Perspective on Payments: Worldline

Perspective on Payments: Worldline

As part of our ‘Perspective on Payments’ series, we interviewed Harry Boyd, Head of Global Sales for Online Payment Acceptance at Worldline Worldline to discuss payment flows in the travel industry, challenges and the shift to mobile. 

Worldline covers the entire payment value chain. Our technological experts create and operate digital platforms that handle the millions of highly critical transactions between a company, its partners, and its customers.


What makes the payment flow such an important part of the travel retail experience?

In any retail industry, a smooth payment experience is a key part of the conversion process. Payment friction is a frequent cause of cart abandonment, and can significantly impact your conversion rate.

If payment — the last step in the booking process — doesn’t feel easy, quick and safe, it annoys and worries consumers. For example, having to re-enter information they’ve already given (such as their address) can be enough for them to abandon the purchase, especially on mobile.

The travel industry is extremely competitive – there are many websites offering the same products; the same tickets. If buyers cannot find the payment method they prefer, or if the payment experience is poor for another reason, they may just look for another travel website which offers a smoother process.

 

What challenges are unique to the travel industry?

Intense competition means high price sensitivity and low customer loyalty. The global nature of the travel industry also means that merchants often need to manage a wide range of currencies and payment methods.

Travel companies often operate with slim margins, and as a consequence, they are sensitive to fraud and non-guaranteed payments. They cannot accept payment methods or transactions that could generate late declines or charge-backs. Intense competition means high price sensitivity and low customer loyalty. A fast, reliable cash flow is also critical, since travel agencies typically need to pay producers extremely fast.

The vast market and online offering for the travel industry has made meta-platforms such as travel search engines or marketplaces invaluable tools for every traveller.

 

Why do you feel that optimising payments is especially important to get right within the travel ecosystem?

Optimising their payment setup will enable travel companies to both increase revenue and reduce costs. A better payment experience leads to improved conversion rates and better margins, while reducing fraud obviously reduces unwanted costs.

 Optimising their payment setup will enable travel companies to both increase revenue and reduce costs.

What are travel suppliers and retailers ignoring now that they should start to consider if they want to succeed in the future?

Travel companies need to look at the total cost of payments, including costs related to foreign exchange. This aspect is often not thoughtfully considered and actively optimised.

To succeed on a global scale, it’s important to enable not only card payments, but other payment methods as well. In certain markets, only a small percentage of consumers own international credit cards. They prefer domestic cards, bank transfer, or even cash-based payment systems. In order to tap into the full potential of these markets, accepting additional payment methods will be necessary.

Finally, compliance with new legislation should be a key effort this year for companies that aren’t already prepared: PSD2 and GDPR come to mind.

 

How do you feel the shift to mobile has influenced payments?

The shift to mobile has encouraged consumers to spend. However, mobile shoppers are much more sensitive to any complication in the flow; they are much less likely to complete the payment if the process is cumbersome. Even being asked to enter the same information twice becomes a reason to abandon a purchase.

 

What innovations, shifts, changes in the payments world do travel suppliers and retailers need to watch out for? (e.g. eWallets)

eWallet is indeed a good example. The vast market and online offering for the travel industry has made meta-platforms such as travel search engines or marketplaces invaluable tools for every traveller. Making the purchase more frictionless for the consumer across multiple systems would be a significant market advantage for the operators of those tools. The ability for the consumer for example to pay for the travel “product” in one single payment step would clearly increase smoothness, trust and loyalty. Payment innovations such as a eWallet can facilitate this smoothness while maintaining security of payment data.

Making the purchase more frictionless for the consumer across multiple systems would be a significant market advantage.

— Harry Boyd, Head of Global Sales for Online Payment Acceptance at Worldline

Delivering an omnichannel payment experience is also increasingly important. In certain markets, travel companies may need to consider accepting installments and “buy now, pay later” programmes.

And again, compliance with new legislation and regulations such as PCI and scheme rules is a constant effort.

 

Do you expect there will be other consumer behaviour trends that will dramatically shift payment behaviour? What do you think they will be?

Mobile has come to stay, and optimising the mobile payment experience is crucial. We also see a trend towards buying experiences instead of just trips, including add-on products. There’s a lot of potential for suggestions based on data here. Increasingly short-term planning is also likely to affect payment preferences and behaviour.

There’s also always a risk that new kinds of fraud and security threats will impact consumer behaviour. Travel companies need to constantly stay abreast of evolving security challenges.

 

What specific actions would you recommend for travel suppliers and retailers to take as they seek to improve their payment flows?

We strongly recommend that e-merchants in any industry offer payment options that are truly adapted to local needs and preferences in their target markets. We consistently see better conversion rates when local payment preferences are satisfied.

 

What advantages can a two-sided marketplace (e.g. Skyscanner) bring to the industry?

The first that come to mind are credibility, size, scale, and pricing. The search advantage, too — I love the Everywhere solution!

 Search Everywhere with Skyscanner

 

What are the highest priorities for travellers at the payment point?

Simplicity and transparency are key, with the lowest possible number of clicks to purchase. At the payment point, travellers also like to have an easy overview confirming what they are paying for, including travel dates and other important data. Because travel purchases are often relatively high ticket, it’s also important for them to feel safe that the payment goes through and they won’t miss their trip. The confirmation page is important!

Most travellers prefer a payment page in their own language. And as already mentioned, there are many markets where offering other payment methods as a complement to cards can make the difference between a purchase and an abandoned cart.


You can find out more about Worldline via their website and learn more about the benefits of Skyscanner Direct Booking here. To learn more about partnering with Skyscanner, get in touch.

May news and insights from Skyscanner Partners

May news and insights from Skyscanner Partners

In May we have published news, interviews and insights touching on topics from our most recent Direct Booking partner, Singapore Airlines, to the trends set to disrupt travel and distribution. To ensure you haven’t missed any of it, we’ve pulled together a round-up of all our May updates.

 

Highlights

 

Insights and interviews

Singapore Airlines launches first NDC connection with Skyscanner. 
Read more … 

Discover the trends driving change in the travel industry, and the technologies and mindsets that you can adopt to capitalise on them.
Read more … 

Drive growth throughout the travel funnel with your content and customer insights.
Read more …

Hear from Svante Westerberg, Head of Global Strategic Development at Braintree on the value of optimising payments for performance, and how to approach it. 
Read more …

As investment in programmatic grows, discover how to use it to grow your revenue.
Read more …

Skyscanner CEO, Bryan Dove, talks Blockchain, Artificial Intelligence, Chats and Bots: understand the next level of technological innovation.

 

Upcoming event

Singapore Airlines launches first NDC connection with Skyscanner

Singapore Airlines launches first NDC connection with Skyscanner 

Singapore Airlines (SIA) has announced its first New Distribution Capability (NDC) connection with Skyscanner. Through this connection, customers will be able to book SIA flights more conveniently through the Skyscanner site.

NDC is an industry-supported standard introduced by the International Air Transport Association (IATA) which addresses some of the industry’s current inventory distribution  limitations. It creates  a more agile and efficient distribution system by supplementing the capabilities of third party channels to match those of the airline’s websites, thereby   improving offerings for customers making bookings on such sites.

SIA’s NDC agreement with Skyscanner introduces a more direct way for customers to book flights. Customers who choose to purchase SIA flights through Skyscanner will now be able  to do so directly, instead of having to be referred to the Singapore Airlines website to complete a booking.

  Boeing 777-200 in Singapore Airlines
Boeing 777-200 in Singapore Airlines

SIA recently obtained its Level 3 NDC  Certification, which covers both Offer and Order management, under which an airline takes full control of the way fares are offered to customers  as well as the booking,  payment and ticketing processes once customers have chosen a fare that they wish to purchase. Moving forward, SIA will further develop its NDC capabilities to offer other ancillary services and personalised offers for its customers.

We are pleased to be unveiling  our  first  NDC  connection  with  Skyscanner, to provide  more convenience to customers making flight bookings. With an NDC Level 3 Certification,  we will also be seeking out even more connections with travel partners to improve distribution  through SIA’s third-party sales channels,” said Mr Campbell Wilson, Senior Vice President Sales & Marketing at SIA.

We are delighted to have partnered with Singapore Airlines to offer travellers the opportunity  to search and book their fares seamlessly through the Skyscanner app and website. We believe our powerful direct booking capability is good for customers who can complete their booking  with  as  little  friction  as  possible, and good   for airlines, giving our partners like Singapore Airlines the ability to showcase their up-sell  options directly to the booking customer with a fully Singapore Airlines  branded  checkout  flow. Our  platform is compatible with any NDC-ready provider ensuring we are able to offer  our Airline and Hotel partners industry-leading distribution  options,”  said Hugh Aitken, Senior  Director Strategic Partnerships at Skyscanner.

We  congratulate  Singapore  Airlines  on  the  launch  of  this  NDC  connection.  With this  achievement,  Singapore  Airlines  is  taking  a  major  step  toward  transforming airline distribution, bringing more booking options to air travellers in  preparation for  the  new  era  of  airline  retailing  that  NDC  enables,”  said  Yanik  Hoyles,  IATA’s Director, NDC Program.


Interested to learn more? Discover Direct Booking 

Skyscanner’s approach to the programmatic travel world

Skyscanner’s approach to the programmatic travel world

This is a guest blog by Advertising Sr. Commercial Manager, Lourdes Losada. Lourdes started working with programmatic advertising before ‘programmatic’ was even a word and has worked within the digital space for the last 12 years. She currently leads America’s programmatic and data strategies from Skyscanner’s Miami office.

If you’re interested in finding out more about how we use programmatic advertising and data at Skyscanner, you can reach out to Lourdes on LinkedIn


Programmatic advertising offers a wealth of possibilities in industries like travel. Using segmentation and data enables businesses to reach their prospective user segments and target at a more granular level. As a result, many advertisers have come to rely on programmatic as they seek to enhance their campaigns and deliver more returns by using first, second and third-party data insights. According to Campaign, global programmatic spend now accounts for more than a quarter of digital media budgets and is up from 17% to 28% of digital media spend. 

Where is programmatic growth coming from? 

Articles from eMarketer highlight that the majority of this programmatic spend will come from North America, where 4 in 5 ads will be bought programmatically by 2019, followed by Europe (with $6.1 billion in the UK alone) and the Asia-Pacific region. However, the Middle East & Africa (MEA) is anticipated to achieve more growth in programmatic spend, followed by Latin America.

 US Programmatic Digital Display Ad Spending

The businesses that will benefit most from increased spending are those that offer transparency and quality assurance. It’s likely that private setups such as private marketplaces (PMPs) and programmatic direct transactions (Programmatic Guaranteed) will therefore see the greatest increase in spend.

Mobile advertising will also benefit. It is forecast that, by 2019, nearly 80% of programmatic spend will go towards mobile rather than desktop ads. This shouldn’t be surprising given that nearly 60% of all online searches are now carried out on a mobile device, and considering the value that mobile advertising can deliver (as explored in our recent feature).  

What is the Skyscanner approach to programmatic?

We’ve been developing a programmatic offering that goes beyond a simple PMP. As a data-driven business, where the viability of products and ideas is assessed through experimentation, we are keen to enable our partners to leverage our data and drive growth through a similar approach. We’ve therefore leveraged our learnings and insights to create inventory and data solutions that support our partners’ business objectives. 

Within our advertising team, our programmatic experts are increasing their focus on how we go beyond pure deals creation, towards a header bidding system where inventory is offered through multiple ad exchanges at the same time (as opposed to a waterfall implementation system). This will help us to connect with partners and surface all available inventory in a format that facilitates a smooth purchase process. Considering the opportunity that programmatic presents, we’re also aiming to have programmatic-focused markets. In countries such as Brazil, this could also offer a great solution for transacting with partners.  

Alongside this, there are three ways that we take a unique view and approach to programmatic:

1. Increased priority. We truly believe in the value of programmatic. Therefore, we reject the view that only remnant inventory should be sold via programmatic, and we’re making all our inventory available via programmatic. This will enable our buyers, who’ve been quick to adopt automated buying, to further scale their advertising and increase their performance. Specifically, we’re expanding our Programmatic Guaranteed offering, as partners look to combine our inventory and data. 

 The Skyscanner programmatic offering

2. Enhanced data offering. Data is engrained in our daily operations. It guides us, and our partners, in their operations – and supports their success. Therefore, we’re offering different ways for our partners to infuse data into their campaigns. Firstly, we’re enabling our advertisers to combine their first-party data with our inventory via their own DSP/DMP. This will enable those that want to use insights from their loyalty program, for example, to do so. We’re also enabling advertisers to leverage our second-party data via our preferred DMP. This provides the opportunity to target Skyscanner users based on key data points (e.g. travel intent from, travel intent to, date of travel, cabin class, number of travellers).

 Skyscanner audience intent segments

It’s also possible for advertisers to engage with our high-intent audience beyond Skyscanner with Audience Extension. By reaching users once they’ve left Skyscanner via retargeting, partners can capture potential customers across their full user journey. However, it’s worth bearing in mind that whilst we believe in the power of data, using too much in one go can make it difficult to isolate what’s driving performance. Taking an experimental approach to optimisation will ensure that you can improve on performance and returns over time in a methodical manner. 

 Skyscanner audience extension

 

3. Changes in measurement. We understand the importance of transparency, and being able to show results. However, we also believe that there’s value in looking beyond CPA goals – especially for clients such as airlines, hotels or car hire companies that often combine their metasearch efforts with advertising. We’re experiencing a shift, with companies thinking beyond last click attribution and considering other ways to measure campaign success, such as brand uplift studies. Ultimately performance is important, but it’s time to give some much-needed attention to branding, particularly for businesses that depend on high-value transactions that require a stronger and more consistent dialogue with the target audience.  

Interested in learning more?

If you’re interested in advertising with us, we’d love to arrange time to have a conversation. Get in touch via our contact form or download our Media Kit for more information.

 

 

The power of personalisation

The power of personalisation 

The initial unique selling point of metasearch was to provide a wide, transparent offering for the traveller and a platform for airlines and online travel agents to access travellers across the world and across verticals – all whilst accessing unique data and trend insight, and evolving technology. In recent years, greater access to data has allowed brands to see the consumer as paramount to determining success or failure in the competitive travel landscape. This has driven the industry to shift from cutting to costs to focusing on improving the customer experience and brand loyalty.

In this feature, we’ll explore how personalisation is applied at key stages of the travel experience, and how brands can utilise our technology and insights to ensure they’re keeping up with the industry.

According to a study by eMarketer, nearly half of US marketers saw over 10% uplift in revenue after introducing personalisation to their websites. At Skyscanner, we operate with a user-centric mentality and use data to drive almost everything we do. Recognising the evolving demand for personalisation in a world with growing digital deafness, we’ve started investigating how to leverage this trend to drive growth for our partners and serve our travellers’ needs.

Critically, marketing has evolved from a ‘build a product and they will come’ approach. Traditional methods of building brand loyalty initially stood within marketing activities, but this is difficult to apply to the meta model. With an excess of products, content and offerings in the marketplace, brands need to be strategic to ensure theirs can cut through the noise. A study by Amadeus highlighted that, with the industry becoming increasingly saturated, airlines and online travel agents are looking beyond prices, routes and segmentation to “better understand what individual travellers value” across key travel micro-moments like planning, searching and booking.
 

Planning

Hypothesis: Travellers want endorsements for travel

The rise of consumer-to-consumer (C2C) marketing, in a generation of social media and the psychological phenomenon that is social proof, has highlighted how important it is for brands to consider consumers as key stakeholders. The ability to widely share information can be a game changer for brands, and given the social nature of travel, this is an even more important facet to consider. Studies have shown that consumers are more likely to trust another consumer over a brand, and this C2C approach allows brands to create a more personalised experience by allowing consumers the chance to gather information from people just like them. 

We welcomed Trip by Skyscanner to the organisation in November last year. In doing so, we’ve been able to leverage their capabilities in providing hyper-relevant recommendations and user-generated content to make travel search and discovery more personalised.

We don’t believe that travellers can be catered to with a one-size-fits-all approach. Personalisation through ‘Tribes’ allows you to serve points of interest and reviews from other travellers that are tailored to your audience, creating a hyper-relevant travel experience that resonates and keeps them coming back.”  
– Gil Harel, Senior Vice President of Business Development, Trip by Skyscanner

C2C travel endorsement is lacking across the industry, and if airlines or online travel agents want to compete in the crowded industry, they must look beyond traditional methods of making a sale. Introducing personalisation into the planning stage, well before a user even decides to carry out a search, is a great way of doing this.
 

Searching

Hypothesis: Travellers like the option to view search results beyond just price

Amadeus notes that, for travellers making a booking, there’s a crucial balance to be struck between product, service and convenience. Each traveller will place differing levels of importance on these factors, depending on the make-up of their flight “affecting the overall price that they are willing to pay”.

More recently, we’ve seen brands changing the way they provide consumers with results to counteract this dynamic level of importance on product, service and convenience. Take our Flight Quality Score tabs on the search results page as an example.  After looking at the data, our in-house data scientists used machine learning to develop the Flight Quality Score in response to this demand. This feature lets users filter and rank results according to price and quality, allowing them to assess value in a more straightforward way.

Using the results of Flight Quality Score, Skyscanner users can now filter by ‘Best’, in addition to the previously existing options of ‘Price’, ‘Total Journey Time’, ‘Outbound Departure Time’, ‘Return Departure Time’, ‘Stops’ and ‘Airline’. These options are available through our Flight Quality Score tabs, which highlight the ‘Best’, ‘Cheapest’, and ‘Fastest’ filtering options, and in our ‘Sort’ options as showcased below.

Most importantly, we’re leaving personalisation up the user, allowing them to select whichever filter suits their needs. The impact has been significant: since it was introduced as the default option in August, the ‘Best’ filter has accounted for nearly 80% of exits in the UK, and the majority of users adopting this option have exited on one of the top three search results. ‘Price’ filtering has been selected and used as an alternative to ‘Best’ in nearly 19% of exits within the same period.

Within the wider travel ecosystem, airlines and online travel agents need to harness data to better understand the complexity of choice when making a booking, so they can make it as easy and relevant as possible. Take Netflix for example: on a platform where options can seem endless, rather than promoting content designed to appeal to a broad range of users, Netflix allows consumers to build a list of similar options based on content they’ve already watched, making the choice much simpler.
 

Booking

Hypothesis: Travellers want a seamless booking experience across multiple devices

The rise of mobile and other technology such as voice, has highlighted the need for a more seamless experience across multiple devices and has been a catalyst for the increased demand in personalisation. Mark Nasr, Managing Director of e-Commerce, Loyalty Programmes and Ancillary Revenue at Air Canada, notes that, “Customers want to interact [with a brand] through different channels at different times, but they expect to have a consistent experience.”

Our Direct Booking platform looks to respond to this change by offering a wide range of personalisation benefits for consumers, airlines and OTAs. Direct Booking is all about providing a flexible, optimised retail experience, bringing the right options to the top of the search in the increasingly small space of the mobile front page. It’s designed to put the retailer’s brand at the forefront and ensure a direct connection to the consumer, regardless of the context of purchase.

Direct Booking, in essence, is putting your booking engine in front of the traveller in locations beyond your own website. It is the evolution of metasearch in a highly cost-efficient, lightweight, frictionless way. Direct Booking allows the sale of ancillaries. It allows the booking to go into your own system, it allows you to follow-up with the customer straight after the booking.
— Gareth Williams, co-founder and CEO

The evolution of Skyscanner towards Direct Booking has already delivered returns for early adopters, with existing partners experiencing an uplift in booking conversions on basic tickets upwards of 20% across the board, and 50% on mobile. Additionally, there’s been an uplift in ancillary ticket sales of over 100%. This feature has broken down the ‘third party’ wall, and the industry must now keep up with this evolution towards providing a consistent, seamless experience. Brands such as Tmall have set the standard in online retailing and effectively demonstrate how branded storefronts offer the ability to up-sell products and increase brand loyalty.

Personalisation now goes beyond content to encompass how we distribute that content to the traveller, be that through mobile, bots or voice technology.
 

The implications of personalisation

So, how is a brand supposed to know what a consumer wants? Despite developments in AI and machine learning, we’re a still a while away from mind reading. But for now, data should provide enough insight. Times have changed from marketers using data to validate success in terms of page views and churn. Consumers are more informed than ever and expect brands to know exactly what they want, when they want it; and if they fail, the consumer will find a brand that does know.

In order to compete, brands should consider how to use content from fellow consumers; how they respond to complexity of choice; and how they can provide a more seamless and consistent experience. Flight Quality Score, Direct Booking and UGC are only a handful of ways in which we deliver value in response to this growing demand for personalisation. To gain loyalty, brands have to treat the consumer as king.

You can find out more about any of our products or understand how you can deliver value through personalisation here. To learn more about partnering with Skyscanner, get in touch. 

Perspective on Payments: Braintree

Perspective on Payments: Braintree

As part of our ‘Perspective on Payments’ series, we spoke to Svante Westerberg, Head of Global Strategic Development from Braintree for a view on the importance of the payment flow, challenges faced in improving it and what we can expect to change in the future.

 Skyscanner payments partner braintree

Braintree support all businesses, small and large, to accept and process payments in order to help maximize business opportunities and revenue growth. 

 

What makes the payment flow such an important part of the travel retail experience?

Booking and buying travel and travel experiences typically involves extensive research and high-ticket items. Once a user has discovered, browsed, and selected a product, any type of friction in the checkout- including onerous requirements, slow load times, lack of global payment options, or unfamiliar redirects – can cause a user to abandon their cart, especially on mobile where real estate and attention spans are limited.

Additionally, travel retail is evolving from a one-off, holiday-oriented experience to a consistent dialogue with the consumer, and so your capability to support and incentivize repeat purchases without having to ask users to re-enter their payment information is crucial.

Travel retail is evolving from a one-off, holiday-oriented experience to a consistent dialogue with the consumer.

Once a customer gets to the checkout flow, it should be the easiest part of the experience — the stakes are too high to risk losing your customer at the final step of a long process.

 

What challenges are unique to the travel industry?

Higher-than-average ticket sizes are not unique to the travel industry, but travel is more than a large price tag – it’s the highest sum most consumers will spend on non-essential purchases. The cost of travel drives specific payments-related challenges such as card approval rates, high exposure to risk and fraud and, in some markets, the necessity to split one order over multiple cards/payment methods.

Travel is more than a large price tag – it’s the highest sum most consumers will spend on non-essential purchases.

— Svante Westerberg, Head of Global Strategic Development, Braintree

In travel, you also must manage complex ecosystems of partners and suppliers – often using less-than-flexible legacy systems and technology. Your ability to tie this together into a seamless customer experience, especially when it comes to payments, requires using truly modular and innovative solutions.

As travel is global by definition, being able to support your consumers’ preferred currencies and payments preferences becomes more and more crucial. Cards are still king in most of the world, but e-wallets are gaining significant traction in most regions.

But, even offering the right currency and payment methods is not enough these days as travel is planned, discussed, purchased, experienced, and shared on mobile and with friends, and so getting that user experience right is more important than ever.

 

Why do you feel that optimising payments is especially important to get right within the travel ecosystem?

The travel ecosystem benefits from an optimised payments flow to drive both incremental revenue and increased profits. Incremental revenue stems from lower abandonment, higher approval rates, better mobile conversion, fewer false positives, and better fraud processes, but also if you are able to enable entire new revenue sources through partners.

Increased profits come from more stringent fraud protection – lowering operational costs per transaction, but also by offering high-margin add-on products through shared-data partners without having to invest in costly integrations or a more complex payments flow. These are examples of the unique combination of payments solutions that Skyscanner has so successfully been able to implement through its partnership with Braintree.    

 

What are travel suppliers and retailers ignoring now that they should start to consider if they want to succeed in the future?

Payments is still very much an afterthought when looking at most customer experiences in travel, which could lead to unnecessary loss of sales and customers. In addition to a higher focus on acquiring loyal, repeat customers, the travel segment must get better at facilitating and simplifying the path from discovery to purchase.

When asking for payment information and personal details, make sure you simplify the data collection as much as possible, especially on mobile. Tokenize the card details so you can make repeat purchases an incredibly low-friction experience.  

The travel segment must get better at facilitating and simplifying the path from discovery to purchase.

— Svante Westerberg, Head of Global Strategic Development, Braintree

Loyalty and rewards programs have a natural place within the checkout flow of the travel sector. It’s key to create and enforce loyalty through integrations with multiple rewards programs. Facilitating this without seamless and secure sharing of sensitive data with your partner ecosystem quickly makes this area of almost endless opportunities extremely complex and costly.

Another largely ignored area of opportunity is to make it possible for the consumer to go from discovery to purchase without friction, contextually. This is probably one of the most important keys to success for the travel segment moving forward. Imagine a potential customer searching for a dream vacation, finding exactly what they want, and then completing the booking without ever leaving the app in which they discovered you. All if this is currently possible with Braintree’s commerce infrastructure tools.

 

How do you feel the shift to mobile has influenced payments?

The shift to mobile is bringing a whole new set of requirements and challenges starting with the need to rethink the complicated, merchant-centric payment flows of the past. The need to minimize steps, pre-populate information, enable biometric authentication (such as PayPal OneTouch, with a proven increase of up to 50% in conversions), use geo-localization data to create better user experiences as well as minimize fraud. These are all examples of necessities and best practices to increase conversion in the mobile channel. In addition to the challenges imposed by the more limited screen real estate, there is also the issue of time sensitivity – for every extra second it takes a mobile page to load, your conversion can drop up to 7%.

Clearly, mobile is also opening up entire new worlds of opportunity, truly blurring the lines between what we traditionally have called online vs in-store payments as well as in-context and geo-location based commerce.

 

What innovations, shifts, changes in the payments world do travel suppliers and retailers need to watch out for? (e.g. eWallets)

Major shifts and updates to the legal and regulatory landscapes are creating and will create big challenges for the travel industry – especially in the European region. From Payment Services Directive II (PSD2), General Data Protection Regulation (GDPR), 3DS 2.0 (3DS2), to achieving and/or maintain PCI compliance, this is another area where choosing the right payments partner makes a huge difference.

When looking at overall global commerce, digital wallets are now the leading form of payment for many online shoppers. Case in point: PayPal has more than 225M users globally who averages nearly 34 transactions per year. This is a game-changing trend that could open the door for huge numbers of new customers as well as higher conversion rates. Combine those wallets with social media, and you’re looking at new consumer behaviours and requirements – P2P buying/selling (such as Venmo), splitting payments, and extremely high levels of engagement and loyalty.

 

Do you expect there will be other consumer behaviour trends that will dramatically shift payment behaviour? What do you think they will be?

We believe we are only seeing the beginnings of many of the trends and shifts mentioned here. The old norm for payments has been that it takes a long time to create true change in payments behaviour and preferences, but looking at the last 4-5 years we have seen big changes taking effect much faster than ever before. How many times have you walked out of a regular taxi forgetting to pay because you thought you were in an Uber or Lyft? We are definitely going to see continued shifts in payments technology, mainly driven by new consumer expectations and the explosion of the mobile channel for the likes of in-context commerce, social and peer-to-peer payments as well as digital wallets.

Looking at the last 4-5 years we have seen big changes taking effect much faster than ever before.

— Svante Westerberg, Head of Global Strategic Development, Braintree

We will also see even more global/cross-border commerce as well as commerce enacted through new interfaces like Alexa, Google Home, and Apple HomePod.

 

What specific actions would you recommend for travel suppliers and retailers to take as they seek to improve their payment flows?

One of the most important aspects of improving your payment flows starts with thinking about payments as something more than just the way to get paid at the final step of a transaction. When looking at highly successful companies, their payments strategies often play an important role through all aspects of their retail experience, many times starting already in the customer acquisition phase.

But, keep in mind that it is not necessary to rip out all existing legacy systems or payments solutions in order to start improving your payments flows. Using a payments solutions provider that provides flexibility and innovation, you can start with one or two areas of improvement and achieve significant results short-term, while working on mid- to long-term initiatives in parallel.

 

What advantages can a two-sided marketplace (Skyscanner) bring to the industry?

Skyscanner has already taken great leaps using innovative payments technologies to create new and unique end-user experiences. Being able to wrap a unified and simplified customer interface around what is a very complex ecosystem of partners and payments flows is very powerful and has already proven extremely successful. It provides the ability for a Skyscanner customer to go from inspiration to research/discovery (over multiple travel producers) to intenti.e. completed purchase – all within the same, familiar and beautiful user interface. Many key metrics have improved dramatically for Skyscanner as a result, including conversion rates, increased revenue (including new, incremental revenue), and lower operational cost per transaction.

It’s important to note here that Skyscanner has been able to go beyond offering just lower fares to offering truly better experiences.

 Example of British Airways Direct Booking on app.
Example of British Airways Direct Booking on app.

What are the highest priorities for travellers at the payment point?

The payment and checkout flow is a critical part of any retail experience, but it is even more important in travel due to the complex customer journey as well as high average ticket size. The goal for you and your brand is to create as frictionless a payments flow as possible so you’ll minimize the risk of losing an order – and a customer – at the final step of a process.

Top priorities include speed, convenience, security, the right payment options, as well as a very good information flow throughout the process–make sure your customers always know where they are in the flow, provide continuous notifications/confirmations of what just happened and what will happen next.

Having a payments solutions in place that provides the flexibility to test different checkout flows is key. Get data on what really works and what doesn’t. The only way to truly know what the highest priorities are is being able to listen and react to the customer.


You can find out more about Braintree via their website and learn more about the benefits of Skyscanner Direct Booking here. To learn more about partnering with Skyscanner, get in touch.

The Future of Travel: Trends set to disrupt travel and distribution

The Future of Travel

Trends set to disrupt travel and distribution

 

With over 70 million app downloads and monthly active users, Skyscanner has successfully developed a two-sided marketplace that meets the needs of both travellers and travel suppliers by surfacing a wide range of travel offerings, and providing access to a global marketplace. 

To date, we have achieved this predominantly through a traditional metasearch model, in which users visiting the app or our website redirect onto the supplier website and book their flight, hotel, or rental car there. Yet over the last year, we have transformed our approach to meta and introduced Direct Booking with the likes of British Airways and Scoot. With Direct Booking, suppliers are enabled to showcase their brand and the full range of ancillaries on Skyscanner, whilst retaining ownership of the customer and the payment transaction. They also benefit from the scale and knowledge that we have at Skyscanner around the behaviour and needs of our users.  

This change was a direct response to the trends that we anticipated and saw emerging across global retail markets; all of which highlighted a need to make transactions more seamless and instantaneous to accommodate digitally reliant and mobile-first travellers. Early adopters of the Direct Booking platform have seen an uplift in booking conversions of +20% on basic tickets and 50% on mobile bookings, along with a +100% uplift in ancillary ticket sales. This highlights the value created for travellers by this alternative approach to meta, particularly on mobile.  

 Benefits of Direct Booking
Benefits of Direct Booking

However, to drive growth, airlines need to consider how they can respond to market trends across a multitude of platforms and channels (not just on Skyscanner). So, we have outlined the five trends that highlight the need for a fresh approach across the travel ecosystem, along with the technologies and mindsets that airlines can adopt to capitalise on the changes ahead as we move towards the future of distribution.  

 

Trends impacting the future of distribution

Artificial intelligence supports improved interactions 

Artificial Intelligence (AI) based innovations are already making an impact throughout the travel journey – from the facilitation of smarter suggestions in search and booking, to the introduction of digital concierges that can answer your questions in-destination. At Dubai International Airport, security has even been upgraded using AI; with cameras embedded in a virtual aquarium, travellers can be scanned, identified and on their way in a much more enjoyable manner.  

Ultimately, what all AI innovations respond to is the traveller’s desire for more convenience and greater efficiency. Almost a third (29%) of global travellers say they are comfortable letting a computer plan an upcoming trip based on data from their previous travel history and half (50%) don’t mind if they deal with a real person or computer, so long as any questions are answered.

At Skyscanner, we have witnessed the migration of travellers from the click-type-tap patterns that are common in apps and sites, to a more conversational format in which they ask casual, but fully-loaded questions. This has driven us to create chat interfaces across Facebook Messenger, Amazon Alexa, Microsoft Cortana and Skype that have more than one million unique interactions to date; and encouraged us to enable others to do the same through knowledge sharing and our API offerings.  

For airlines, this has a few implications. Naturally, considerations must be made about how to leverage these new channels and respond to the change in customer behaviour and expectations – particularly around customer service enquiries. For example, how do you handle the assumption that travellers will be able to ask you questions and raise issues 24/7 using Facebook Messenger? Similarly, airlines must ensure they have a brand presence on any new platform in which their audience wants to interact with their brand; whether that’s on Alexa, or via a Skype Bot. Most importantly though, airlines need to consider how to operate and differentiate their offering in a brand-agnostic environment. In the world where individuals are asking “Hey, Alexa, where can I go for $200?”, how will you stand out? 

 Skyscanner on Facebook Messenger
Skyscanner on Facebook Messenger

 

The personalised travel future  

As the travel ecosystem becomes more complex and intertwined, and it becomes more challenging to attract and retain customers, companies need to find new ways to differentiate themselves and garner loyalty. With relevant recommendations expected to expand revenue per passenger by 20% in 2025, the effective implementation of personalisation will determine the travel businesses of the future.  

The in-depth analysis of big data and real-time analysis acts as a great starting point from which to develop a unique journey for your customers and deliver value across the travel cycle. However, in the ultra-competitive travel landscape, success takes more than being data driven. Companies will need to reach new levels of personalisation through increased customer interaction, and better connections and collaboration with others inside and outside the travel ecosystem. This includes connecting with new distribution channels and technologies, such as voice and chat bots.  

For airlines this presents a challenge – as many are built on legacy systems with de-centralised data – but also a great opportunity. Although migrating towards a centralised system that enables big data, real-time analysis and connectivity can seem arduous, once this is in place you can capitalise on this data and the insights it provides. From dynamic and highly personalised email campaigns, to optimising in-flight offers based on previous traveller purchases and preferences, the opportunities to enhance profitability and improve loyalty really are endless.  
 

Embracing change from the East

China, and other major economies in South-East Asia, are set to play a major role in influencing the future of distribution. With 43% of bookings in China completed on a mobile device, these markets are well ahead of the curve and setting trends across the digital economy that later diffuse into global markets. So, whilst these markets are unique in their pace of change and delivery, the trends experienced in China and other parts of South-East Asia will translate over time, making learning from businesses in these markets invaluable.  

 Alibaba's Tmall
Alibaba’s Tmall

There are two companies in the Chinese market that have captured our attention at Skyscanner and set standards for ecommerce retailers, and travel companies, which airlines should be looking to emulate.  

Alibaba’s Tmall is an ecommerce business which has amassed over 488 million active buyers. Its captive audience demonstrates that its supplier-brand led approach, in which each company has a “store”, has delivered value to Chinese online shoppers whilst also benefiting suppliers. With space and ability to control the display of their products and an abundance of up-sell opportunities built-in, brands can build loyalty and retention whilst tapping into the size of Tmall’s user base. 

WeChat, a dominant messaging app, has adopted a similar approach. Users can browse the integrated WeChat stores of their favourite brands and make a purchase with one click. In addition, a large portion of WeChat users are also engaging in social shopping on the Chinese messaging platform; sharing links to products and discounts. This highlights the need to not only give brands their own space, but to also find ways to enable purchases through new, more social, means of distribution.  

Evidently, brands looking to compete in China are expected to be present and available in a multitude of formats; through the storefronts of ecommerce companies such as Tmall, and in messaging apps such as WeChat. The implication being that all businesses, including airlines, need to consider how they represent and differentiate their brand across platforms. With the number of platforms and technologies growing at scale, airlines also need to consider connectivity. Developing a solution for each platform will not be sustainable or scalable going forward – and companies that take a platform by platform approach will be slower to market and burdened by high investment costs when seeking to innovate. Re-architecting your business is critical to being successful in the future of distribution.  
 

Reinvention for the mobile-first traveller  

Although voice, bots, and other AI based technologies have stolen the spotlight, mobile remains the distribution channel with the fastest growth – with 54% of travel bookings now made in-app and 70% of all travel bookings forecast to be mobile by 2020. However, not all airlines are prioritising the optimisation of their mobile proposition.  

With changes such as push notifications driving a 9% increase in conversion rate, investment needs to be made to improve the search and booking process, using data and analytics to respond to the needs of digitally dependent travellers. This includes finding ways to interact with consumers through the channels they use every day, like messaging, instead of forcing them to open a different app every time they want to do something.  

This digitisation in aviation, travel and tourism is expected to create up to $305 billion in value between 2016 and 2025 throughout the ecosystem. Additionally, $100 billion of value is expected to be transferred from traditional players to new competitors over the next few years. To get a slice of this high value pie, companies throughout the travel sector need to embrace digital innovation – or risk being left behind.  

With many airlines still trying to improve their experience on-site, it will be another few years before apps are meeting the needs of mobile-first travellers across the board. And it may be even longer before airlines focus on distributing across the ecosystem of the traveller rather than directly via their website. To make progress, airlines will have to make technological investments – and more importantly, they need to overcome their fear of losing the direct ownership and relationship with the customer. Only by shifting their perception of indirect channels and platforms can airlines hope to dominate in the future of distribution.  
 

 Skyscanner Direct Booking
Skyscanner Direct Booking

Payments as a feature, not a pain point  

The payment process is a critical contributor to performance for travel suppliers and retailers alike. It is fundamental to converting users from browsing to booking and failing to optimise payment solutions can damage performance in the short-term and hinder the potential for companies to maximise customer lifetime value.  

Whilst the causes of poor payment performance can be resolved in most cases, businesses across the travel ecosystem have only just begun making improvements to their payment solutions. They have some way to go before meeting the expectations of digitally minded travellers who are familiar with the likes of Amazon and Airbnb. With the continued growth of mobile, and the rise of eWallets which are forecast to account for 46% of global transactions by 2021, it is evident that maintaining the status quo is insufficient for travel companies looking to compete with mobile-oriented disruptors.  

Airlines seeking to serve the needs of today’s users need to re-assess their payment process and seek to reduce friction. This will deliver benefits not just at the initial point of booking, but also when seeking to capitalise on up-sell and cross-sell opportunities; from seat reservations ahead of the flight, to meal purchases during it. With Wi-Fi in place on a growing number of planes, in-flight shopping could also benefit from advancements in payments. The airlines that gain the most will be those that transform their payment process from a pain point to a feature and use it as a differentiating factor; enabling travellers to purchase, change their flight, or take-up an upgrade offer with the tap of a screen.   

 

Be the disruptor, not the disrupted  

Transformation and trends in the travel sector are all about increasing speed and creating agility to spot and respond to the needs of customers even before they recognise what they want. Companies need to be equipped with infrastructure that enables efficiency, and the delivery of personalised experiences based on real-time data.  

Progression towards this will take place in phases, as outlined in the following diagram. And the progression from traveller-centricity to end-to-end propositions requires the recognition and implementation of four transformative mindsets and technologies.  

 Phases towards hyper-customisation
Phases towards hyper-customisation

Enhance satisfaction and growth by expanding distribution

With an ever-growing number of travel businesses, there is increasing fragmentation – driving users to have to open a new website or app for every aspect of their travel journey. This not only makes searching and booking challenging for travellers, but it also restricts the scope of brands and their ability to enter new markets. This limits the opportunity for business growth on every level.  

To combat this, businesses need to be open to new distribution methods and a wider set of connections. This includes integrating with technologies and platforms which bring them into the daily lives of consumers and enable them to engage with individuals in ways that add value to both the business and the user – such as Facebook Messenger or Alexa. 
 

Enable true agility and connectivity with the New Distribution Capability (NDC) 

 A key issue for travel businesses looking to deliver at pace are the legacy systems on which many of them operate. The objective of NDC is to unify the information ecosphere that blocks innovation and progression in the travel ecosystem: bringing commonality, simplicity and lower barriers to entry.   

NDC also takes travel content distribution to the next level, modernising the way products can be sold by travel agents, corporations and beyond. With its retail-focussed approach to distribution it is designed to meet traveller needs, and enables businesses to showcase ancillaries and innovate at scale. With NDC in place, businesses can also capitalise on the emergence of new distribution channels without the need to develop a compatible API for connectivity.  
 

Add value throughout the funnel with AI and Machine Learning

Given the trend towards both personalisation and more conversational interactions between brands and individuals, both AI and Machine Learning are primed to bring the next wave of disruption (following on from mobile). Capitalising on these technologies will empower businesses to deliver seamless solutions designed to meet the needs of travellers throughout the search and booking journey; and facilitate personalisation to generate more value.  

Taking steps towards leveraging these technologies will be no easy feat; particularly for businesses built on legacy IT structures. So, it is worth considering how sharing models can be used to reduce the upfront investment required and enable airlines to benefit from the experiences and learnings of experts in technologies such as bots. This approach will become even easier as systems become more interoperable; particularly as NDC becomes more widely adopted.
 

 AI and Machine Learning can add value throughout the funnel
AI and Machine Learning can add value throughout the funnel

Keep looking East for inspiration  

With new trends, technologies, and innovations constantly emerging, it is critical to lookout for inspiration at all times; particularly from the East, and more specifically China, where behaviours often foreshadow where the rest of the world will be in the next 10 to 15 years (or more). Technology also advances at a faster rate in the markets of the East, so the capabilities that are being developed today can give your business a chance to prepare itself for the disruptions – and opportunities – that are to come.  

At Skyscanner we have looked at what we can learn from some of the Chinese apps. Jing Dong, for example, is used to purchase larger electronic products and has generated trust through excellent customer service (in-app chat) and fast refunds. TaoBao, another retailing app, is differentiated by its picture search function. By pressing the camera, you can take or upload images and highlight the parts of the image you would like the algorithm to search for. Its speed and accuracy also distinguishes it from apps offering similar features. These apps, and others, have implications for our features and design as we look to the future.  

 

Get set for the next era of travel and technology   

With trends and technologies set to transform the industry, it is time to prepare your business and adapt to the future of distribution. As you consider new distribution channels and technologies such as AI, progress towards the implementation of NDC, and continue to look outside of your business and to the East for new opportunities, it is worth coming back to the following questions:  

  •  Are we where the traveller is?  
  • How are travellers using technology to plan trips? 

  • Are we delivering solutions aligned with the digitally-dependent and mobile-first traveller? 

  • How do we stand out in a world that includes both brand-centric and brand-agnostic channels?  

  • Are we continuing to learn from other businesses – not just airlines – and thinking globally?  

  • Are we considering how we enhance engagement and retention, not just revenue?  

Partnering with companies such as Skyscanner will also benefit airlines and others in the travel ecosystem seeking to leverage our expertise around mobile and bot technology, as well as the data captured on the behaviour of our 70+ million monthly visitors.  

 

Interested in learning more about how our technology and data can benefit your business?  

 

April news and insights from Skyscanner Partners

April news and insights from Skyscanner Partners

In April we have published news, interviews and insights touching on topics from our latest Direct Booking partner, Cathay Pacific, to how you can face the biggest challenge and opportunity in the travel industry: retailing. To ensure you haven’t missed any of it, we’ve pulled together a round-up of all our April updates.

 

Highlights
 

Insights and interviews

How to face the biggest challenge and opportunity in the travel industry: retailing.
Read more …

Skyscanner innovations are set to meet growing demand in the Indian market
Read more … 

Interview with IATA: Yanik Hoyles, Director of the NDC Programme
Read more …

Determine new route opportunities and maximise your profitability with Skyscanner
Read more …

Three ways airlines and airports can make the most of data
Read more …

A view from easyCar Club on trends, disruptive technologies and more
Read more …

Partnership with RapidAPI lets developers put flight search in their apps
Read more …

 

Upcoming events

Three ways airlines and airports can make the most of data

Three ways airlines and airports can make the most of data

As the aviation industry improves its digital links with passengers, there are countless opportunities to apply consumer behaviour data to enhance the passenger experience, improve conversion and boost competitiveness.

At Skyscanner, data is a key driver in all decisions that we make, especially as we seek to serve the needs of a growing number of travellers. Our unique data is used to drive experiments, decisions and opportunities; as well as provide an understanding of when and where users are searching and booking. With these insights to hand, we can understand how traveller segments prioritise what they need from travel and deliver our products to suit those needs.

So that others in the industry can benefit from this data and gain insights, we have introduced Travel Insight – a data product that helps businesses improve their network connectivity, manage flight revenue ahead of the departure, develop new route opportunities and support all travel-related marketing. Not only can Travel Insight data show volumes, but also a level of granularity that isn’t always present in other industry data sources such as geo-location and party size. In this article we explore three ways for you to start making the most of data with examples of how it can be applied, including our very own Travel Insight.

Here are three applications to start thinking about…

1)    Better marketing and retail

Airlines are getting smarter about boosting revenue by selling ancillaries. By applying data on customer preferences, they can do better – especially if they make timely and actionable offers directly to passenger mobile devices throughout the journey. While individual trends may be easier to quantify for frequent flyers, applying insights on trends specific to regional markets or passenger demographics can also help improve conversions on offers. Airports are already applying passenger demographic data to help design their terminal experience and improve targeted offers from concessionaires.

One trend we’re watching: Mobile IROP (Irregular Operations). By sending timely offers direct to mobile airlines and airports could better address travel disruptions and irregular operations and even sell helpful services like ground transportation, lodging, lounge access, meals and flight re-bookings.    

2)    Improved collaboration

Airlines and airports can help each other to address passenger needs and improve the efficiency of operations by exchanging flight and passenger data more effectively.

One application development we’re excited about: IATA’s New Distribution Capability. By establishing a standard for passenger and flight information that makes data exchange easier, the airline industry is helping to boost innovation and encouraging third-parties with fresh ideas to do their part to make air travel better (and more profitable).   

3)    Data driven decisions

By studying consumer behaviour in flight search, airlines and airports can also identify market gaps ahead of their competitors. Using data in intelligent ways can guide better decisions on the launch of new routes, as well as help airports better target their offers to existing airline customers and new entrants.

Who knew that Londoners are most eager to visit Morocco, Luxemburg and Algiers?

Let’s just say, thanks to Travel Insight data, we had a clue. 



Interview with IATA: Yanik Hoyles, Director of the NDC Programme

Interview with IATA:
Yanik Hoyles, Director of the NDC Programme

 Yanik Hoyles, NDC Programme Director
Yanik Hoyles, NDC Programme Director

We interviewed Yanik Hoyles, Director of the New Distribution Capability Programme at IATA to discuss NDC, challenges in the travel industry and what we can expect to change in the next five to ten years. 

IATA (International Air Transport Association) represent 83% of total air traffic. They provide support to the aviation industry with global standards for airline safety, security, efficiency and sustainability.

 

In your opinion, what are the biggest challenges facing the travel industry and why?

In my opinion the airlines’ biggest challenge today is how to become true retailers bearing in mind the industry’s current constraints as well as the inertia towards status quo. The beauty of challenges though, is that they can always be transformed into opportunities when looked at from a different angle. 
 

How do you think NDC can help to overcome these challenges?

NDC is a key enabler in this journey towards true retailing. However, first of all, airlines need to start to understand and to assess the potential that retailing can bring to their businesses. Let me stress that we consider NDC to be the starting point of a non-return journey towards industry retailing – where airlines are lagging behind most other industries. Probably to date, NDC’s biggest contribution besides setting the standard itself has been a gradual change of mind-set taking place among key industry key stakeholders who are now all engaged in this journey.
 

What do you think will change most in the industry in the next 5 – 10 years?

In the next 5 – 10 years, besides AI which is currently in the spotlight, Blockchain will play a prominent role – especially in the areas of distribution, payment and revenue accounting. Blockchain is about transparency, disintermediation, security and a single source of truth. I believe the industry will find that Blockchain has a solid business case behind it to become another transformational game changer in the mid to longer term.

What do you expect the biggest changes relating to NDC will be in the next 5 – 10 years?

Right now the NDC program is moving from industry capability to industry critical mass adoption. In 5-10 years from now the majority of transactions will come from airline NDC channels (direct or via aggregators). Today’s world of distribution is based on technology that is decades old, with a very small number of dominant players. In 5-10 years, as the barriers to entry will be lower, we will see a larger number of players entering this space to innovate and to compete. And in this scenario, challenges will come from incumbents who will adapt their value proposition as well as large and small new competitors.
 

Which companies do you believe will be the biggest disruptors in years to come and why?

I truly believe in the value that airlines can bring to customers as well as their favourable position as the content providers to other stakeholders in the value chain. Airlines should leverage on this privileged position and IATA will do everything it can to help them in this purpose.
 

You previously worked for British Airways, what did your time working at an airline teach you?

Airlines are complex businesses with small margins and that are regularly exposed to external factors they don’t always necessarily control: price of oil, weather, security threats etc. The only way to survive and thrive is to have a constant focus on cost balanced with an obsession about the customer. This focus, coupled with resilience and constant openness to change is part of what I learnt over close to 20 years working at British Airways.
 

What one book would you recommend for leaders across the travel ecosystem to read?

Steve Jobs by Walter Isaacson. Lessons of leadership, innovation and change.


You can find out more about IATA via their website. If you are interested in learning more about NDC and how to get started with Skyscanner, you can learn more in our ‘Guide to NDC’ with IATA.