Data Mining In Tourism

& Hospitality
 Everyday, millions of people travel around the
globe for business, vacations, sightseeing, or
other reasons. A large amount of money is spent
on tickets, accommodations, food,
transportation, and entertainment.
The travel industry is a provider of
experiences, and increasingly these experiences
need to be customized.
 According to World Travel and Tourism Council, travel and
tourism represents approximately 11% of the worldwide gross
domestic product (GDP).
Benefits of Tourism
• Tourism brings in large amounts of income into a
local economy in the form of payment for goods and
services needed by tourists.
• Accounts for 30% of the world's trade of services,
and 6% of overall exports of goods and services. 
• Creates opportunities for employment in the service
sector of the economy associated with tourism.

• Betterment of Transportation services, hospitality

services and entertainment venues.
Application Of Data
Mining
In Tourism
• Tourism companies can accumulate large amounts of
customer data which can be organized in databases, which is
used to guide market decision.

• For identification of important relationships located in these

consumers, it can be attempted to raise the power of
information by using data mining technologies.

• With the help of the data mining software the company can
find two major groups of customers: on one hand the
primarily price driven customers who are relatively flexible
regarding their travel destination; and on the other those
customers who know where they want to go and who would
simply look for the cheapest offer.
• The data mining software can analyze the historic web
analytics data, allowing to differentiate the customer clusters
by their actions and click behavior.

• This in turn enables the tourism portal provider to offer a

customized design and content of the homepage already after
the first moves of a customer. In this way the company can
provide the users of the portal with exactly those services
they are looking for.

• Data mining techniques such as association rules, clustering,

decision trees etc. have been widely used for successfully
segmenting and targeting customers across various industries.
 Descriptive Modelling
• Profiling of data sets in order to understand
their characteristics, similarities and
differences.
• Standard description tools include
summary statistics such as measures of
central tendency, measures of dispersion and
counts.
• Graphical approaches can also help to
describe data and the relationship in data.
 Prescriptive Modelling
• Multiple regressions can be used to
predict the amount of tourist expenditure
based on income, age and gender.
• The end product can be graphically
represented by a tree like structure, which
is a compact explanation of the data.
Data Mining Process
Drawbacks of Data
Mining In Tourism
Industry
 Privacy Issue
• The concerns about the personal privacy have
been increasing enormously recently especially
when the internet is booming with social
networks, e-commerce, forums, blogs, etc.
• Because of privacy issues, people are afraid of
their personal information is collected and used
in an unethical way that potentially causing them
a lot of troubles.
 Security Issue
• Businesses own information about their
employees and customers including bank
account number, birthday, payroll and etc.
However how properly this information is taken
care is still in questions.
• There have been a lot of cases that hackers
accessed and stole big data of customers from
the big corporations.
 Misuse of Information
• Information is collected through data mining
intended for the ethical purposes can be misused.
• This information may be exploited by unethical
people or businesses to take benefits of vulnerable
people or discriminate against a group of people.
In addition, data mining technique is not perfectly
accurate.
• Therefore, if inaccurate information is used for
decision-making, it will cause serious consequence.
 Conclusion
Data Mining provides an effective approach to discover
and understand patterns in customer behavior thereby
helping the decision maker to better group customers. In
addition, travel agencies can adopt the application of data
mining in Internet-based scenario for implementing their
strategies, which in turn sustain their competitiveness in
current business environment and establish successful
relationship with customers.