Caught in The Optimization Loop? Prepare to be Disrupted

Focusing on one’s core mission is critical to any company’s success.  For startup or growth-stage companies, focus can often mean the ruthless elimination of any effort that detracts from the path that will lead to success.  At large organizations, focus means a rigid adherence to the core business process or model that got them there.

In either case, companies all too easily get caught optimizing on their core process, opening themselves up to being unexpectedly disrupted.  They think they’re innovating when they should be OUTovating.  They get caught in what I call The Optimization Loop.

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Big up to Spencer Watson for an image that captures our themes of a loop, focus and myopia.

Optimization is Good…Till it’s Not

Optimization in this context refers to the practice of making continuous, incremental improvements to the core aspect of a business – whether it’s conversion, performance or processes – as opposed to more large-scale, sweeping innovations.

I’m not going to argue against focus – it’s been a key part of the successful ventures with which I’ve been involved.  Finding a key metric and putting necessary resources to drive that metric is a natural part of the growth of a data-driven company.  And it’s never been easier to measure performance in so many ways.

Sophisticated algorithms and multi-variate testing schemes for example, are easy to implement and can automatically determine the right business logic, process or content for a marketing initiative.  By harnessing this rich data, we can predict with increasing precision what will drive a business outcome.

But too often metrics become a proxy for motivation – what customers really want, and why.  The problem is that data tells us about a consumer’s actions, less so about their intentions and how they perceive your brand.

Blinded by The Light…of Success

Large, successful organizations can get complacent, taking for granted why a consumer chooses their brand: “We’ve got the best selection,” or “we’re the fastest and easiest to use,” or “we’ve got the most rewarding loyalty program.”  That value proposition is reinforced, refined and optimized over and over again, in a virtuous circle – with good reason.

Such a singular focus though, can lead to strategic myopia.  It makes an enterprise increasingly vulnerable to disruption, where a new entrant seemingly comes out of nowhere to become a market leader.  Think airbnb, the largest accommodation provider in the world that didn’t even exist before 2008.

This is not a new problem – it’s well-documented in books like the seminal The Innovator’s Dilemma. It’s also partly explains why large players rely upon acquisitions to scale.  Their operations and entire business model has been optimized for that singular core focus, so much so that to capture a new market demand it can’t pivot quickly enough.  In addition, with huge user bases accustomed to a certain customer experience, any change must be incremental since alienating even a small percentage of customers can significantly damage the bottom line.

Sure, they may have the resources to bring a competitive product to market quickly enough to stave off new competitors but it’s not in their DNA.  Because it’s more than the product. Just looks at Google Plus, or their soon to be shuttered Trips app.

Give The People What They Want

There are plenty of good products that never get noticed, or gain any traction.   Often it’s due to not being truly customer-centric, not understanding the value proposition.  What the consumer actually wants.

At the startup Site59, where I was part of the founding team 20 years ago, we thought we had the hottest product out there – enabling consumers to travel, go out or buy things at the last minute, at unbelievably low prices.  We featured all the hippest places, and launched (like many ventures) to the sound of crickets. No traction. No Sales. No bueno.

After conducting some interviews and surveys, we learned what travelers actually want.  They didn’t care about being at the hippest restaurant (alas, we were 20 years too early, before people took photos of their food).  They wanted to go on beach getaways and to…gulp…theme parks. Neither of these would have been a surprise to travel veterans.  But to a group of downtown NYC pre-Brooklyn 30-somethings, it was a shocker.  We were focused on and optimizing for what we thought was our core mission of spontaneous getaways and experiences.  Fortunately, we were humble enough to pivot.  Sales ramped up and within 18 months we were acquired by Travelocity.

Creating a Lean, Mean Customer-Centric Machine

This is why Lean Startup principles have gained in popularity over the past 10 years – with startups (including ours, TripTuner) as well as large corporations.  It demands that you build only what is necessary to understand if it will satisfy a real demand, measure how well it does so and then learn what you ought to have built in the first place.  It’s true user-centricity.

Mark Zuckerberg once famously asked “what is design?” But to be truly user-centric, you have to think more like a marketer than a product engineer.  Design is where ideas meet reality.

At Amazon, they don’t even think about creating a new product without first thinking of what the press release would say.  How would it be described, what problem would it solve and would it be enough to make consumers care to read about it? Entries are ruthlessly weeded out at the ideation stage by the most important criteria: would it move the needle from a consumer’s perspective?

Breaking Out of The Optimization Loop

Often larger enterprises have been optimizing so long on their core, they may miss out on the “why” part of customer behavior or disruptive new approaches.  So as a hedge, they acquire.

Acquisitions are not the only way large organizations are staving off disruption.  Many companies now have their own innovation labs, or venture arms that regularly identify, mentor and even invest in promising startups.  Another way is to partner with select technology providers that innovate outside of but are complementary to, the core business.

That’s how the major players do it.  For the rest of us, regular live user testing is one easy way to start.  You can get feedback on a new product from live users within hours.  It’s the most humbling, painful and clearest mirror one can hold up to a product.  Consumer sentiment quickly becomes very clear.  Putting up a test landing page with a modest campaign to gauge demand is yet another way.  Similar to Amazon’s press release test, you can create the copy for a proposed innovation to gauge how viable it will be, before writing even one line of code.

Both methods point to the right direction, with minimal effort and cost.  Measuring consumer sentiment – both quantitatively and qualitatively – is the right kind of optimization.  It’s also a great first step on the path to being truly customer-centric.

For Real Tho’: How Travel Marketers Think about #FOMO

At the Digital Travel Summit 2019 in Palm Springs, I had the opportunity to host a roundtable on the use of #FOMO (Fear Of Missing Out) in travel marketing.

FOMO is not new, of course.  It’s been a key ingredient in marketing campaigns since the dawn of Madison Avenue.  What’s changed is that social media’s pervasiveness has made FOMO a near-constant state of mind: an always-on reminder of what fabulous lives others (appear to) lead.

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Shout out to Tim Trad for the FOMO- and fear-inducing image of Chicago’s Willis Tower Skydeck.

We know social media feeds aren’t a completely accurate picture of reality, but they do get our attention, elicit strong emotions…and plenty of FOMO.  According to Venngage, some 61% of young adults (aged 18-35) say that social media magnifies the FOMO they already have.

FOMO can be a strong driver of travel inspiration – I mean, who hasn’t enviously ogled photos of friends in amazing places?  So to start our session I used a quick 10-question survey to get an idea of how travel marketers themselves felt about it.

SURVEY SAYS!

Usually, I’ve found that surveys often tell us more about what respondents want us to think, rather than what they actually do.  So we could expect people will underestimate their own FOMO.  That seemed to be the case: on a scale of 0 (none) to 3 (extreme), our group of travel marketers came in at a 1 – minor FOMO.  Only 9% of respondents had major FOMO (a 2).  Nobody had extreme FOMO (phew).

Digging deeper into the results, we see social media’s FOMO power – especially when it comes to our friends.  45% of respondents indicated they were concerned about a FOMO-related scenario “all the time.”  The 4 questions that elicited the strongest indicator of FOMO were:

  • I sometimes wonder if I’m spending too much time keeping up with what is going on.
  • When I miss out on a planned get-together, it bothers me.
  • It bothers me when I miss an opportunity to meet up with friends.
  • When I’m having a good time it’s important for me to share the details online (e.g. via Facebook or Instagram)

NO MO’ FOMO?

Assured (somewhat) that our esteemed panel of travel marketers were not biased towards FOMO, we delved into the main question (to be explored more in a future post): can FOMO’s shiny marketing tactics coexist with a travel brand’s quest to keep it real and connect authentically with the largest consumer demographic, millennials?

It’s an interesting question because influencer marketing often asks consumers to be inspired by “real” images of Instagram models living curated lives against a constructed backdrop of branding, made to not look like branding.  It’s not authentic, and is arguably unethical – as seen with the Fyre Festival debacle (BTW, so happy that sweet lady got her money back).

I asked our panel of experts if they felt any tension or conflict between the need to show more authentic imagery and the need to create FOMO with swoon-worthy photos, at scale?

5 TAKEAWAYS: WHAT THE EXPERTS SAID

1.”Of course” FOMO plays a role, such as when travelers announce/post that they’ve “arrived” (both physically and metaphorically, I suppose).

2. Even though FOMO was important, it isn’t necessarily an overt marketing tactic.  More consideration is generally given to whether an influencer is paid or not.

3. Authenticity is seen as a much needed counter to more polished imagery.  One destination marketer had no issue using images of buses on a tropical island, or video of a local man cutting up coconut as a way to engage today’s travelers (vs. the proverbial stunning beach shot).

4. When it comes to influencers, many favored the use of “micro-influencers” vs. the more well-known ones…another apparent nod to authenticity.

5. For hotel marketing, it definitely works in terms of limited-time offers.  One hotelier shared how the same offer performed 2X better when its availability was reduced from 10 days to 48 hours.

GOOD FOMO MOJO

Every teachable moment needs a mnemonic: to use FOMO effectively and ethically, raise a PINT!

  • Permission-based
  • Inspiration not Perspiration (positive, not fear-based).
  • Non-manipulative
  • Truthful

FO’ MO’ INFO

Are you not entertained? Enjoy these related links to delve more deeply:

Using the Fear of Missing Out Ethically for Marketers – 60 Second Marketer

What’s Being Done to Save Wild Places from Instagram – Outside Magazine

Stop Hate-Selling to Your Customers – Rafat Ali (founder, Skift)

This is Marketing book by Seth Godin

Stay tuned for more on this topic.  In the meantime, don’t you wish you were here? 🙂

What Country Has the Most Romantic Travelers? A Taste Lab Top 10 Infographic

Chances are when you put “romance”, “Russia” and “travel” in the same sentence, it’s likely to conjure visions of cold war intrigue and clandestine encounters.  In today’s politically charged environment these words can evoke stronger reactions, even flat-out controversy. But as much as we’d like to craft a clever click-baity title, amplify a viral meme or shill for a few predictable yucks, we’re not going there.  We keep it real at TripTuner, so let’s let the data tell it.

Our Taste Lab provides unique first-party data on nuanced traveler preferences collected across millions of inputs across our platform.  Last year, we shocked some by showing how South Koreans are the most relaxation-seeking travelers (not exactly what we’d associate with Gangnam style, but hey).  Now, just in time for Valentine’s Day we’re curious about which country is the most amorous when it comes to travel.  Care to guess?

TT Taste Lab Vday 2019

Well, surprise!  Our data shows that of the 10 largest outbound tourism markets, Russians are searching for more romance than family travel options.  Wait…Russia?

DA! It makes TOTAL sense. Who can forget the adorable Boris and Natasha from Rocky & Bullwinkle?  The ended-too-early “next Hamilton” Broadway play Natasha, Pierre and the Great Comet of 1812, or the longing croons of the Red Army Choir singing Daft Punk’s Get Lucky?  Not to mention the dramatic aspirational travel words of a dying Captain Vasili Borodin in the Hunt for Red October?

OK I may have violated the previous pledge about the yucks.

Rounding out the top 10 in second place is…

#2 South Korea: we’ve seen how they’re relaxation-seeking.  If you’re going to chill, might as well be with your bae, right?

#3 is France, naturellement.

#4 Germany and  

#5 Italy.  That’s amore, no surprise there.

China, the UK and Canada come in #6, #7 and #8 respectively.  And then you have the US and Australia picking up the rear, focusing more on family trips.

Overall, it’s an interesting set of results and just another taste of what our partners get with TripTuner.  What type of traveler preference data would you like to see? Leave us a comment and we’ll consider it for our next report.

Until next time, stay tuned – and as much as like data, we don’t recommend mixing metrics with romance.  It’s like a martini without a good Russian vodka. Do svidaniya, darling!

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image: dallin hassard 

Get More ROI with MOI: Moments of Inspiration

We’ve posted previously about the importance of putting the user experience first when innovating – what we call #outovating.  Putting customers first is also an imperative with marketing. Generating demand means engaging users at the precise moment when they are inspired.  It drives purchases regardless of seasonality.

The days of relying upon linear thinking in travel marketing are flying off into the sunset like the venerable 747 (we’re gonna miss that bird!).  Our always-on society means inspiration can strike anywhere, at any time. The traveler’s path from inspiration to booking is not only getting shorter – it’s disappearing.  Those who understand and capitalize on this trend will get the lion’s share of the bookings.

Today’s travelers go from inspiration to action in a flash – so they can get right to the experience. Image: Jakub Gorajek

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#Outovating: Innovating From The Outside In

Our blog mixes inspirational tales with posts on the business/tech side of travel.  Titles are usually a dead giveaway, but subjects may vary.  You’ll see both sides – that’s a good thing.

Where does innovation come from?  According to one popular theme – reinforced by TV shows like HBO’s Silicon Valley – new technologies and products come from a group of hoodie and jeans clad wunderkind techies cranking out code in a dark, dank garage.

They work tirelessly towards launch, arguing over coffee and microbrews about how to make their product hella awesome. At launch the product meets reality. Often it fails because it was developed in an internal bubble, with little regard for how it will be received by customers.

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Innovation can only thrive outside the constraints of internal structures and biases.  (Milan vertical forest image by Chris Barbalis)

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INFOGRAPHIC Traveler Tastes for 2018: To Chill or seek Thrills?

TT Taste Lab - relaxing

As 2017 winds down we’re sharing some fresh traveler preference data to help marketers target the world’s top 10 markets next year. It’s not your typical list of up-and-coming destinations (you can always find those here). Nor is it a list of popular activities or themes. Those have been covered thoroughly. Continue reading

Feeling Right at Home on a Minneapolis Business Trip

It was good to be squinting.  The rising August sun beamed off Lake Minnewashta, fragmenting into millions of diamonds around my paddle as a gentle breeze offset the rising temperature.  It’s a business trip, and I’m on a paddleboard.  Sweet, right?

Minnesota, paddleboard, SUP, lake, travel

Experiencing a place like a local resident is a desire for many travelers these days.  Lately, it’s increasingly a key ingredient for business trips as well.  Just look at airbnb’s business travel tagline: “Travel for work, feel at home.”

On a recent trip to a Minneapolis conference, I rode this trend like Paul Bunyan on Babe the Blue Ox. Here’s how I rolled (in an intentionally non-numeric list, because the world has reached listicle peak): Continue reading