A little while ago, we got some travel and payment experts from across the industry in to talk about the challenges and opportunities involved in the upcoming years.
With the fast-approaching launch of our new ebook (Future Strategies: Five Focus Areas for every Forward-Facing Business – look out for it soon!), we thought it’d be a great time to look back and pick out some of our favourite learnings from the series.
If you enjoy, you can catch up with the entire series in our online videos.
Following your customers, not leading them
We talked to Andrea Caulfield-Smith, Director Partnership Development and Management, B2B Travel, Visa – she has an amazing level of experience, and we loved her simple description of the different needs of business and leisure travellers.
“I think of business travellers as ‘time optimisers’ – because time is money, and they want to get through the airport quickly, everything needs to be contactless, quick, easy and seamless. Leisure customers are ‘space maximisers’ – they’re on holiday, they’re relaxed, and they want that holiday experience. They want to enjoy as much of it as possible. They’re looking for quick, easy and a high level of acceptance – that’s really important. What’s critical is that the suite of products is accepted, so they don’t have to worry about the acceptance or protection of their money.”
It's a useful reminder (and a theme that came up a lot) that you have to concentrate on what passengers want and need. It’s an area that Shaun Morton, CFO at On The Beach also reflected.
“Don’t be limited by your own business model – the most successful companies will be the ones that follow the customer, not lead them. You need to make sure decisions are customer-led, customer-first. Not constrained by what you think is best for your business model or what you think they should do.”
(Hyper) personalisation is a big talking point
If there was one topic that kept turning up, it was personalisation (and hyper-personalisation). This is all about seeing the customer throughout their entire journey – adding in things like taxis and theatre tickets, down to the small details.
Jesus M Faubel, Distribution Strategy and Alliance Manager at Vueling, talked at length about personalisation and how Vueling are approaching it. “Getting to know the customer is going to be key, in coming years, to really achieve personalisation. For example, being able to predict the disruptions, cancellations caused by changes to bookings, and seamlessly changing the added-on personalisation elements (like hotels, cars, etc) is also personalising the offer (in one app).”
Andrea agreed, and pointed out the element of comfort it can bring customers. “Hyper-personalisation is allowing the customer to book as much as they can at the point of reservation – encouraging them to buy theatre tickets or taxi tickets. The more we can enable this, the better, as it removed concern once they’re traveling, as they know things are booked.”
Jesus also pointed out some of the challenges involved: “The pitfall of personalisation – the regulation of the data. We’re all thinking about what we can do with the data, but who is going to be the owner of the data, and what will the regulations be like? Will customers give their info for free? Will we need to pay for it? There are risks there around regulations and policies.”
Rebuilding trust and transparency
While the last few years have seen a lot of customer goodwill around vouchers and refunds, there have clearly been complications. The pandemic revealed some old-fashioned approaches in the industry, and almost everyone wondered how sustainable this is.
Dave Robinson, COO and Deputy CEO at Pax2Pay also talked about need for change, particularly around refunds and how transparent companies are. “Learning from things that happened – maybe around how they run their businesses, particularly around protecting customers – where we don’t get into a position where the tour operator has a relationship with the customer, but also a relationship with the airline and don’t want to lose their money. People need to talk to each other and find out if there’s a better way of doing this.”
Agustin Fiori, former European Sales Director at Modulr also recounted how important this was. “Companies need to be really transparent, and make sure that – at all times – customers know where their money is and what’s happening. If the infrastructure changes, then refunds can happen practically instantly, rather than making people wait for a long period of time.”
Shaun Morton agreed, talking about how customers had been very forgiving during the pandemic era. “Vouchers are a thing of the past – We got help during the pandemic and the customers were forgiving. It’s the right thing for the industry to rebuild trust by getting better and quicker at refunds.”
Building new payment options
Andrea pointed out that “Customers are going to demand a suite of products, not just one payment mechanism. The de facto was always credit cards, but now, it’s credit cards, debit cards, virtual solutions, digital wallets and a whole host of other things in-between.”
Shaun Morton talked about how cards were still “most helpful, and being protected by the same rights as consumers is good,” but then clarified “The future will probably involve more options. No one size fits all”.
Jesus was enthusiastic about the opportunities, particularly in years to come. “The new technologies bring in an opportunity to experiment and combine different things – new things like blockchain, metverse, NFTs – these things will have a much higher impact on how we’re going to deploy new platforms.”
Dave Robinson agreed, pointing out the use of API (“The biggest development in virtual cards is around the API – OTAs and tour operators can reach out using a very sophisticated API. It allows the customer to do more than just book flights.”), but also the sophisticated machine learnings that AI can bring: “Speed is key. We’re seeing thousands of transactions per minute or second. And we use AI to help customers by predicting when their spend money will go up or down… Trying to predict spend patterns for cash management purposes to let customers know when they need to top up their accounts , for example. And also to predict where people will want to go and when. It’s all about predicting these things months ahead.”
Paul Van Alfen, Consultant at Up in the Air, pointed out that new approaches won’t take off without some incentives. “If open banking is going to work out, merchants need to give incentives and reasons to use it – if the customer doesn’t see the value, they’ll stick to their existing payment methods.”
Keeping customers on-board
Andrea talked about the need to see customers through each aspect of their journey. “Pre-travel is about hyper-personalisation, enabling them to book and do more and plan out their journey – and capture their hearts and mind. During the travel, it’s about protecting them during their trip, making sure they have the accessibility to everything they need. And post-travel, it’s about giving them insights into their spending, and also encouraging them to go back.”
Jesus focused on the customer experience aspect, particularly for younger travellers: “Airlines need to find the balance between market penetration, cost and user experience…New generations are more concerned with user experiences – they want good experiences and control. We have an opportunity to build a new payments ecosystem that works for all the generations and find new revenue opportunities.”
Shaun Morton pointed out that “The industry is very resilient. It adapts and bounces back.”, but believed the key was discipline. “Discipline is hugely important – the pandemic showed financial discipline. We’re often collecting cash long before people travel (and it’s seasonal), but we can only react well to problems if we are disciplined. We know there’ll be disruptive events in the coming years and we have to be ready for them.”
Paul Van Alfen brought it back to how companies need to improve their payment methods: “The speed of payments in the travel industry needs to be faster. It lags behind other industries and refunds are a highly emotional issue for customers.”
There was plenty more in the discussions, but that’s all we have space for at the moment. If you’d like to watch the entire series, you can do so here.