Incorporating travel insurance into the booking path can offer a deeper understanding of each individual journey. This gives brands the opportunity to create more personalized approaches, potentially unlocking loyalty from a much broader range of customers.
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The changing travel landscape demands a new definition of customer loyalty. Brands that reframe their priorities around personalizing customer interactions have an unprecedented opportunity to become pioneers in providing a connected experience across the entire travel journey.
This article explores how travel insurance provides unique insights into customer behaviors, and by using traveler data associated with insurance purchases, service calls, and claims, brands can unlock the ability to provide personalized experiences that expand their range of customer satisfaction and earn deeper, longer-lasting loyalty.
To learn more about how brands can incorporate travel insurance as a linchpin in the connected customer trip, download the latest trend report from Skift and Allianz Partners.
A Generational Shift in Traveler Loyalty
In part due to post-traumatic stress from the Covid-19 pandemic, coupled with the unpredictability that has beset the travel experience over the past several years, a majority of travelers have become attuned to the importance of considering travel insurance products.
According to a June 2023 report by Bank of America, nearly three-quarters of travelers said they’re willing to pay to add travel insurance or refundable booking options for their trips. Among those, Gen Z and millennial travelers were much more likely to be in this camp in comparison to other generations — 87 percent and 83 percent, respectively.
Alongside a more cautious approach to protecting themselves against the unexpected, younger travelers’ views about brand loyalty are changing as well.
As an illustration, according to a Morning Consult study, just 46 percent of Gen Z travelers were “absolutely certain” or “very likely” to purchase from hotel brands in whose loyalty programs they were already enrolled. And 33 percent said that they don’t trust these brands at all — even though they’re part of that loyalty program.
These statistics show that not every traveler has the ability or interest in maximizing loyalty points, especially if they travel infrequently. Or, they may prefer a certain brand, or live in a hub city, and as a loyal customer in the literal sense — even if their status doesn’t reflect it — they also want to feel cared for and treated well.
“While points do matter, and they are a great way to build loyalty, they are not the only way,” noted Emily Hartman, chief of business teams, USA, Allianz Partners. “The more that companies communicate who they are, how they touch customers, how they work with customers, and the services they provide, [the more they can make] loyalty go well beyond the points they offer.”
Personalization With Purpose
While loyalty programs reflect how travelers interact with brands in the big picture, ultimately, the joy of traveling is about being in the moment.
“No one is happy when things don’t go as planned, and especially in those moments, customers aren’t thinking about anything but the issue they are encountering and its importance to them,” said Chris Garlock, vice president of marketing strategy at Allianz Partners.
When it comes to protecting their trip, consumers value purpose, not just coverage for losses, wrote Bain & Company in its recent report, Customer Behavior and Loyalty in Insurance: Global Edition 2023. The authors noted a substantial “shift from loss coverage to risk prevention, from functional product excellence to serving customers on more emotional and social needs, and from pushing out offerings with a pitch to pulling in customers by addressing their priorities at the right moments.”
The ability to personalize against these priorities is not only about the traveler, but also the context of the trip. People make dozens of choices all within a few clicks before booking — destination, number of rooms, number of guests, number of adults and children, booking dates, booking days of week, booking time of day, travel dates, booking windows, trip lengths, trip costs, loyalty statuses, hotel brand tier, and more.
Travel insurance provides context clues for personalization in a way that can’t be gleaned solely from booking data or even loyalty profile data, because customers are protecting their entire trip, not just one piece of it. That’s how Allianz Partners has been able to utilize more than 287 billion traveler data points to curate a timely and applicable offer that suits someone traveling for a specific purpose in a specific moment.
“During booking, each piece of data is a valuable insight into creating and understanding customer cohorts,” said Garlock. “Within each cohort, we curate offers not only based on the products to be offered, but ensuring the offer has the most relevant messaging and design to drive product understanding, customer experience, and business growth.”
This should be liberating news for travel companies, since loyalty data sets don’t always provide the complete picture. In fact, according to a 2022 survey from Skift and Amperity, less than 25 percent of travel marketers were confident that they had the information they needed to serve people who have already raised their hand as a loyal customer.
If you think about it, it makes sense. Consider champion road warriors who hold hotel brand loyalty profiles. Their preferences when planning a trip with family may look a lot different from weekly business trips over the course of 20 years.
To that end, knowing more about who is traveling in a particular instance indicates a lot about what that customer values. For instance, seeing that a booking inclusive of multiple adults may indicate family travel, which could lend itself to messaging highlighting the benefits that could help in the event of illness or injury or protection for a larger number of bags or personal belongings that may be lost, stolen, damaged, or delayed, Garlock added.
While Allianz Partners has hundreds of different product solutions, a prospective customer will likely see just one offer that includes the coverage they are most likely to need. The more customers feel like a brand knows them, the more likely they will be to come back.
“The combination of a robust product portfolio, strong partnerships, leading distribution technology, and experience come together to provide something truly personalized. In the context of a customer, they may not even realize travel insurance has been personalized for them — and that’s an ok thing,” said Garlock. “It’s not just about selling, but providing the service guests deserve and helping to solve problems.”
For additional insights on this topic and more, download the latest trend report from Skift and Allianz Partners.
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