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Why Frictionless Payments Matter: Booking and Pre-Trip (part 2 of 3)
By Jean-Christophe Lacour
Friday, 12th November 2021
 

The first blog in this series introduced our latest report, ‘Towards a frictionless future for travel payments’, which seeks to highlight the opportunities for travel companies that take an end-to-end approach to payments throughout the entire traveler journey.

In this three-part series of blogs we will examine how the industry can deliver a frictionless payment experience throughout each stage of the journey, beginning with booking and pre-trip.

Booking: securing the sale

The implementation of frictionless payments at the time of booking a flight can benefit both airlines and travelers by creating a compelling traveler experience, before the flight has even taken off. The payment experience when shopping can make the difference between a traveler deciding to book or selecting an alternative provider and, for this reason, it’s a critical moment.

The level of sophistication varies significantly across the airline industry and there’s currently no one-size-fits-all approach. While some airlines are making great initial steps by allowing the traveler’s card details to be held on file or alternative payment methods to be used on their website, there remains room for improvement across the board, and a great deal of untapped value to be found by solving payment pain points proactively throughout the entire trip. Personalization is one example.

Many travel companies have the traveler’s profile from prior interactions, making personalization possible, however according to recent research 64% of airlines have the same payment experience for every customer when they book. If the traveler is a frequent flyer that has previously paid with a given credit card, why not allow traveler to make that specific card the default payment option next time they visit? Simple personalization at payment removes unnecessary steps in the buying journey and helps to ensure conversion.

Today, airlines can offer travelers a wide range of payment methods from cards to bank-to-bank transfer methods. Our research with passengers suggests they value a clear and transparent presentation of the price with the option to pay in the way they prefer. Being able to combine miles, cash, or vouchers to book a single trip delivers what travelers want and with a simple ‘slider’ to choose the percentage between cash and miles, airlines can make it easy for travelers to combine different types of funds for a single booking.

Supporting people to pay with the method they want is proven to increase conversion and if it’s easier for them to spend money (whatever form it’s in) then it’s easier to justify a higher class of service or that extra ancillary service.

Pre-trip: facilitating additional purchases and managing disruption

Once the booking is secured, there is a time window we call ‘pre-trip’. This covers the period after booking and before the flight departs, during which travelers frequently decide to purchase additional services like seats, bags and meals. It’s a vital merchandising opportunity and payment options really matter.

Using ‘pay with notifications’, airlines can send a notification for check-in via app, email, SMS or chat that offers additional services like extra leg-room seats, meals, parking, car hire or insurance with the ability to pay in a single click from the notification.

Airlines could also pro-actively alert travelers when the exchange rate is favorable in advance of their trip. Foreign currency could be purchased from the airline to be spent during the trip, simplifying the FX process and securing a commission for the carrier.

Pre-trip is also about servicing. COVID-19 has highlighted the difficulty of managing large scale disruption, bringing many challenges when it came to cancellations and refunds. According to data from InFare, disruption and cancellation has now fallen from its peak of 1,200% above normal in 2020 but is still running well above 2019 levels in many regions of the world.

Digital payment innovation can help automate the disruption management process whilst improving the experience for passengers. For example, when a flight is cancelled, the traveler can be directly issued with a digital voucher. Next time the traveler makes a purchase, the voucher is displayed as one payment option amongst others to simplify the experience and encourage the next flight to be booked.

The next blog in our series will cover the payment experience at the airport, explaining how decades-old payment options can be replaced to improve the passenger experience and facilitate commerce. In the meantime, why not review our latest report for advice on making payments frictionless across the traveler’s entire trip.

Jean-Christophe Lacour, Head of Merchant Services, Payments, Amadeus

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