Data mining: Past is prologue?

The Wall Street Journal has an in-depth piece on airlines' increasing use of data-mining to up the ante on customer service. Given the low base, at least for most US airlines, providing better customer service by leveraging technology seems like an eminently achievable goal.

However, there are more than a few doubters when it comes to using data that often digs deeply into personal aspects of consumers with some of it ending up in a goldfish bowl.  Given that airlines' efforts in the past have been less than transparent, the article is bound to set off more than a mild furore from privacy hawks. 

This effort though appears to be an attempt to wean both new customers and to retain the loyalty and increase spending amongst their present  stock of passengers. However, it is unlikely to sway many skeptics. As the WSJ notes  "some airlines, flight attendants armed with tablet computers will soon have far more data on fliers at their fingertips, including their allergies, seat preferences and whether the carrier lost both their bags last trip. Airlines' marketing pitches are also becoming more relevant, in part based on customers' online-browsing history, their likes on Facebook and their income."

An aversion to troves of data reposed in the distant confines of large corporations is also a part of the focus of an ongoing legal battle between a US government agency (the FTC) and hotel giant Wyndham Worldwide with the nub of the lawsuit being the allegation that "several information-security problems at Wyndham hotels, including wrongly configured software, weak passwords and insecure computer servers, made consumers' payment-card numbers more vulnerable to hacking. The agency said card numbers were sent to an Internet domain registered in Russia between 2008 and 2010, and that hacking led to millions of dollars in fraudulent charges." It wasn't of course the only such incident as Choice and Radisson hotels had a similar problem within the last couple of years.

While there are several merits and benefits to be derived from data mining, its votaries fail to see that past is not always prologue. Consumer preferences change at a pace that defies conventional wisdom. On the aviation front, It wasn't long ago that consumers preferred the ability to cross the pond in a straitjacket that passed off for a seat in circa 3 hours over the comfort of a nearly fully reclining seat.  While it was the high operating cost and a crash that killed the supersonic project it is unclear that it would have achieved critical mass given the near absence of comfort and health risks caused by a cramped seat and excessive radiation.

In the end front of the house employees who are trained to offer service with a smile and developing a memory for frequent guests are always likely to outperform those sporting a robotic look stemming from following the diktats of a machine.  The airlines only have to look within their premium cabins for that. Flight attendants who mechanically look at seat numbers before addressing a passenger or stowing a coat are less likely to endear themselves than someone who remembers to hand over outerwear based on whom he/she took it from.

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Vijay Dandapani

Co-founder and president of a New York based hotel company for 24 years. Grew the firm to five hotels in Manhattan and also developed a greenfield project at MacArthur airport, New York. Speaker at numerous prestigious forums including Economy Hotels World Asia, Lodging Conference, NYU, Columbia University Real Estate Roundtable, Baruch College's Zicklin School and ALIS. President and ceo of New York City Hotel Association since January 2017.

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