How Consumer Demand is Shaping the Future of Travel Payments

How Consumer Demand is Shaping the Future of Travel Payments

Eric Liebman

Global Head of Travel at Ingenico ePayments

Views 1286

How Consumer Demand is Shaping the Future of Travel Payments

22.11.2019 11:15 am

Customer centricity has always been at the heart of travel businesses. But it is essential that businesses keep pace with both technological advancements and the evolving consumer demand as innovation in the sector is rapidly transforming the customer experience.

However, one element of the customer experience that is often overlooked by travel businesses is payments. Previously, payments have been perceived as a functional necessity; however, they can play a vital role in meeting customer demands.

Imagine, for example, how Chinese travellers with a large budget but no international credit card feel when they land on a travel site that only accepts Visa, Mastercard and American Express.

It’s only in the past five years or so, thanks to some forward-thinking airlines and hotel associations like Hotel Electronic Distribution Network Association (HEDNA) and Hospitality Technology Next Generation (HTNG), that payments have crept into the strategic positioning of travel businesses. These organisations have realised the benefits of taking full advantage of innovative payment strategies.

With that said, there are still many opportunities for airlines, hospitality businesses and online travel agencies to become more customer centric by deploying holistic payment strategy. Let’s take a look at some of the payment trends arising in the travel industry and what the future holds for travel payments.

Customer centricity in travel payments

Consumer demand is continuously shaping the way that payments are made. Since travel products and services such as tickets and hotel rooms can be purchased at the click of a button, instant gratification has become the norm. Today, travellers demand things now. The days of walking into a shop, making a purchase, and walking away with goods are becoming less relevant. Businesses must now find new ways to provide instant gratification to their customers.

Furthermore, payment methods offered by businesses during these transactions must be quick and easy to use. They must be up-to-date with the latest trends and technology in the payments industry. This is because customers are quickly adopting technology that is ‘cool’ to own, meaning things like Amazon Alexa, Apple’s Siri and e-wallets, where the experience is key and payments are near-invisible.

Within travel, when a customer is paying for flights, hotel rooms and cruises (among other services) they want the payment experience to be frictionless, with the added option to pay using their preferred payment method. Businesses must understand unique needs of different customers when it comes to their payment preferences, in order to generate a loyal customer base and increase conversions. There is no vanilla in payments.

Ultimately, customers don’t want businesses dictating how they pay: it’s the other way around. That is the key consideration when developing a customer centric payments strategy.

How payments are transforming travel

Over the last 10 years, several new players have showed the world how simple and frictionless payments can be and have raised the bar for everyone. These companies are staying ahead of the game and are effectively catering to the needs of their customers.

Technology has played a vital role in this, as new innovations have led to an improved customer experience and increased revenue. Tokenisation is one example of a frictionless payment method that is making life easier for customers. Through stored tokens, customers can complete safe and secure payments without ever having to reach for their wallets/purses. Now, they can simply confirm a payment and it is complete.

What’s more, the balance between security and friction is becoming easier to manage and is reducing frustration during the checkout process for customers. For example, smart phones are now equipped with fingerprint and facial recognition technology, meaning customers can be quickly authenticated at the start of the checkout process, allowing them to book and pay for the whole journey in just a few clicks.

Travelling to the future with payments

There are endless possibilities for businesses to improve their customer experience and offer new products and services by adopting customer centric payment strategies. For example, with post-purchase engagement or gamification taking off, businesses can use this technology to boost conversions and increase customer loyalty.

In summary, businesses must continue to adopt payment strategy that meet their customers’ needs. The travel industry is changing, consumers have the power about how they want to pay, and this will continue into the future. Travel companies need to learn about the technology that is available to their customers and how their customers use it. One thing for sure, in payments the only constant is change.

For more information about how Ingenico ePayments’ TravelHub solution supports travel businesses, please visit: ingenico.com/travelhub

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