Editor’s Note: Following our previous CEO interview series in online travelhospitality, and destinations, Skift has launched a new series, this time focused on Chief Marketing Officers.

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To better understand the big marketing challenges facing travel brands in an age when consumers are in control, Skift’s What Keeps CMOs Up at Night will talk with the leading voices in global marketing from across all the industry’s sectors.

These interviews with leaders of hotels, airlines, tourism boards, digital players, agents, tour operators and more will explore both shared and unique challenges they are facing, where they get insights, and how they best leverage digital insights to make smarter decisions.

This is the latest interview in the series.

The Leading Hotels of the World (LHW) is a collection of 375 hotels in 75 countries that’s attempting to differentiate itself in a crowded luxury lifestyle market by focusing on technology and psychographic data to better curate the individual guest experience.

Last year, LHW contracted the MMGY Global marketing firm to survey 1,500 luxury travelers between the ages of 25 to 64 in the U.S., Germany and Japan to understand what’s driving purchasing behavior among experienced, upscale travelers.

Based on the results of that survey, LHW identified its target guest as the “Curious Traveler,” who relies on his or her own devices, and relishes that process, to explore a destination in a spontaneous way.

According to the survey, “Curious Travelers are taking almost eight leisure trips a year, and while American travelers take the least amount of vacation time compared to other markets in this study, they are the most likely to visit new destinations when they travel overseas…. The Curious Traveler has a strong sense of self. They trust their judgment as much, if not more, than the opinions of others.”

The top-line data from the survey shows:

  • 79% of Curious Travelers feel that travel is an essential part of life
  • 30% of Curious Travelers intend to take more trips in 2016 versus 12% who plan to take fewer
  • 78% express interest in exploring a destination’s hidden gems
  • 54% look for unique and different travel adventures
  • Only 32% seek the “hottest/trendiest” spots
  • The Curious Traveler will spend 7% more on hotel accommodations per night this year than they did in 2015 ($419 per night/$390 per night)

We spoke with Shannon Knapp, CMO of Leading Hotels Worldwide, to understand how this insight is directing LHW’s marketing strategy in 2016.

Skift: Last year was pivotal for LHW’s evolution as an industry leader in terms of its digital marketing delivery and consumer research. Take us back through the process.

Shannon Knapp: For LHW, 2015 was really a great year in terms of the progress that we were able to make in accelerating our knowledge and understanding of our guests and prospects. We invested significantly in building our customer insights and marketing analytics capabilities, and the exciting result is that we were able to identify the distinct segments of affluent travelers for whom the LHW collection of hotels is a great fit, based on their demand for a truly authentic and immersive experience when they travel. We’ve dubbed this group the “Curious Traveler.”

In 2015 we re-imagined the LHW brand strategy to break through with this unique group of travelers, and as a result we launched a remarkably uncommon brand campaign in early 2015. I’m proud to say that it was very successful for us. We were able to increase our brand awareness among this key demographic, and we were able to drive significant increases across key attributes that we were targeting, specifically that LHW is distinct from other luxury hotel and travel brands. That was very important for us with this group, to communicate how LHW inspires curiosity and how LHW feels authentic.

As a follow up to the relaunch of the brand and the success of the brand campaign, our next step was to field this independent study in which we wanted to delve deeper into the specific motivations and travel behaviors of this traveler with the goal to better serve them.

Skift: What were the most significant takeaways from the study?

Knapp: The Curious Traveler trend study revealed some great insights, specifically that travel is essential to their lives. It’s not what they do, it’s really who they are. Their travels are really a journey of self discovery and empowerment, and they get that through their exploration and discovery of new experiences, cultures, people, etc., when they’re traveling.

The second key thing that we found was that they’re really defined by their confident outlook. They are the trendsetters and the leaders among their peers as it relates to travel, so they don’t want to follow what others have done or are doing. It’s all about this journey of discovery for them. Some of the stats that reinforce this are that 78% of them are interested in exploring hidden gems, and only 32% of them looked to find the hottest or trendiest spots. You see it borne out in the statistics that they’re really looking to forge their own path.

The third thing that we uncovered was that they thrive on cultural immersion. This is really what sets this group apart, because they desire to experience the destination like locals. They don’t consume the destination and culture. They actually want to become a part of it.

Skift: So how can Leading Hotels immerse travelers in the local culture within any given destination?

Knapp: One of the best ways to understand a culture, I believe, is through their food and wine. The Curious Travelers are all unified in their desire for unexpected and un-ordinary culinary experiences, Around 88% of them really love to experience the culture through culinary experiences because they’re more adventurous. It’s not that they’re adventurous in terms of zip-lining or whitewater rafting, but they’re adventurous in their desire to create story-worthy moments when traveling, and they’re therefore more willing to try things they wouldn’t do when they’re at home.

Skift: Generally, that adventurous spirit applies to many aspects of travel.

Knapp: Yes, that adventurous mindset extends to their food choices, their activities, and even their willingness to explore new hotels, with 56% of them open to trying a hotel other than their favorite hotel brand when they still want to stay in a 5-star hotel while traveling. The next step for us is to leverage all of this insight that we’ve gleaned about the Curious Traveler, along with the detailed analytics and segmentation we’ve done internally, to transform the customer experience. So now we’re leading our member hotels to activate these insights and create individualized experiences throughout the journey.

Skift: What keeps you up at night in terms of leveraging all of that customer insight?

Knapp: Yeah, I love that question. There’s probably three key things that keep me up at night. The first is, of course, the empowered consumer. Obviously they have the access to information like nothing we’ve ever seen before, nothing we’ve ever experienced, and as a result, the market dynamics have shifted. The demand that they have for full transparency and immediate gratification has transformed their expectations of their interactions with friends.

I think almost more difficult is the second thing that keeps me up at night, which is the competition for this empowered consumer, especially in the digital space. The cost of acquisition, as we all know, is not just accelerating, it’s increasing at a staggering pace and it’s almost impossible for travel brands not named “Priceline” or “Expedia” to keep up.

For collection brands like Leading Hotels, we’re owned by over 60 of our independent hotels, so certainly we don’t have $3 billion to spend on search. It’s very difficult for us to keep up with the level of investment that’s being driven by the big guys in this space, so we have to change the game that we’re playing, and that’s what we’re trying to do. We’re really looking to shift our focus from this broad scale acquisition, and then try to manage the churn that you get through the broad scale acquisition. So what we’re trying to do is focus on cultivating life-long relationships with this specific group of Curious Travelers, for whom our collection is the right fit for the experiences they seek.

Skift: You just have to find them first, right, and then keep them coming back?

Knapp: Exactly. Finding these travelers, engaging with them, co-creating the story-worthy travel moments they seek — that’s really what we’re trying to do by leveraging a deep understanding of who they are, what they value, and how we can help them on their journey of discovery. So we’re going to be a lot more targeted because we have a very strong interest in engaging this guest beyond a single reservation.

Skift: And the third thing that keeps you up at night?

Knapp: The third thing that keeps me up at night is the pace of change in the world of marketing technology, specifically the collection, the analysis, and the use of data to create truly individualized experiences. It’s a constant challenge to stay up to date with all the new vendors that are popping up in this space everyday. We’re always trying to understand how one vendor’s offering differs from another, and can they integrate with our systems, with our data sources? Are they going to generate a return meaningful enough that it makes the investment worthwhile?

So, we need to know what’s the balance between specialization and complexity, especially for a company like us? It’s also about making sure that you’re keeping your employees educated on all these new capabilities and technologies, so that we’re able to maximize the investment. That, obviously, goes hand and hand with what you choose to invest in.

Skift: With so many changes in search, how are you shifting your advertising strategy?

Knapp: That’s an evolving relationship, I think, for all of us, advertising is getting smarter. I think we’ve seen this across the board. Many, many, many companies are looking to use data to make the advertising more relevant and impactful. This, obviously, includes more sophisticated dynamic advertising, more sophisticated targeting, more look-alike modeling, you name it. I think as marketers we all recognize that we, more than ever, need a more comprehensive approach to advertising. Content, of course, is critically important but it’s well beyond what we’ve always focused on with regard to organic SEO. So, we’re looking at how do we drive interest in that content through social, video, photos, etc?

Skift: Going back to the Curious Traveler theme, a ton of travel brands are positioning themselves in front of that more educated, more well-traveled customer. Even the big brands like Renaissance and Conrad, and also all of these new lifestyle flags. It feels like we’re hearing the same thing over and over and over again. So how are you going to develop content, marketing, advertising, social media, etc., to cut through the noise to reach your Curious Traveler in a fresh way?

Knapp: Yeah, absolutely. I think there’s probably two things that our specific insight does for us. The first is it’s on us to make sure that we are finding, and creating, and cultivating online content for the Curious Traveler that is relevant to how they wish to travel, and how they wish to explore. So they’re not going to be taking an itinerary off our site and just doing it. They really embrace and enjoy the process of planning their travel, because that’s part of the journey for them. We will be simply a source of information for them. Part of our goal is to certainly inspire their search, but taking a prefab itinerary from a company website is not going to make them happy. That’s one of the considerations as we think about the type of content we curate.

I think the second point of this is on the hotel side. How do we make sure that our hotels are also delivering the surprise, the secret insight in the destination? We feel like our hotels and our hotel concierges are uniquely positioned to do so. Many of those employees at the hotels have lived in those destinations their entire lives for many generations, and they really, truly know what is distinct and unique about their destination. We need to tap into that resource. Remember, over 80% of our hotels are family owned or family operated, so there’s a real sense of multi-generational insight and a depth of understanding of the culture that our hotels are in. We think that’s a great advantage for us.

Skift: What’s your social media and messaging strategy in 2016 that can take advantage of that adventage?

Knapp: Obviously because we’re moving away from the broad scale customer acquisition approach, we’ve been watching social media targeting and analytics tool advancements very closely. With players like Facebook and now Pinterest, which just added nearly 400 targeting options, we look at how they’re rolling out enhancements in these areas, and how that provides us with the opportunity to target our specific Curious Traveler in a more meaningful way. We have seen success in driving higher engagement and traffic when we’re not only extremely targeted, but we’re also serving contextually relevant content that targets them in the right format, whether it’s photos or videos.

We’ve actually seen triple digit growth in traffic and double digit growth in engagement on some of the more visual platforms such as Instagram and Facebook. We also look at the type of content that these platforms are favoring in their roll-outs, such as Facebook Livestream and video content in general. We’ve been increasing the amount of video content, and we’re seeing a three times higher performance and engagement rate than other mediums.

Skift: Why did Leading Hotels decide to integrate IBM Watson’s cognitive search capabilities into the website?

Knapp: We’re making a lot of investments and advancements in LHW.com to provide even more tailored and personalized recommendations for our travelers. There are two key examples of how we’re doing this. The first is that we’re integrating predictive intelligence capabilities on LHW.com to deliver individualized recommendations to visitors based on their profiles. The intent here is to significantly increase the relevance of their experience.

The second thing is our exciting new collaboration with WayBlazer to integrate the IBM Watson travel tool. Visitors to our site can now leverage the technology’s natural language processing capabilities to dynamically get recommendations based on their search criteria through the tool. The tool will deliver hotel results that are displayed in order of relevance with dynamic images bringing to life the travelers search criteria. If they searched for something related to golf, the images will dynamically shift to show them a golf course or somebody golfing to try and increase that relevance.

Skift: Okay, this is cool. So the idea here with LHW’s online Discovery Tool is that Watson understands semantic queries, versus just search keywords like Google?

Knapp: Right, exactly, although keep in mind this is still a beta, and it’s the very first launch for WayBlazer in this way. The beauty of the IBM Watson technology is that it continues to learn. The more that it’s used, the smarter the brain gets, and the better the recommendations get.

Skift: What would be an example of a query?

Knapp: Something like: “Where are the best hotels in the Caribbean for my honeymoon in June?” Watson brings in several different sources, including social sources, across the entire product catalog. The IBM Watson secret sauce is its natural language processing capability to integrate a lot of sources to create relevant recommendations based on many, many attributes and variables in a way that Google search could never do.

In the future, that’s how we would like to evolve the product to be able to expand beyond just hotel recommendations. So far, it’s proven to be very strong. Before launching it in full beta on our site, we sent it out to a few of our Leaders Club members for them to kick the tires a little bit, and we got a lot of great feedback from them. They feel it’s a helpful inspiration tool. There was one comment, “I feel like I’m working on something in the future.” So we think it’s going to really help with site engagement, expanding beyond just the transaction, to help people earlier in their journey to find new sources of inspiration for their specific travel goals.

Skift: If your marketing budget was doubled, how would you invest those funds?

Knapp: I would invest in the technology capabilities that we need to create truly individualized, very relevant customer experiences for our Curious Travelers.

This series is presented by Boxever. The Skift content team maintains complete editorial control over these interviews and the selection of subjects.

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Photo Credit: Shannon Knapp, CMO of Leading Hotels Worldwide. LHW