Technology / Big data makes online shopping personal for millennials

Big data makes online shopping personal for millennials

The millennial generation is fairly accepting of being targeted with personalised ads online. Research by Expedia and the Future Foundation has showed that 77 per cent of them see value in sharing their personal data.

“Millennials have grown up in an era where the whole ad industry has been predicated on sharing data, so they are more familiar with how online advertising works than prior generations,” Gary Morrison, SVP, head of retail at Expedia, tells me at the Millennial 20/20 Summit in London.

According to Morrison, millennials have an expectation that if they are interacting with a website then recommendations are going to be made to them based on their data.

The research by Expedia and the Future Foundation showed this was true in nearly all countries around the world except South Korea. The percentage of millennials willing to share personal data in exchange for recommendations was highest in China, at 80 per cent, followed by Brazil at 65 per cent and then the US at 60 per cent, while the UK was only 44 per cent.

Says Morrison: “Data can improve the relevancy of the information displayed. The more a company can learn about a person’s preferences, budget, party size, what they are interested in, and so on, the more they can provide that person with the most relevant recommendations on the first page of results.”

At Expedia, there are more than 7.5 billion searches a year and numbers are crunched through machine learning. The data helps them understand what different groups of people are looking for and allows them to target people that have similar interests accordingly.

It allows Expedia to orientate content towards people depending on how they are interacting with the online travel firm on their website or through emails. For example, if Expedia sees a person engaging with a type of content on their website, such as beach hotels, it would target them with more beach-orientated ads.

Morrison tells me that as long as companies act responsibly in how they use data, and use it in a way that can inform and improve recommendations, then people are more comfortable with it. But he is also quick to point out that it is vital to ensure data is not used in a “creepy” way.

He says: “We want our use of data to be relevant, but we do not want it to be so relevant that it tends to be somewhat creepy.

“In using customer data, obviously you need to comply with all the relevant laws and regulations. There is a sense of acting responsibly. Most of us are able to understand what represents good marketing.”

Expedia’s data is also generated through surveying customers on their trip to see if what they booked meets their standards, and is used to improve the customer experience. Through analysing this in real time, Expedia can quickly work out what customers like and do not like and thus shield them from experiences which do not meet their expectations.

Sarah Gavin, global head of Communication at Expedia, tells me: “The number one detractor is a bad hotel experience – if people have a bad hotel experience they are much less likely to be loyal to Expedia.

“If we can find you the right hotel that matches the occasion you are travelling for, it is much more likely to be a positive experience and you are much more likely to be a long-term Expedia customer.”

The data harvested from customers is mined to look for what Expedia calls “customer pain points”. If there are frequent comments about hotels which are less than optimal, Morrison explains, the hotel is made aware of these and a process is put in place to iron out these pain points.

He says: “We are trying to find what we call an effortless experience. That is the overall site experience – when you come to Expedia we want it to be as seamless and easy as possible.”

According to Morrison, this use of data will only continue – and he sees customers’ mobile devices becoming the centre of this retail revolution.

“Millennials almost want to live the experience before they have the experience for multiple reasons,” he says. “Mobile phones will become the bedrock of how you experience travel, all the way from checking in to flights to [airport] terminal maps. I would expect that at some point too, whatever films you have on your mobile phone, you will place them into some sort of cassette and be able to watch that on the airline. Recommendations will become more personalised about local experiences based on what others like you have already done.”