transactions across borders was one of themes at Money20/20 on day one.

The morning kicked off with a “fireside chat” with some of APAC’s key FinTech players. Eagle Yi of WeChat Pay emphasized the multitude of tasks that its one billion users can complete within the app – reading the news, interacting with colleagues, making payments, online shopping, etc. Twenty thousand US stores now accept WeChat, providing a familiar payment option for tourists. Also expanding into US retailers is AliPay, with over 175,000 US merchants signed up, while their core focus is on Chinese users and an ambitious goal to grow their base to two billion by 2026. Their mission is to provide access globally for the underserved in developing countries and also promoting AliPay as a “financially inclusive lifestyle app.” Ant Financial (parent company of Alipay) CCO classified the company as a “TechFin” rather than a FinTech, putting it in a category of established technology companies that are expanding into financial services.

Origami Pay also has grand initiatives, including helping Japan become a cashless society. The government’s goal is to become 40% cashless by 2025, and eventually reach 80%, a bold vision for a traditionally cash-centric culture. Like its Chinese counterparts, Origami Pay uses QR codes to transact payments, and offers promotions and discounts to drive adoption. While once the de-facto standard, Arthur Zhu of China’s merchant-based LianLian Pay argued that QR codes are not a key driver, rather it was a necessity of technology needing to access a mobile wallet. Zhu predicts that QR codes will not see widespread adoption in more established financial ecosystems like the US.

The protection and privilege of identity

Other major topics revolved around digital identity, biometrics, and blockchain technology. When discussing authentication, creating a balance between security and convenience is key. When asked what was more important when conducting payment transactions, only 48% of the Money20/20 audience chose security. When the question was altered to ask about banking transactions, the figure rose to 72%. Todd Mozer, CEO of biometric firm Sensory, added that privacy needed to be added to the mix.

Allen Ganz of NEC described scenarios where users would have full control over their biometric data, choosing when and for how long to release it. Nevertheless, biometrics does seem to be the future of authentication, with Allen predicting that behavioral analysis will advance and “facial recognition will be ubiquitous.”

Shyft CEO, Bruce Silcoff, continued the identity conversation by asking, “Is blockchain the future of digital identity?” Silcoff stated that with all of the data breaches occurring daily, it is not a question of whether one’s identity has been compromised, but rather if anyone has done anything with the information. Shyft wants to use blockchain technology to reduce the amount of locations where personal data is stored while maintaining global standards, creating a “centralized, de-centralized solution.” Civic CEO, Vinny Lingham also wants to eliminate the possibility of hackers accessing large piles of PII. He claimed that “getting rid of usernames and passwords is the first step.” In their place, Civic would run in the background, providing seamless authentication through blockchain technology. “If we have to talk about blockchain to the consumer then we’ve lost.”

Ultimately, the discussion shifted from narrow usage within financial services to a more humanitarian vision of securing identification globally. Silcoff pointed out that 1.1 billion people do not have a legal ID and miss out on numerous benefits, essentially making identification a privilege rather than a right. In the end, both Silcoff and Lingham agreed that if blockchain technology catches on, the biggest winner needs to be the individual.

Artificial Intelligence: From command technology to anticipating consumer needs

Concluding the day was Sofia Altuna of Google, Ken Dodelin of Capital One, Peggy Mangot of Wells Fargo and David Sosna of Peronetics participating in a fascinating discussion of artificial intelligence (AI). Sofia spoke of the success of Google Assistant, how conversation drives consumer engagement and Google’s current focus on multilingual recognition and moving beyond voice to create a multimodal digital interaction. Dodelin focused on Capital One’s virtual assistant Eno and the need to make sure that when designing AI, machines are made to act like humans, not the other way around. In his example, instead of limiting customers to two or three responses within an automated system, Eno can recognize normal conversation and emojis. In fact, more than 60% of customers choose an emoji to confirm payments in app, as opposed to text.

Mangot took things a step further, stressing the need for AI to truly serve the needs of the customer. She argued that the tide was shifting from Personal Financial Management (PFM) tools, which simply show payments and budgeting options to a Personal Financial Coach (PFC). AI needs to deliver a personalized experience, anticipating customer needs and making recommendations in real time to assist on a path to financial health. According to Mangot, all needs can be effectively met by shifting from a product-based model to customer-centric.

What we think

Key takeaways from day one are emphasis on customer wellness and providing user-friendly platforms to meet diverse sets of customer needs, both trends that Mintel Comperemedia is following closely as we look forward to 2019. Users want a seamless banking experience but also expect more security, personalization, and nurturing from the relationship. As financial institutions shift their focus towards inclusion, wellness, and the broadening of product offerings, trust may be restored.

Stay tuned for day two highlights!

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Hotspots: October 2018’s Top Trends Observations

For the latest in consumer and industry news, top trends and market perspectives, stay tuned to Mintel News featuring commentary from Mintel's team of global category analysts.

October 24th, 2018October 24th, 2018

Hotspots brings you the Mintel Trends team’s top observations on product and service launches from around the world. From restaurants turned into co-working spaces to an author co-writing a story with her readers’ input, find out the most innovative global initiatives happening this month.

Libro Vivo – Argentina

Publishing company Planeta and Google are teaming up for a project that will see author Viviana Rivero use Google Docs to write live a spinoff of her upcoming novel. During five days, people will be able to access the Google doc and write comments about how they would like the story to continue. The project aims to reveal how the creative process of a writer works, while showing how digital and print can live together and complement each other.

Livestreaming has given consumers the chance to interact and have a say in the making of a product. Iconic Australian milk brand OAK is allowing consumers to choose its next flavour through a real-time vote on Facebook Live, while Coca-Cola Argentina has challenged an influential cook to create a dish in real time using ingredients suggested by livestream followers. In an increasingly visual world driven by fierce curiosity and fear of missing out, livestreaming seems to have a bright future as it allows people to join in without paying up.

Graciana Méndez – Trends Analyst, Latin America

Jail Review – Italy

An Italian business owner has been given a nine-month jail sentence for posting fake reviews for cash on TripAdvisor. Alongside jail time, he must pay thousands of pounds in costs and damages to Italian hospitality businesses. This is one of the first times a crime of this nature has resulted in a jail sentence.

TripAdvisor has received widespread criticism from UK pub operators for not doing more to stop users posting fake reviews. This is a step to show it is taking this issue more seriously. Information about a brand posted online is extremely important and can have huge effects on people’s behaviour and opinions. The jail sentence awarded in the TripAdvisor case should make people think twice about sharing fake information, but there is room for more tools to identify false content to protect brands and consumers.

Helen Fricker – Trends Manager, EMEA

Work Where You Eat – US

Start-up Spacious turns dinner-only restaurants into co-working spaces that can be used by members until the restaurant has to prepare for dinner. Each location has a Spacious employee that ensures workers obey the rules and have access to what they need. Equipped with pumped-up Wi-Fi, power strips and a coffee bar, Spacious locations cater to individuals rather than companies. With 15 locations in New York City, Spacious has now expanded to San Francisco, and is aiming to occupy the in-between space of a coffee shop and WeWork.

With more flexible careers, people are exploring the options for what their ‘office’ may look like. If they’re going to spend money on coffee to work in a coffee shop, why not put that money toward a monthly membership in a co-working space with free coffee? Meanwhile, restaurant owners get additional revenue and an opportunity to maximise their unused space.

Credit: Spacious.com

Alex Milinazzo, Trends Analyst, North America

Smile for Rewards – China

Coca-Cola China has launched VenCycling machines – vending machines that use facial recognition technology to identify and reward consumers who recycle. In exchange for returning used cans or plastic bottles into the machine, consumers receive credits on their mobile for beverages or products made from recycled plastics.

China had been importing plastic waste for the last 28 years, before announcing in November 2017 that it would stop taking in contaminated plastics. This is a strong indication of the government’s commitment to reduce plastic pollution. For instance, Shanghai is piloting IoT-connected recycling containers that use facial recognition technology to reward users for separating their rubbish. While this is a good start, it’s essential that both governments and businesses continue to develop the technology, create awareness and eventually evoke an intrinsic desire in consumers to reduce, reuse and recycle.

Credit: Coca-Cola

Joyce Lam – Trends Analyst, Asia Pacific

Gin Safari – UK

Tally Ho has launched a Cycling Gin Safari tour to explore London’s best gin spots on vintage bicycles. The tour starts in Lambeth in a boutique gin distillery where cyclists can learn about gin craft and artistry, and continues along industrial wharves, quiet streets and cycle lanes. Customers also get to visit food markets and try their hand at graffiti.

The success of the gin safari relies on the combination of drinking gin with cycling and learning about history and architecture. It elevates the value of a glass of gin by building an experience around it. Another attractive aspect is the revival of a past culture. There is a growing feeling of nostalgia from older generations, and a desire for vintage items from younger generations. Indeed, we have seen other categories bringing back icons, like the Sega console from the 90s, printed photo services and vinyl record players.

Julie Gable – Trends Analyst, EMEA

Plastic Road

Plastic-mixed asphalt roads are being tested in Indonesia to reduce plastic waste. 1km of road uses 2.5-5 tonnes of high-density polyethylene (HDPE) recovered from plastic bags. PT Chandra Asri Petrochemical Tbk has worked on the project in collaboration with the Ministry of Public Work and Public Housing (PUPR).

Indonesia is the second biggest contributor to plastic waste in the world, contributing around 200,000 tonnes of plastic waste a year. The government is committed to reducing plastic waste by up to 70% by 2025 and is drafting regulations to manage plastic waste at sea. In the interim, Indonesia’s two biggest Muslim organisations – Nahdlatul Ulama (NU) and Muhammadiyah – with a total of 100 million followers, said they will be preaching to their followers to reuse bags and reduce plastic waste, according to The Guardian.

Delon Wang – Manager of Trends, APAC

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Money20/20 day three: The Big Announcements

Mark Miller is Associate Director of Insights for Payments with Mintel Comperemedia. He focuses on credit cards, lending products, and the general financial services landscape.

October 25th, 2018October 25th, 2018

Day three of Money20/20 was stocked full of major announcements and new product launches!

Introducing…

In the day’s biggest announcement, Amazon and American Express unveiled the Amazon Business American Express Card. There are two rewards structures: Amazon Prime members can choose between an interest-free loan for 90 days or 5% back on purchases made at Amazon.com, Amazon Business, Amazon Web Services, and Whole Foods Market; for non-Prime members, the rewards are reduced to 60 days or 3% back. In addition, all customers will receive 2% back at restaurants, gas stations and on mobile phone services. Customers will also receive 1% back on all other purchases. At sign up, Prime members will receive a $125 Amazon gift card and non-members will get $100. Shark Tank’s Barbara Corcoran was also on stage to promote her relationship with American Express and the merits of small business ownership.

Amazon and American Express unveil the Amazon Business American Express Card.

Stash and Green Dot officially launched Stash Money, an online-only banking tool within the Stash Investment app. Stash decided to develop a no-fee banking product when their research showed their average customer was being charged over $300 annually in banking fees. With Stash user data automatically loaded, the process for onboarding is simple. While the service is not live yet, current Stash customers can reserve their spot.

HSBC is partnering with online lender Avant to offer unsecured personal loans for up to five years and $30,000. New and existing customers are eligible, with the formal launch expected in early 2019. The partnership began during an encounter at last year’s Money20/20 with Pablo Sanchez of HSBC and Al Goldstein of Avant highlighting how quickly new products can launch when traditional banks and fintechs work together.

Wealthfront launched freemium, a new product that offers free retirement planning software whether customers have a Wealthfront account or not. Customers can upload their financial information and receive spending and budgeting advice. The hope is that customers attracted to the free model will eventually sign on for the fee-based service.

WorldFirst announced the expansion of its World Account to US businesses. The service allows users to open and manage accounts in seven different currencies with no fees. The simple online platform offers free international payments and instant transactions between accounts.

Intuit, the company behind TurboTax, QuickBooks, and Mint, highlighted four new products/features:

• MintSights, which uses machine learning to understand patterns and provide recommendations to improve financial health.
• A combined household view, whereby Turbo users can view total household income, credit, and debt to potentially qualify for better loans.
• Enhancements to pre-qualification.
• Partnerships with Lending Club and Wealthfront that will allow pre-population of loan applications for a faster overall origination process.

In a similar move, Credit Karma launched its new Marketplace to help consumers make solid choices around credit card and lending options. Users are able to compare cards, loans and products they are pre-approved for, followed by a simple application process. Like Intuit, Credit Karma’s software is powered by machine learning technology which helps present personalized recommendations and is able to pre-populate customer data.

Other noteworthy announcements

• SoFi plans to launch crypto investing in 2019.
• Goldman Sachs is creating a new combined consumer and investment management division to grow the Marcus brand.
• Deutsche Bank promoted its recent investment in Modo Payments.
• Bank of America sees a future where its Erica assistant expands into trading and wealth management.

In other news…

In addition to the announcements and launches, VP of Amazon Pay, Patrick Gauthier, took to the stage to predict the future of voice assistants in payments. He expects Alexa to occupy more spaces outside of the home (I.e. office, car, even retail locations) and sees interactions spanning the entire process of making a purchase, from searching for items, making a transaction and following up on order status.

Day three closed with Laurie Riley earning the Money20/20 Startup Award for her company, Icon, which offers an alternative to traditional 401(k) plans. The runner-up was Henry Yoshida’s RocketDollar, which allows individuals to use IRA accounts to invest tax-free. Basketball legend, investor and advisor, Shaquille O’Neal was also on stage as a judge. O’Neal made perhaps the biggest announcement of the conference – his new nickname, “The Big Steady.”

Stay tuned for day four highlights and Mark’s overall thoughts on the big trends and themes of 2018’s Money20/20 – don’t miss it!

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Money20/20 Day Two: The Future of Financial Wellness

Mark Miller is Associate Director of Insights for Payments with Mintel Comperemedia. He focuses on credit cards, lending products, and the general financial services landscape.

October 25th, 2018October 25th, 2018

Day two at Money20/20 continued with the trend of financial wellness and inclusion, while also addressing current fintech hurdles.

Tim Chen, CEO of NerdWallet, kicked off the day by stressing the importance of comparison sites in providing simple, relevant information to consumers. This is especially crucial for those with lower incomes, who traditionally feel they have less choice in products, to instead select based on which products they qualify for. While Tim argued that complex programs like robot learning and artificial intelligence (AI) were not always needed to merely educate the public on financial choices, he did foresee a future where a simple algorithm could be designed to make the most healthy financial decisions for consumers.

Avoiding ‘fee fatigue’

Leaders of the most innovative fintech companies discussed how they can better serve customers in non-traditional ways. MoneyLion‘s Founder and CEO, Dee Choubley, described his service – which lets customers use funds as collateral against securing a lower-interest loan – as a “lifestyle” product, where checking, savings, investments, loans and rewards are all interconnected.

Lindsay Holden, Co-founder and CEO of Long Game, introduced a different approach. Long Game’s product uses gamification that encourages its largely Millennial and Generation Z base to save and awards customers in cryptocurrency. Holden argued that simple education was insufficient and while young consumers know they are supposed to save, they need a platform that enables the behavior and makes it enjoyable.

Jason Wilk, Founder and CEO of Dave, Inc., described how their product, which automatically predicts upcoming bills and adds up to $75 with no interest to prevent overdraft fees, helps customers avoid the debt trappings of traditional accounts. Dave’s “mission-driven business” is fueled by tipping and with each tip, the company plants a tree.

Fintech addresses modern challenges

In what has become a sentiment echoed across the first two days of the conference, TransferWise Co-founder and CEO Taavet Hinrikus stated that individual states regulating the fintech space put the US at a disadvantage compared to its European peers who typically only have to deal with one regulatory body. While he lauded the Office of the Comptroller of the Currency’s (OCC) proposed fintech charter as a step in the right direction, he encouraged regulators to listen to fintech concerns and design rules that benefit the consumer as opposed to the incumbent banks.

Caesar Sengupta, VP, Next Billion Users Team at Google

PayPal VP & Commercial Officer for Global Credit Darrell Esch talked about how reports of the death of the credit card are greatly exaggerated. He went on to say that credit cards would continue to exist, although the ways in which we use them will continue to change (e.g. less physical usage, more mobile wallets). He further argued that paper was the real enemy, as cash is “exclusive, expensive and insecure.”

The biggest event of the day occurred when Caesar Sengupta, VP, Next Billion Users Team at Google and Sir Richard Branson took the keynote stage. Sengupta discussed Google’s goal of transitioning global payments from cash to mobile money. He illustrated how they partnered with India’s government and Universal Payments Interface (UPI) to build a custom version of Google Pay that has already surpassed credit card payments in the country. Branson shared many tales from his non-conventional career from starting an airline, exploring space and landing a UFO near Gatwick Airport. He also described how Virgin Money began as an alternative to banks that he felt were opaque and predatory, and ultimately invested in some of the biggest fintech players today, including Square and TransferWise.

Stay tuned for day three, as we share a series of new developments and exciting announcements!

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Money20/20 day four: Final discussions and key trends

Mark Miller is Associate Director of Insights for Payments with Mintel Comperemedia. He focuses on credit cards, lending products, and the general financial services landscape.

October 26th, 2018October 26th, 2018

After four jam-packed days of announcements and insights from the biggest players in financial services, Money20/20 2018 has finally come to a close. Here’s what you need to know.

Announcements

The final day kicked off with keynote presentations on cryptocurrency, blockchain, credit scoring and a surprise announcement from the southeast Asian payments space.

Singer, entrepreneur, and philanthropist Akon took the stage to share stories about growing up in Senegal, dealing with tough neighborhoods in the US and how those experiences inspired him to make a difference in the global payments industry. His cryptocurrency ecosystem, Akoin, was designed to “give the young generation in Africa a platform to build Africa.”

Chris Larsen of Ripple predicted that cryptocurrencies are going to change the world, but cautioned that in order to do so, entrepreneurs, banks, and regulators will have to work cooperatively.

Will Lansing of FICO, Steve Smith of Finicity, and Gregory Wright of Experian discussed the new UltraFICO score. Unlike the more traditional model, UltraFICO incorporates banking behaviors such as daily and savings balances, overdraft history, and length of time accounts have been open. This option is particularly helpful in opening up new borrowing opportunities for those that have thin or no credit files and those with prime scores could see improvements and lower rate offers.

Reuben Lai, at Grab Financial Group, spoke about Grab’s recent acquisition of Uber’s assets in Southeast Asia. The Grab platform is becoming an “everyday super-app” for the 70% of Southeast Asians with no bank accounts and 90% without credit or debit cards, offering remittances, loans, and payments. As the session was wrapping up, Lai surprised the audience with the announcement that Grab was partnering with MasterCard to issue virtual and physical prepaid debit cards across Asia.

Key trends

Frictionless banking: This year’s conference buzzword. This idea of removing friction in the banking experience was echoed across many areas, including making payments, authentication, and access to products and services. With so much competition and new technology, banks and fintechs are focusing more on providing simple, fast, and secure platforms to meet a multitude of user needs.

Global innovation: From remittances to payments to regulations. Big Asian “TechFin” players like AliPay, WeChat, and Grab spoke about how platforms previously designed for a single purpose can expand to offer multiple products and services to customers traditionally left out of the financial services space. US players like Amazon and Google shared similar stories for both domestic and international customers. The regulatory environment was also key in these and other conversations, with many highlighting the difficulties for fintechs in the US based on the system of state charters and how this has led to more innovation in Asia in Europe.

Financial inclusion: As evidenced by Asian techfins, most of the innovation is geared towards providing access to the underbanked. Additionally, comparison tools from NerdWallet, Credit Karma, Intuit, the new UltraFICO, and the push for more proactive, personal financial coaches are helping the underserved improve financial health and gain access to better products and services. Fintechs like Stash and Dave, which are developing alternative fee structures, and global banks like HSBC and Deutsche Bank, which are partnering with technology companies to design new products, are all getting innovating towards more financial inclusion.

Biometrics, AI and crypto technology: Biometrics, particularly voice and behavioral, are advancing to produce the needed balance between security and convenience when accessing an account. Blockchain technology is being promoted as a background identification tool that is much less susceptible to fraud and identity theft (it’s worth noting, though, that the potential uses for the blockchain far surpass authentication). AI tools are evolving with virtual assistants learning more languages and conversational dialogue, while expanding deeper into everyday interactions.

That’s all for an exciting, momentous 2018! The countdown to Money20/20 2019 begins…

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The business value of design

Women in the Workplace 2018

A meaningful brand goes beyond customer need

by Nigel Hollis | October 17, 2018

Reading Joel Trethowan’s article ‘Need, culture and experience – three sides to the brand relevance triangle’  reminded me of the lengthy discussions predating the launch of BrandDynamics. The old BrandDynamics pyramid is long gone, and maybe the word “relevance” should be as well.

BrandDynamics was the product of an extensive exploration of how brand attitudes related to success in the marketplace. After reviewing data from Kantar Millward Brown’s tracking studies, along with academic and industry articles, the team and I came up with a five-level pyramid to depict attitudes that were increasingly related to purchase, from the base of “presence” to the peak of “bonding”.

We argued over what each level ought to be called, for instance, was “relevance” the right word and where did it fit in the hierarchy? In the end we kept the word and relevance became the second level of the pyramid. However, it was more a measure of whether the brand was ‘not rejected’ for consideration than an active ‘yes, this is relevant to my needs’, and one of the reasons for this was called out by Trethowan in his point of view.

Relevance is inherently more complex than simply meeting people’s needs. A brand has to be relevant to people’s functional needs, but it also has to be relevant to more emotional needs. As Trethowan notes, cultural relevance is a huge part of why people choose some brands and reject others. We can argue over whether Nike was right to use Colin Kaepernick as a spokesperson and what it might do to the brand (and society for that matter), but there is no argument that the brand increased its salience as part of the cultural conversation in the USA.

I find it interesting that Trethowan includes customer experience as the third side of his triangle, since in the old BrandDynamics framework this would have been “performance”. We felt that there was a difference between expectations that a brand might be relevant to the belief that results from actual experience. However, there is no doubt that experience is the biggest determinant of whether someone is likely to buy a brand, either by checking it out before buying for the first time, or buying it again after owning or using it.

All of which is a long-winded way of saying that I much prefer the word “meaningful” to describe the three dimensions of Trethowan’s relevance triangle. In the much simplified, updated and improved version of BrandDynamics meaningful captures both functional and emotional relevance and is heavily influenced by customer experience. We find that the combination is the foundation on which a strong brand is built. Meaning alone will not guarantee a purchase, a brand still needs to be salient in relation to specific needs and occasions and different enough to justify people paying the price asked, but it is critical nonetheless.

So while I do not have an argument with Trethowan’s premise that relevance needs to be a whole-of-business pursuit, I cannot help wondering if “meaningful” might be more relevant. But what do you think? Please share your thoughts.

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How brands can earn attention in our digital world

by Nigel Hollis | October 24, 2018

I am always amazed at the power of a good meme, but the idea that humans have an attention span shorter than a goldfish has had a disastrous effect on the advertising industry. Worse, it now appears that there is no real evidence to back up the original claim.

As you probably know the claim that the average human attention span was now eight seconds, shorter than that of a goldfish, first hit the headlines in 2015. Since then it has spawned a huge number of headlines and quotes, like,

“Humans have shorter attention than goldfish, thanks to smartphones”.

Only recently has the tide turned and articles have started to appear in the BBC and from Faris Yakob on WARC asserting that there is no proof to the claim. For instance, Professor Michael Posner, Institute of Neuroscience, University of Oregon, is quoted as stating,

“There is no real evidence that (the human attention span) has changed since it was first reported in the late 1800s.”

Human attention varies dramatically from task to task. With a bit of luck, you may still be paying attention by the time you finish reading this post. As far as science is concerned, ‘attention span’ is a colloquial term that encompasses several functions, including sustained, select, and alternating attention. And as for goldfish, there is no evidence that they suffer from a lack of attention either.

But here is the real problem. The goldfish myth, along with a misinterpretation of the convenience metrics generated by digital advertising, has led sites and marketers to try to compress content into shorter and shorter sound bites. Yes, it is true that the majority of people stop watching an online video after five seconds, but this is not an attention problem; it is a relevance and interest problem. The solution is not shorter videos; the solution is creating engaging content with which people want to spend time.

Evidence that engagement is the issue, not attention, can be found in the reports created by Ooyala, whose Q1 2018 Global Video Index  finds that more time is spent watching long-form content (defined as over 20 minutes) on digital devices than short-form content. Yes, even smartphones. It is all a matter of how interested people are in the content.

Now, your brand may not have the budget to produce The Crown but as big budget flops continue to prove, money is not everything. Brands must earn attention with remarkable, inspirational or useful content. They must also adapt to the environment in which the content will be seen. For instance, when viewers are in a skippable pre-roll environment, like YouTube, they want to be entertained. Most people skip after the first five seconds but if you engage your audience right from the start, you are much more likely to keep their attention for longer.

Are you still paying attention? If so, please share your thoughts.

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Measuring the influence of brand marketing on sales

by Guest Contributor Bill Pink | October 29, 2018

Bill Pink
Kantar Millward Brown
Head of Brand Guidance Analytics in North America
https://www.linkedin.com/in/williampink/

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Effective brand marketing increases the probability of consumers either picking a brand or paying more for a brand when it is time to buy.  But what data and analytic approaches help us to understand the influence of brand marketing on sales?

We know that brand and sales are not the same thing, and we know there are many influences on consumer choice beyond branded memories and associations such as availability, discounts, new product entrants, and changes in consumer needs. But even after controlling for these influences we still find it difficult to isolate the contribution of brand marketing. How can we do better?

The answer lies in going back to some first principles of analytics and putting them in a brand context. If we could build the ideal data set to understand brand impact, that data set would need to observe consumer choices and feelings at a highly granular level and cover a variety of users. Here is why:

First, granularity is key because we know different consumers are influenced differently by messages, product benefits, pricing, etc. When our data exists at a granular level, we can easily see these differences in action. Contrast this with analytics run solely at a macro or trended level. We may see flat trends in aggregate but we would miss movements within particular consumers, or groups of consumers, that average out to no change. Granular data uncovers these patterns, which is why so much of our work in this space focuses on bridging sales and brand data at a segment, region, or household level.

Second, we know that history matters. Ask yourself how often you are looking at two to three years of trended data for a mature brand? Or do a bit of homework and see how long that brand has been in existence in that category and market? I recently tried to understand the impact of brand equity on sales for a brand that was over 70 years old, but we had data going back two years and only at the monthly level. No surprise the data was rather flat and provided minimal variation to leverage. It’s extremely rare to have data on consumers going back so far in time to capture the initial launch, but if we were working with brand and sales data at a granular level then we would have a mix of recurring, new, and lapsed buyers in our data to work with.

Said bluntly, variation is the mother’s milk of analytics. And when trying to use analytics to understand the impact of brand marketing, we need to leverage data assets that allow for granular observations as much as possible to have variation in brand feelings, consumer outcomes, and different brand histories. Do you agree? Please share your thoughts below.

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Next X: Future of Women

Heritage hospitality

Fashion therapy, AI fragrance and more

Prescription art, apocalypse nutrition, aerosol albums.

–Dutch fashion label Schueller de Waal explores fashion as therapy, presenting a wellness center with massages and a hypnotherapy film in place of a new collection during Paris Fashion Week, i-D reports.

–IBM and Symrise are leveraging artificial intelligence to create customized perfumes, integrating millions of data points relating to taste preferences, demographics and consumer personality. Via Glossy.

–Montreal physicians are prescribing art museum visits “to help address both the physical and mental ailments of their patients,” BBC shares.

–To survive the apocalypse, just add lichen; a range of food products has been developed using the resilient and nutritious plant, which can grow in harsh climates, Dezeen writes.

–The band Massive Attack has remastered one of their albums as a can of spray paint, with each can containing “one million copies of the album, encoded as DNA and embedded within the matte black paint,” Dazed reveals.

–BBC explores how Gen Z social media behaviors and preferences are shifting, with Instagram overtaking Snapchat among US teens.

–Amazon is partnering with Qualcomm to create Alexa-enable headphones, says Fortune.

–Everlane is launching a clothing line made entirely from recycled plastic water bottles and has pledged to eliminate all virgin plastic from their supply chain by 2021, making them the latest brand to jump on the plastic-free bandwagon, shares WWD .

–Digiday discusses the implications of visual search technologies on retail.

–New augmented reality glasses use holographic displays to project smart phone notifications, in hopes of discouraging users from reaching for their phone, Vox reveals.

–This line of furniture is created using coffee grounds, Dezeen shares.

–Uber hopes to reduce carbon emissions by going all-electric in London by 2025, Fast Company shares.

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How Shifting Your Mindset Can Ignite Transformation

“Where your interior life meets your exterior impact is where transformation happens.”
—Keith Yamashita, SYPartners Chairman and Founder

In our most recent Creative Confidence Series chat, Keith Yamashita, SYPartners Chairman and Founder and instructor for our newest class From Superpowers to Great Teams, sat down with IDEO U Managing Director Coe Leta Stafford to discuss creative leadership and how great teams are built on a foundation of diversity, collaboration, trust, and self-awareness.

Keith Yamashita was having a stroke. The realization dawned on him as he sat on a conference call with a client, struggling to talk and spilling water as he tried to sip from a glass.

After three months of intensive recovery, Keith is doing well, but the experience of losing physical control of his body and the ability to communicate further clarified for him the reality of our ever-changing nature. “We are never static as people,” he says. “Our bodies are biologically shifting every moment.”

This acceptance and embrace of change is a core tenet of Keith’s approach to creative leadership. A growth mindset is critical to successful leadership, and the connections we form with other human beings are the foundation of our work life. Through his work at SYPartners—a transformation company that helps human beings, organizations, and societies become fuller, more vibrant versions of themselves—Keith helps leaders build their bravery and summon their creativity to design great futures and build the capability to constantly transform.

“Each of us comes into the world curious, open, wanting to bond and wanting to have great connections with other people,” he says. “Our training, societal norms, school, and early jobs beat all of that out of us.”

 

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“Through your own mindset and behavior, you dominate much of your own reality.”
Keith Yamashita

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Transformation Starts with Internal Reflection

Most traditional businesses focus on external outcomes—impact on revenue, growth, and bottom line. But Keith believes that a leader’s ability to connect with their internal landscape and find joy, happiness, and depth in their work is even more important to building creative leadership skills, and that “where your interior life meets your exterior impact is where transformation happens.”

“We’re not just made to get paychecks,” he says. “We’re not just made to go to work. We are social beings who together can do great things. This, I think, is the great opportunity of our times.”

While internal reflection is critical to growth as a leader, it’s often where the toughest work lies. Only in challenging our mindset can we open up opportunities for growth and find ways to work effectively with people who think differently. “Through your own mindset and behavior, you dominate much of your own reality,” Keith says.

To start, look internally at the dialogue you have with yourself:

• Do your beliefs engage and nurture you, or hold you back?
• Think of how you reacted to a challenging circumstance at work. What are the facts of what happened vs. the story you’re telling yourself?
• What does transformation mean for you as a leader?

Looking forward, Keith poses a question: “Can we imagine a world that is significantly better than today and use our talents and diversities to make that world?”

The Business Case for Diversity

While diversity has more recently been approached as a challenge to overcome, Keith urges us to reframe it as “the gateway to joy, to collaboration that matters, to your own evolution as a human being, and to tap into the talents of those around you.”

Dr. Scott Page, a leading thinker on the economic impact of diversity, presents compelling evidence in the business case for diversity. His research shows that diverse teams outperform non-diverse teams by significant margins, especially on problems that require creativity, new thinking, and synthesis of knowledge.

SYPartners has worked with many large companies like Starbucks, IBM, and BlackRock Capital to find tangible ways to build diversity into their businesses. BlackRock—a firm focused on evaluating risk in order to make investment decisions—now categorizes lack of diversity within teams and organizations as a huge business risk. They’ve realized that “mono-minded” teams lack the ability to see the patterns, connections, and opportunities that teams built on diverse backgrounds and viewpoints can identify.

And when we think of diversity, it’s critical to go beyond more visible elements like race and gender to include cognitive diversities like background, schooling, and homelife.

 

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“Can we imagine a world that is significantly better than today and use our talents and diversities to make that world?”
Keith Yamashita

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Turn Microaggressions into Micro-Actions

So we know building diverse teams is important, but how do we go about it?

The path towards diversity begins with identifying roadblocks to change:

• Mindset: If you have a fear-based view of the world, shift towards openness and a growth mindset.
• Unconscious biases: These are assumptions and shortcuts our brain creates to help us function in a complex world. Everyone has them, but they hinder our ability to be open-minded.

Retrain yourself by making conscious choices about how to interact with others. These changes in behavior don’t have to be big and overwhelming to be impactful. Just like microaggressions add up over time to negatively impact someone, small positive choices can compound in a much larger way.

Keith’s advice: Put in place a practice of positive micro-actions. Your day will naturally offer 100 different opportunities to make choices. Take advantage of just some of those opportunities, and pretty soon diversity, equity, and inclusion will be built into the way you act every day.

SYPartner’s framework for micro-actions identifies moments in your workday where diversity can add benefit and asks questions to cue a positive micro-action, like setting aside assumptions when recruiting a new team member.

“Diversity and inclusion have to come from natural behavior,” Keith says. “This is the pursuit of getting to know other human beings and getting to do work together that you wouldn’t otherwise get to do.”

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To learn more about building diverse and effective teams, check out our new From Superpowers to Great Teams on-demand online class.

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Build Team Trust with this Self-Reflection Activity

“It is only in teams where you have the courage and bravery to be your full self that you can contribute your best.”
—Keith Yamashita, SYPartners Chairman and Founder

Self-reflection is a key element to personal growth and allows us to be more aware of ourselves and how we show up at work. By looking inward, we can be more open and honest about what makes us who we are and make more authentic connections with others.

In our latest Creative Confidence Series chat, Keith Yamashita, Founder and Chairman of SYPartners and instructor in our class From Superpowers to Great Teams, shared this exercise to guide individuals and teams through the process of reflecting on and embracing their full identities.

Try this activity to build trust among your teammates and uncover the skills and perspectives you can each bring forward.

 

 

Step 1 — List Every Aspect of Your Identity

Think about the phrase “I am _____.” Now, fill in the blank. Get out a piece of paper and write down every word that comes to mind. This should be a long list.

Go broad, and include all kinds of things that make up your identity. When Keith does this exercise, he writes that he’s a trained economist, a father, gay, a dog owner, a Scrabble expert, a hoarder, a pencil maniac, and much more.

Our identities are composed of limitless aspects of ourselves, not just the pieces we bring to work.

Step 2 — Unveil Your Hidden Identities

Now think about which of these identities you tend to shelter or hide and which you bring into a work context. When you step into a new situation, for example meeting a new team or introducing yourself to a room of strangers, which identities do you hide?

How does the situation affect which aspects of yourself you bring forward and which you shelter?

As Keith says, you have all this richness about you, but by not sharing these different aspects of your identity with others you’re depriving the world of your full talents and your full self.

Step 3 — Unpack Identities with Your Team

Repeat this exercise with your team. Have everyone write out their identity list then separate into pairs. Without looking at their lists have everyone share their identities with their partner. Guide a discussion around what elements of their identities people shared, and what they omitted (either purposefully or unconsciously).

“We’re constantly depriving others of our full humanity,” Keith says. “Every single word you leave off is a richness that you could explore.”

This may feel uncomfortable at first, but the goal is to build trust among your team so that you create a space where it’s safe to bring your full self to work.

Research shows that diverse teams outperform non-diverse teams by significant margins, especially on problems that require creativity, new thinking, and synthesis of knowledge. The complex problems modern businesses face require everyone to bring the entire toolbox of skills they possess as individuals. Right now is the time to be more open than ever before.

“It is only in teams where you have the courage and bravery to be your full self that you can contribute your best,” Keith says. “And it’s the only place creative leadership can thrive.”

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Learn more about Keith’s approach to creative leadership and find out how to uncover your hidden strengths in our From Superpowers to Great Teams online on-demand class.

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Brands Shouldn’t Believe Everything They Read About Themselves Online

Is Retail Dying? Plus, How Are Companies Spending their Tax Cuts?

Youngme Moon, Mihir Desai, and Felix Oberholzer-Gee discuss whether the “retailpocalypse” is real, try to figure out how companies are spending their Trump tax cuts, debate whether share buybacks are a good thing or a bad thing, and offer their picks for the week.

Download this podcast

HBR Presents is a network of podcasts curated by HBR editors, bringing you the best business ideas from the leading minds in management. The views and opinions expressed are solely those of the authors and do not necessarily reflect the official policy or position of Harvard Business Review or its affiliates.

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Megatrends Shaping the Future of Travel

On November 6, Euromonitor International’s travel research team will introduce a report on Megatrends Shaping the Future of Travel at the World Travel Market event in London.

The report identifies the most influential megatrends transforming the way we travel and do business. Concerns about travel impacting the environment, digital detox and travel simplicity are some of the world-changing patterns presented in the report.

Register today to ensure you receive this year's report as soon as it is released.

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Understanding Consumers’ Earning and Spending Patterns

Insights into consumers’ spending patterns are essential to business success, helping companies understand their target markets and devise long-term strategies based on their consumers’ potential purchasing power. Income and expenditure data not only allows businesses to determine market size and forecast its growth but also provides a uniquely detailed picture of consumer spending patterns. This type of information can help segment the market, assess consumer demand and pinpoint opportunities.

Silver consumers in the beauty and personal care industry

People aged 65+ represent a large and growing consumer group, due to lower birth rates and longer life expectancy. As well as growing in number, older people are generally in better financial health than some younger segments of the population, with a rising number of older people continuing to work and earn an income beyond the age of 65. Additionally, older people have a propensity to save less and spend more in their later life.

Global Average Gross Income by Age: 2012-2030

The beauty and personal care industry has always been focused on the youth, but businesses are now waking up to the fact that older consumers are the ones with high discretionary spending power. This has been seen in a growing cluster of brands that cast older models in their advertising campaigns. L’Oréal Groupe, for example, has gathered together actress Andie MacDowell (aged 58) and models Helena Christensen (47), Tatjana Patitz and Karen Alexander (both 50) and Amber Valletta (42) to front a campaign for its new, most potent anti-ageing product, Revitalift Laser Renew The Double Care.

Rising opportunities for African internet retailing

Africa’s young, fast-urbanising population, with a burgeoning middle class and strong consumer expenditure growth have led to the narrative of “Africa Rising” and captured the attention of businesses as a key future market. During the 2018-2030 period, real consumer spending in the Middle East and Africa region is expected to grow by 51.5%, equivalent to 3.5% per year on average (compared to the global average of 2.7% per year).

Online retailers such as Jumia, Kunga and Spree have been growing exponentially in Africa to cater for the continent’s young, growing and connected middle class, with rising demand for a wide range of products that store-based retailing cannot meet, due to a lack of shopping malls and gridlocked cities.

Auto-makers bring women on board

Women will still earn 35.7% less than men on average in 2030 and women’s annual disposable income will rise by 29.4% in real terms between 2016 and 2030. Even though the gender income gap is hardly narrowing, the global female consumer market – with 3.6 billion consumers and rising incomes – is too large for businesses to ignore.

Female consumers are becoming increasingly prominent in the automotive industry where cars are not traditionally designed by women with the female consumer in mind nor marketed to them. A growing number of automobile manufacturers including Citroen, Honda, Jaguar Land Rover, Nissan and Volvo now have women working at the top levels of their design teams. By bringing female designers on board, the automotive industry recognises the influence women have on important household buying decisions that include car purchases.

Income and Expenditure Insights

Income and expenditure insights, such as who the consumers are, where they live, how much money they earn and what they spend their money on are truly critical to business success. These insights help companies understand market potential, target consumers within appropriate income bands and devise long-term strategies such as whether to enter a prospective market or which products and services to offer and at which price points.

 

Euromonitor’s Passport database helps identify key changes in consumer income and spending patterns. For additional insights on Income and Expenditure, request a demonstration of Passport.

 

The post Understanding Consumers’ Earning and Spending Patterns appeared first on EMI Blog.

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Google Working on Solving the Pain Points in Vacation Package Shopping

For anyone who’s ever shopped online for a vacation package where the flight and hotel are bundled together, you’ll know it can be a tedious exercise.

First you might find a holiday package on Expedia, for example, and then you’ll have to figure out at least two things: Is it cheaper to book the package versus buying the flight and hotel separately, and then you’ll want to search to see whether another vendor, such as Virgin Vacations, has a better deal.

The process can be frustrating because there are a lot of variables, and the rates change frequently, too.

Enter Google, which has been testing vacation rental metasearch, where users are transferred to third parties for bookings in the UK and Germany within its Destinations category since the spring of 2017.

Speaking at Skift Global Forum last month, Richard Holden, Google’s vice president of product for travel, said that effort will be expanding in a number of ways.

“We do offer it now in the UK, Germany and the U.S.,” Holden said.  “I would still say that it’s not prominent in its display at the moment; it’s fairly buried in the destinations experience. The next version of this we’re working on at the moment to make it more prominent and Germany is actually probably the first market that we’re most focused on simply because Germany is a very large package travel market as a whole.”

Skift has seen the product on Google in a number of forms: on desktop in the Destinations  section and in the Travel Guide category, and at the very top of the page under Destinations in Google Germany or further down underneath paid ads in Google U.S. desktop.

But, the vacation package search product, which is likewise on mobile, is indeed becoming more prominent, although it is far from perfected, as can be expected with such a complex feature. But Google is already addressing some of the pain points in vacation package search, albeit in a rudimentary way so far.

Holden explained Google’s thinking.

“But we still think this is a great opportunity from a transparency standpoint,” Holden said. “Users just don’t know where to find this data. There is no great place to go to understand all the packages that are offered out there and from a transparency standpoint, we’re also trying to show people what that package travel would look like and what the component pricing looks like so they can compare right there.”

On mobile in the U.S., we entered Germany vacation packages on Google and found 102 options for trips to Berlin, for example, along with a widget to refine dates and destinations, as well as maps, amenity descriptions, photos, ratings, and reviews.

An Expedia vacation package for a Wow Air flight and a 3-night stay at the Sofitel Berlin Kurfürstendamm shown on Google.

For Berlin, we found several Expedia flight and hotel packages, including those for a Sofitel Berlin Kurfürstendamm-Wow Air three-night package from New York City in early November for $1,175 per person; a Park Inn by Radisson Berlin-Wow Air package for $1,061; and Steigenberger Hotel Berlin-Wow Air package for $1,157.

Along with each Expedia package price, Google listed the price for booking the flight and hotel separately from Wow Air and Agodo or Priceline, for example.

The main value proposition in packages is the traveler is supposed to get a considerable discount because the airlines and hotels can fill seats or beds without disclosing the pricing on the individual components because the traveler only sees the package price. The hotel or airline therefore can offer discounts without diluting their published rates.

Ironically, though, the differences in the package prices and those when someone books the individual components separately that we saw on Google were not very large, sometimes nonexistent. For example, the Expedia package for the Sofitel Berlin Kurfürstendamm-Wow Air package was $1,175 versus $1,173 when the flight would be booked on Wow Air and the hotel on Priceline.com.

As noted, Google’s vacation package search is very much a work in process. We’d expect in the future to find considerable discounts for vacation package prices versus booking the flights and hotels separately.

But Google will work out the kinks, and the ability to compare holiday packages from vendor to vendor, and also to determine the discount versus individual components one one place will be a compelling premise since there aren’t many easy ways to do that today.

In other news, Holden said Google is now offering a way for consumers to search for vacation rentals outside the United States in major metropolitan areas.

“We struggled for a little while as to what’s the right way to integrate those offerings,” with hotels, Holden said. “We are actually offering it now outside the U.S. as a filter in hotel search in major metropolitan areas. There’s content that you can filter in to see alternative lodging or vacation rental content. Typically today, the content that we have there is apartment-like, it’s most hotel-like properties, though we will be in the near future moving into a broader set of properties as well. We think it’s hugely relevant.”

Photo Credit: Beach-goers enjoyed the sands at the Jersey shore in New Jersey after Hurricane Sandy. Wayne Parry / Wayne Parry

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Fighting Biz Travel Burnout

How much business travel is too much for the seasoned road warrior? Well, the evidence shows it’s less the frequency of travel than the travel experience itself that leads to botched meetings and self-destructive behavior.

This week I explored a report polling road warriors on what is ruining their lives. Balancing work and life remains a major hurdle, although the elements that improve a business trip aren’t too hard to predict: More sleep and more comfortable flights lead the pack.

There is also evidence that pushing business travelers too hard is leading them to leave their jobs for something requiring less soul-crushing travel that distances them from their families and leads to gluttonous In-N-Out Burger binges (just speaking from recent experience here).

We’ve also got the latest on how U.S. airlines are jacking up fares to outrun rising fuel prices, courtesy of Senior Aviation Business Editor Brian Sumers. Could the recent era of low fares driven by competition be coming to a close? Looks like it, although the airlines have complex arbitrage methods to deal with fluctuations in fuel prices.

If you have any feedback about the newsletter or news tips, feel free to reach out via email at as@skift.com or tweet me @sheivach.

— Andrew Sheivachman, Senior Editor

Airlines, Hotels, and Innovation

Frequent Business Travelers Need More Sleep to Survive: I’m tired, you’re tired, we’re all tired when we travel for work. It’s leading employees to burn out and quit, causing problems for travel managers and companies that push their workers too hard. Some sleep and nicer flights can help.

Group Booking Pace Slows in Tight Market for Meetings: New research from Cvent shows that group business is declining for U.S. hotels, and planners are booking room blocks closer to the date of their event than before. This is bad news for hotels, which rely on group bookings to boost business.

Delta Air Lines Sees Premium Profit: Travelers hoping for more free first-class upgrades should probably root for a recession. The economy is too strong for airlines to give away their best seats for free.

United Airlines Avoids Fuel Cost Hit to Earnings With Higher Ticket Prices: We told you United would probably turn things around on finances when it hired revenue whiz Scott Kirby back in August 2016. And look what’s happening. Now, it’s time for the airline to improve its customer service, too.

The Future of Travel

Cvent Buys Social Tables as Event Tech Consolidation Escalates: Cvent is working methodically to expand its offerings in the small meeting space by acquiring Kapow and now Social Tables. Social Tables found success streamlining obvious pain points for planners, which is something Cvent can learn from.

Measuring the Value of Wellness to a Hotel Brand: Every time you turn around these days, a major hotel company is announcing that it has hired a chief wellness officer. But will this wave of devotion to wellness be a phase or a long-lasting phenomenon? Look to the return on investment for that answer.

The TSA Plans to Use More Biometrics at Airport Security Checkpoints: We hear good things about the reliability of facial scans at airports with one exception. JetBlue Airways reports that the system in place at its terminals is not as effective with the oldest travelers as it is with everyone else.

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Skift Senior Editor Andrew Sheivachman [as@skift.com] curates the Skift Corporate Travel Innovation Report. Skift emails the newsletter every Thursday.

Subscribe to Skift’s Free Corporate Travel Innovation Report

Photo Credit: In this March 17, 2016, file photo, travelers wait in line for security screening at Seattle-Tacoma International Airport in Seattle. Ted S. Warren / Associated Press

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Skift Global Forum 2018 Recap: Humanizing the Travel Experience Is Key to Building Loyalty

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Nearly 30 speakers took the stage at last month’s Skift Global Forum to discuss the leading trends and innovations top of mind for the people defining the future of the global travel industry.

Perhaps unsurprisingly, investment in technology to improve both product offerings and customer insight was cited as one of the major themes by industry speakers throughout this year’s conference. Delta Air Lines CEO Ed Bastian declared that free Wi-Fi would (eventually) be available on board. Christine Duffy, president of Carnival Cruise Line, touted the company’s Ocean Medallion technology, which provides passengers with a personalized cruise experience through a wearable wristband. And TripAdvisor CEO Steve Kaufer spoke about the company’s push for more curated recommendations to the individual, just to name a few examples.

However, many speakers added an asterisk to the increasing presence of technology in travel, cautioning that prioritizing the human element is critical to truly connect with customers. Joanna Geraghty, president and chief operating officer of JetBlue Airways explained that the airline was founded on the idea of “bringing humanity back to air travel” when it was launched 18 years ago. She further explained that individual employees are often mentioned by name when customers leave positive reviews about their JetBlue experience.

Mark Hoplamazian, CEO of Hyatt, discussed how the company is evolving its vision to facilitate mindfulness and wellbeing, both on and off property, allowing its customers to “fulfill the purpose of being their best selves,” through its FIND platform and hiring of a chief wellness officer. Meanwhile, Jack Ezon, founder and managing partner of Embark, and Matthew Upchurch, CEO of Virtuoso, discussed the strong future ahead for luxury travel advisers, despite advances in technology. “Agents who were like human vending machines have gone away, and the ones that focused on providing value have thrived,” said Upchurch.

Ian Schrager, founder of the Morgans Hotel Group and pioneer of the boutique hotel movement in the United States perhaps spoke most candidly about how customer experience can often get overlooked due to the fancy bells and whistles that come with new technologies. “I think technology is the future –– but not mood boards in the lobby or iPads in every room…” He explained that hotel companies need to remember that they’re in the hospitality business and that the guest experience needs to include “something that astonishes people” with added “excitement” and “glamor.”

Hermès, a leader in the luxury retail sector, also understands the importance of human connection. Robert Chavez, Hermès’ president and CEO for the Americas, explained how the company still does much of its business in-person. Face-to-face communication and impeccable service with customers is so important for the retailer that Hermès doesn’t hire applicants who aren’t naturally inclined to connect and engage. “You can’t teach someone how to smile,” said Chavez. And each store has slightly different inventory, chosen by the store’s director, who flies to Paris a couple of times per year to choose products catered to its particular clientele.

While technology enables truly great and seamless travel experiences, technology itself is a means, not an end. Connecting with travelers on a human level is the piece that will truly differentiate good brands from great brands. Delivering memorable, emotional experiences is the best way to foster long-term loyalty among travelers and stand out in a market that’s constantly innovating.

Olson 1to1 provides loyalty technology, strategy, creative, analytics, and program management for some of the most well-known hotel and travel brands. Our mission is to help clients build meaningful, lasting, and mutually beneficial relationships with their customers, with an emphasis on infusing humanity into the experience. To learn more, download the report.

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This content was created collaboratively by Olson 1to1 and Skift’s branded content studio, SkiftX.

Photo Credit: Hyatt, CEO Mark Hoplamazian with Rafat Ali of Skift at Skift Global Forum 2018

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How Travel Marketers Can Make the Most of Global Cultural Events

Global events influence travel trends around the world, regardless of whether they’re planned or spontaneous, positive or negative. Huge crowds of travelers pass in and out of host cities, giving hoteliers good reason to capitalize on their habits and activities.

But an event’s popularity is not the only factor that impacts the resulting tourist habits in those cities –– any number of unpredictable details leading up to those events can influence travel trends. And if travelers are planning ahead, travel marketers should be too.

Koddi, a cloud-based marketing technology company for travel brands, developed a recent study to see how some of the past year’s largest global events impacted tourism trends around the world.

The 2018 Travel Index looked at booking windows, attendance rates, weather events, and generational trends of events, ranging from the Women’s March in Washington, D.C. to the FIFA World Cup in Moscow, to determine how travel marketers can effectively build global events into their overall business strategies. Here, we look at a few takeaways from the study.

Let’s Play Ball: International event ticketing forces sports fans to plan ahead
Cities clamor to host sporting sensations, such as the FIFA World Cup and the Summer and Winter Olympics, hoping that highly-televised international attention will boost tourism and improve their public reputations on a global scale. And millions of sports fans often snatch up limited ticket releases and secure their accommodations during the same booking windows.

Most sporting events result in booking windows an average of 43 days ahead of the events themselves. But exceptions do occur when tickets are released outside of that window. For example, ticket lotteries for the 2018 FIFA World Cup in Moscow were released 90, 60, and 30 days before the World Cup actually took place. Corresponding booking spikes took place at each of those markers, suggesting that as fans scored event tickets, they turned their attention immediately to their accommodation needs. Savvy travel marketers also adjusted their campaign budgets to capitalize on this trend by initially dialing up ad spend 90 days prior to the events and, in the case of the World Cup Tournament, increased their ad spend by nearly 350 percent in the 30 days leading up to the first game.

Marching Orders: Grassroots political rallies leave little time to plan
Whereas sporting fans tend to book their accommodations in advance, travelers attending large-scale cultural events like political rallies are often considerably more impulsive. Rallies like the 2017 Women’s March and the 2018 March for Our Lives in Washington, D.C. were attended by millions, but no advance ticket sales were required for people to participate.

Booking windows for political rallies average 35 days, largely due to the grassroots nature of such events. Social activism arises in response to the local political climate, and ralliers who believe in the cause of a march show up in droves with hardly any advance notice.

Besides investing in campaigns with shorter booking windows, travel marketers should also consider optimizing their campaigns for mobile with ad spend going to in-app and social. Due to the shorter booking windows, many travelers are making their last-minute hotel reservations via their smartphones.

The Beat Goes On: Music festival-goers save hotel bookings for last
Ticket sales for music festivals around the world go on sale months ahead of time, and in some cases, are even released an entire year in advance. However, although festival travelers book their tickets well in advance, they don’t seem to book their lodging until much later. Most festival host cities don’t experience a spike in booking windows until four to six weeks before the actual event.

This timing disparity between buying tickets and booking hotels may be attributed to the fact that many music festivals are hosted in already popular tourist destinations, like the Rock in Rio festival in Rio de Janeiro and Coachella in sunny California. Another factor in later stage booking windows may be the availability of alternative accommodation options with competitive rates, like Airbnb and HomeAway.

Again, optimizing campaigns for mobile devices –– especially with spend on social media channels –– becomes increasingly important for increasing booking volume among music festival-goers.

Expect The Unexpected: What it takes to weatherproof your travel strategy
Unfortunately, destinations around the world that have been devastated by natural disasters and inclement weather events, like hurricanes and earthquakes, have seen real losses in tourism bookings over time. Hurricane Maria caused a 40 percent bookings decrease in Puerto Rico in 2017 –– and that’s on top of the immense property damage and loss from which the region is still recovering. Indonesia was recently struck with two earthquakes ranking 6 and higher on the Richter scale and suffered a 26 percent bookings decrease as a result.

But surprisingly, dramatic weather phenomena can also spark modest increases in bookings in the periods immediately following those events. For example, Houston experienced a 5 percent increase in hotel bookings during 2017’s Hurricane Harvey. These last-minute booking spikes are often influenced by evacuation orders that force residents from their homes and by the influx of volunteer workers and first responders who flock to affected cities to help with disaster recovery.

Actionable Takeaways for Travel Marketers
Events ranging from the musical to the athletic and the political to the meteorological can all trigger spikes in the popularity of the cities where they take place. To stay aligned with the needs of travelers and spend on advertising wisely, travel marketers should:

• Plan on increased volume from cultural events in popular tourism destinations
• Budget for visibility during the primary ticketing periods for major sporting events
• Focus on last-minute booking services for music festivals and political rallies
• Adjust ad spend if property is damaged by an unexpected natural disaster
• Make sure campaigns are optimized for mobile, as many last minute bookings are made via smartphone

Of course, spikes in bookings and popularity often come with corresponding lulls. As long as travel marketers plan with major events in mind and stay nimble in response to the unexpected, global events can actually contribute to overall business strategy instead of knocking those plans off track.

To learn more about Koddi’s 2018 Travel Index and see what Koddi can do for your travel business’ advertising and metasearch optimization, click here.

This content was created in collaboration with Koddi and published by Skift’s branded content studio, SkiftX.

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