Why CDPs and Data Warehouses Are Crucial to the Success of Travel Suppliers

Travel suppliers are at a crossroads, striving to reclaim revenue and strengthen their share in the direct-to-consumer market (D2C) amidst competition with Online Travel Agencies (OTAs). As customer expectations grow and digital touchpoints proliferate, delivering personalized experiences has become both an opportunity and a challenge for companies, where direct bookings can be twice as profitable as those through OTAs, due to high commission fees. The shift from transactional interactions to managing the entire customer lifecycle—from inspiration to purchase—has created a demand for curated, end-to-end experiences. The problem is that many travel suppliers are held back by fragmented data systems and legacy infrastructures, which makes it difficult to scale the management of the customer lifecycle and experience while delivering heightened personalization.

This is where the pairing of Customer Data Platforms (CDPs) and data warehouses comes into play. 

CDPs and data warehouses serve complementary roles in managing and leveraging data. While data warehouses excel in storing and analyzing large volumes of historical data for long-term strategies, CDPs provide real-time customer insights–offering the ability to unify first-party data across all channels. Combined, they create a synergistic loop where CDPs feed actionable data to warehouses, and insights from warehouses refine customer engagement strategies. With the foundation of structured, high-quality data, brands can leverage AI to personalize interactions, anticipate customer needs, and improve the overall travel experience. Despite these advantages, CDPs paired with data warehouses are underutilized. And to stay competitive in the travel and hospitality sector, this is no longer optional to have—it’s an essential component for operational efficiency and the modern customer experience.

The Problem: Data Silos and Fragmentation

From our team’s recent attendance at the Phocuswright Conference 2024 held in Phoenix, Arizona, one major theme stood out: data fragmentation continues to hinder innovation. Travel suppliers are collecting more data than ever before, but much of it remains trapped in silos that limit their ability to deliver tailored experiences and increase revenue. The disconnect between data sources, from reservations to customer support, creates friction and prevents companies from fully understanding their customers.

At the same time, younger travelers expect these brands to engage with them in ways that feel intuitive and relevant. Loyalty programs and cookie-cutter marketing campaigns fail to resonate with this audience, requiring a redefinition of loyalty through data-driven personalization.

Phocuswright also highlighted how AI is transforming the travel sector. Concepts like AI user agents and company agents negotiating on behalf of customers and businesses point to a future where data-driven decision-making is essential. These advanced AI systems require a robust foundation powered by a CDP and data warehouse to work properly. Without this infrastructure, travel suppliers risk falling behind more agile competitors, and continued reliance on OTAs, that have already adopted data-first approaches.

Building a Strong Data Foundation

While the concept of a CDP has been around for years, many travel brands struggle to distinguish a true CDP from other data management tools, and understand the importance of the data warehouse pairing. 

This combination provides optimal value, which includes both personalization at scale and the operational efficiency that AI can provide. Structured sources of truth related to content, operational and product data, and customers enable advanced insights that fuel AI-driven personalization and enhance the guest journey. However, many brands hesitate to adopt these tools due to perceived complexity or lack of readiness in their existing data infrastructure. But as Phocuswright sessions highlighted, innovation in this space is becoming more accessible. Lean, outcome-oriented strategies are enabling even smaller travel brands to integrate these technologies without completely overhauling their workflows.

To succeed, these platforms must integrate seamlessly with existing systems like reservation platforms, CRMs, and digital asset management tools. Together, they create the infrastructure necessary for advanced personalization. Travel suppliers with mature content and data strategies will find implementation easier, while others may need to invest in foundational improvements to unlock the full potential of their data.

Consider one of our clients, a leading expedition cruise company as an example. By implementing Twilio Segment as their CDP, they unified first-party data across channels, leading to improvements in personalized marketing, automated email campaigns, and customer support. This not only streamlined operations but also enhanced the customer experience, leading to a 20% rise in repeat bookings and showing how a well-implemented CDP and data warehouse can drive tangible results.

The Opportunity: Scaling Personalization with CDPs and Data Warehouses

As highlighted at Phocuswright, personalization at scale is no longer a luxury—it’s a necessity. Younger travelers are shifting away from traditional discovery methods like “Googling” toward conversational AI interfaces. This new behavior underscores the importance of meeting customers where they are, with tailored experiences that feel organic and seamless.

AI solutions depend on high-quality, unified data, which CDPs and data warehouses are uniquely positioned to provide. Travel suppliers that embrace CDPs can go beyond collecting data to actively using it to anticipate guest needs, create personalized marketing campaigns, and drive long-term loyalty.

The insights from Phocuswright are clear: innovation in the travel industry depends on a strong data foundation. The combination of CDPs and data warehouses offers a pathway for travel suppliers to scale personalization, reclaim their data, and redefine how they engage with travelers. As the competition heats up and guest expectations continue to rise, investing in these tools is not just a strategic choice—it’s a survival tactic.

For companies ready to embrace the future, a CDP and data warehouse can unlock the potential of AI, streamline operations, and enhance every step of the customer journey. In a world where “skating to where the puck is going” is the mantra, these technologies ensure travel suppliers are always one step ahead.