Why Tourism and Hospitality Trades Must Start Seeking the Statistical Truth

One of the personal upsides of the past 24 months has been the opportunity to update my education and take some classes to stay sharp. I have taken a class from the Darden Business School on marketing analytics, I took a class at MUMA on digital marketing and I have had the recent opportunity to study statistics, first a class at the University of Maryland and now at the G Brint Ryan College of Business as part of my MBA program.

All of these programs have had value however perhaps the greatest epiphanies for me, as someone that has been working in the business world for 25 years is the application and dare I say the wisdom that I have garnered from studying statistics. I have found these classes to be eye-opening and one of my immediate reactions has been the acknowledgment that in my beloved travel and tourism industry we often fail to apply some of the rules and hence we fail to reap the full benefits.

Some of the big mistakes, the ones I now see repeated over and over again: Expecting too much certainty.?Misunderstandings about probability.?Mistakes in thinking about causation.?Problematical choice of measure. Sample sizes that are too small to tell the whole story. Poor benchmarking - what are we comparing the data to? A lack of abstract thinking as the data is interpreted. Failures to reconcile the findings with what we observe in the actual market and many more.

However, the greatest opportunity we have with statistical analysis lies in taking action based on the findings, this is a place we continue to trip up on over and over. The findings from any statistical research are typically "directional" in nature. That means they are fluid and dynamic. These often conflict with what we might see actually happening in the market and we should not be surprised by that. But for some reason we are pushing back, we ask for more analysis and would like to see it confirmed by actual behavior. But by the time it is confirmed by consumer actions the changes will come too late to help us.

The post COVID environment is full of data and it is full of needs. The consumer environment is flexing and changing as a result of two years in isolation, two years of a weakened economy, two years of concerns about health and safety, two years of changes in entertainment and social habits. All of these things combined mean that things are different, really different. Maybe we have not fully seen those differences come to light in actions, however, they are coming.

As an industry however we continue to act as if we are just picking up where we left off. We continue to debate the future of certain parts of the business (what will happen to OTA's or Travel Agents) but we don't dig deep enough to understand the type of thinking that might be leading to those changes. I can't help wondering what it will take for us to really start looking at the data correctly and exploring wholesale change as an option. Why for example have we not conducted some seeping regression analysis to really understand the differences in behavior between 2019 and 2022?

Perhaps you have heard the adage about great hockey players knowing where the puck was going to be and not focusing on where it is? Unfortunately, at times like these, it feels like we don't even know what a puck is.

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