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Florent Giraud

on 28 November 2013

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Understanding the future tourism consumer
Moffat Centre and Scholarships
Professor J John Lennon
Centre for Travel and Tourism, Glasgow Caledonian University, UK
• Moffat Centre revenues created by trading; work in more than 45 countries on over 600 projects
• Since 1999 £1.3 million in scholarships awarded by the Moffat Centre to students interested in studying Tourism subjects
• Details www.moffatcentre.com

When I began...
• Access
• Attractions
• Accommodation
• Activities

Now the catalysts...

Now the catalysts
• Low Cost Carriers
• Growth of Cities as destinations
• Rise of Retail as the alternative attraction
• Centrality of Web / electronic marketing and data sourcing

Understanding the future Consumer
• What do we want to achieve ?
• Visitor Numbers / more customers always a good starting point to understand business
• Something of a struggle...when we are not great at understanding the consumer
• Lets consider...
Tourism Development
Holiday Buying Behaviour
Decision Making
1. Mother

1. Mother
2. Children
3. Father ?
1. Mother
2. Children
3. Dog
4. Father

Designing for Consumption
• Do we design hotels with knowledge of consumers ?

• Spaces we create and how they are used

• Critical Touch Points
• First Physical Contact
• For example; Check in

• Attention is focussed on
owners of credit cards
• Other adults

• Service encounter can be transformed if attention is focussed on reasons for holiday location / choice / expenditure

• OR the most important people in the parents lives...
“ Its OK John, we employ lots of teenagers
and they know how to look after small children because they have younger brother and sisters.”
Their Children
Service encounters with Children
As we know the Experience
• Is now electronic
• 100% Transparent
• Trailed and Photographed
• Displayed and exchanged
• Consolidated and detailed
• Twitter, Facebook, Tripadvisor...
Scale is important here
The number... 500 million...
of photos uploaded and shared every minute in 2013
This has changed our industry and will continue to do so
It’s a race with the retailers
• Oxford Street, Regent Street, Bond Street in London
• The largest combination of retail spend on the planet
The race is over • British Museum 5.5 m visitors
The race is over
• British Museum 5.5 m visitors
• Oxford Street Footfall 140 m visitors
• 81% of tourists to London list shopping as a must do activity

Our World in 2013
• How is it characterised ?
• How is it defined ?

Our world
• Seems like its all about IT and Retail
• So I needed a plan...

Our World
My approach
• When I knew you wanted to understand future consumption I interviewed people
• People a lot smarter than me...
• But not from tourism people like...
• Chief Executive ASOS
• Chief Technical Officer Microsoft

• £1+ Billion Retail Sales
• No Stores
• 1 Warehouse, 7 websites, 150+ countries
• Free Delivery
• UK based
• UK 3% of consumer base
• In 8 years UK 1%

• Internet is just another phase of retail development
• Technology is an enabler allowing people to make big decisions in a very short time
• But what about Oxford Street, London
• Everyone still goes to TopShop

• Choice is killing the Old World
• Not everyone has access to Oxford Street or TopShop, Oxford Street
• They do on the internet
• Choice on-line v Choice in Store
• Building web appeal
• No one enjoys viewing 7-8 websites - better one site that has everything
• Then make it Personal – how do we simplify the offer / profile algorithm
• 1 They buy at night / 2 They buy a lot on line / 3 Personalisation and the idea of a personal stylist helps (style library)
• Building awareness – from web to brand
• ASOS saw space opening in fashion
• Employed young people who...
• Love Fashion
• Love mobile
• Love internet
• They also love holidays as Facebook will testify
• Largest clothing retailer in Australia with no traditional marketing and 2-3 days delivery time
• Awareness and growth only via Facebook, Twitter and other social media channels
Microsoft : shaping future
• Pervasive Connectivity
• HD Collaboration
• Natural Interaction (wearable nanotech) • Everyone’s mobile
• Social Graphics
• Big Data and Better Insights
In Store experience is on-line
• Marketing
• Everything is about story telling
• The new shopping
• No longer “How can I help you ?”
• Now its how can I help myself

Buying the Microphone
• Scan microphone bar code on line
• See what users think of the product
• Compare price on line / in store
• Shopping has changed

Are you really keeping pace with technology ?
7 years is an eternity

• The toddlers favourite toy
• Baby friendly Apps
• Toddler Teasers, Baby Fun !, Instant Arcade, Peek-a-Boo, Pocket Zoo.
• Apple is the favourite brand among children
• Pass tablet to child and they are hooked
• But I want the best for my child...

The Centrality of Brands
• By 2 years 90% of all infants are watching screen media regularly (developed world)
• Brand recognition 18-24 months
• By 36 months US children can recognise up to 100 brands
• Brand preferences expressed at age 4-5 years
• 56% of adults use brands they remember from childhood

Think about brands and teenagers
• Anxiety and belongingness
• Majority of teenagers believe buying branded goods will enhance confidence and peer acceptance
• Superdry T Shirts, Abercrombie Hoodies
• Todays teenagers spend 5-6 x the revenues their parents spent on clothes

Brands and Teenagers
• During the period of identity development belonging is a powerful urge for children
• Alignment with an external force – using the attributes of that group, that object helps define themselves
• More than 60% of teenagers consider brand when choosing clothes and the majority would be reluctant to wear non- branded goods
Brands and Teenagers
• That’s how Abercrombie can charge £50 for a T shirts and Apple £590 for a phone

Think about
this brand
So who really understands the customer ?

Clue... its probably not a major hotel chain
So who then... ?
• If it was a country it would be between 2nd and 3rd largest in the world by population
• More than 60 million daily status updates
• Its where everyone is
• Its where we construct our lives
• Where we send messages, post invites,

Probably Mark Zuchenberg
Understanding customers
• Where we post pictures (more than 1 billion images posted per week)
• Where we say what we like (the importance of peer recommendation)
• This material is gold to those who mine data...and big data and understanding your likes, needs and wants is where the market is going

• Welcome to the £70 billion world of data mining / knowledge discovery / consumer insights
• Companies now can chart your buying habits, race, gender, address, phone no, education, approx. income, family size, pets, film choice and much more creating an ability to understand...

• The motivations and understandings around what customers buy and do
• Every element of what you purchase can be monitored
• An airline boarding card or a discount voucher printed from your computer with a bar code gives access to your computer IP address, Facebook profile and posts, date and times you printed and used the boarding pass

Understanding buyer behavior
Your on line behaviour will be matched to in store purchasing, in this way retailers can understand what ads work for your demographic/ population profile
Lets look at use ...
• The aim is to build programmes based on recognition and relevance which comes from knowing preferences, loyalty cards...
• In 2011 major concern when it emerged that iphone and Android phones contain software that tracks and records users locations. Location updates every few seconds why ...A $3 billion market for location based services

• Walmart – POS data captured from 3000 stores in 6 countries held in a 7.5 terabyte warehouse (8 x size of US Federal Governments storage facility)
• Why ? What sells and what doesn’t
• Example Hurricane Warning – what to stock ? Torches and batteries
• Beer
• Pop Tarts (Strawberry flavour)

Best of all Google
• Now with Google maps it knows where you live, car parked in driveway, whether or not your fire is lit...
• Now Google will know who you like on Facebook, who appears in your photos, what you tweet about...
• Welcome to the post privacy age
• Most sophisticated predictive algorithms and data tracking capabilities
• Google knows what you search for, links search to computers used, knows what online videos we watch, music you stream, articles read, files downloaded, knows what's in your emails (scans automatically for serving contextual advertising).

Personalised sales
That brings us back to the consumer

• The aim here is to get close to people
• So do not loose heart
• Those people sit in your restaurant, eat your breakfast, sleep in your beds, take your rides, pay your admission

Access to Customers
• People are with you for valuable time
• They are much more likely to follow a purchase recommendation from someone they know or trust
• Humans still have an important role here • Do not squander this time

Tourism can compete
• Holiday is a must do
• Travel is the norm
• Authenticity and personal contact is the desire / aspiration
• Personalisation is at the heart of most of the algorithms used for profiling
• Here is the advantage for tourism...
• Contact

Consumer Forecasting
• Ask Yogi Bear
“This forecasting stuff is really tricky especially about the future”
• Thanks
• Enough from me
• Questions welcome
• www.moffatcentre.com
• jjle@gcu.ac.uk
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