Customer Retention Rate: Growing the Right metrics in Travel and Tourism

customer retention travel

Travel companies don’t have the same customer lifecycle as others. Customers may look around and move to a final stage of inquiry and decide not to use a service, customers’ demand peaks at certain peak seasons, the frequency between booked trips may be often be very long, feedback on these trips are essential for growth and the competition to give customers a good deal is always fierce. Yet, it is possible for a travel and tourism company to boost customer retention rate by following best practices and innovating at the right time. Here’s a few ways to start.

Deals Deals Deals

Everyone wants to get the best travel deals, even by spending very little time and money. For customers who have already travelled with you once, reach out to offer them the first dibs on your special deals and packages for popular festive seasons or offer them the option of joining your referral program.

airbnbImage: AirBnB

The idea of exclusive access to great deals makes a customer feel special and also gives you a way to engage your repeat customers and grow customer retention rate. A recommendation platform can help you find the best rates across travel options and set your prices based on industry standards.

Two Way Communication

Let customers reach out to you at any point during their conversion lifecycle, be it to offer feedback on a trip or to discuss their plans for holidays. An in-app messenger can be a great way to open up two way communication with customers.

two way comm
Image: PSFK

Messengers help your brand increase customer retention rate by letting you respond to customers on the go and make interventions immediately to improve their holidays. Incorporating a feedback channel into your in-app messenger and getting customer feedback on their booking experience is a valuable metric to keep in mind for customer retention.

Affiliate Marketing with Loyalty Programs

Loyalty programs and affiliate marketing are all about making your repeat customers feel like special while they travel. Customers need to get advantages during their travel experiences that others don’t, and see pain points addressed creatively.

customer retention rates offer

Tying up with companies that offer airport lounge services like Priority Pass or Lounge Pass to offer your guests special airport privileges while they wait is one example that can go far to improve your customer retention rate. Who wouldn’t be excited to post selfies from the exclusive insides of the airport’s VIP lounge? Websites like, (owned by Expedia) give users one night free for every ten booked.


Look to book vs Revenue per Search

The traditional way to measure conversions for online travel companies is the look-to-book ratio. While this is a great metric to focus on, it remains cost-centric rather than revenue and retention centric. When you market across channels, factors like page drop offs and internet errors get counted in your look-to-book ratio making it not the most reliable.

revenue per searchImage: Trinomics

On the other hand, measuring the revenue per search (after conversions) across every channel gives you a better insight into the channels/agents that are working well for you. To grow customer retention rates, understand who is loading systems with high request volumes but delivering few bookings, and who is delivering high-value bookings with a few searches before you optimize that channel or agent.

Mobile Responsiveness 

You know that time when you were sitting at work and your friend told you they booked tickets to a music festival where your favorite artists are playing? I do. And you know what I did next? Picked up my phone to check on ticket prices and plotted how I could get the time off from work.

For customers like me, the mobile experience is an essential factor to decide if I want to book with a particular travel company or not. Analytics on your app on stalled bookings and drop offs from enquiries will help you understand and optimize your conversion cycle bette and offer better experiences to increase customer retention rate.

Popular Destinations and Current Events

Norwegian Airlines made waves in September 2016 with their epic ad, tempting anyone who wanted to visit Los Angeles with the headline ‘Brad is Single’ This was a great way to make use of a current event – the split of one of Hollywood’s most popular couples – to create a funny and unique marketing pitch.


When the Greek economy took a downturn in 2011, travellers got a bonus with cheaper travel rates and less crowds at destinations. Your customer retention rate is a direct result of how effectively you keep tabs on current events and trending destinations and pitch them right to customers who have built a trust and rapport with you. You can also recommend personalized destinations and information for your customers in your newsletters or updates to subscribers.



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