Investment needed to keep pace with consumer payments experience, finds Outpayce study
A new report from Outpayce, the payments division of European aviation technology giant Amadeus, has highlighted the need for improvement in customer experience.
The report is the latest in a series of insights into the aviation sector based on studies Amadeus has carried out with professionals in the sector.
The latest of these has found that “friction associated with travel payments is in contrast to the instant, invisible payment experiences consumers are familiar with when paying digital native companies in other sectors”.
The research found that improving the payment experience is the top objective for 75% of senior travel payments leaders from travel companies.
This imperative is prompting the industry to increase investment in payments capabilities by 12% on average over the coming 12 months.
Respondents were asked to rate how close their travel company is to delivering ‘a personalised omnichannel payment experience’ for travellers.
They gave the industry an average score of 2.7 out of 5, with just 4% of respondents giving the sector the top five-star rating.
More than half of travel payments leaders (51%) said their company finds it challenging to keep up with the rapid growth of new payment methods.
Amadeus said “as new card and non-card payment methods continue to surge across the world, travel companies must accept hundreds of new payment methods, often originating locally”.
The study also found respondents reported high costs, technical workloads and a lack of understanding about which new payments methods are popular, are all contributing to difficulties delivering on traveller demands to pay in new ways.
Another area of focus for was improving how travel companies handle cross-border payments.
Merchants operating in multiple markets typically need to establish partnerships with local acquirers in order to accept payments.
Travel companies like airlines must also be able to analyse and control these complex payment flows to ensure acceptance rates remain high and the cost of payments is well managed.
In total 40% of people surveyed by Amadeus confirmed that ‘orchestrating’ global payment flows is a top challenge.
Payments orchestration platforms have emerged over recent years to simplify this challenge by helping travel companies easily connect to a wide range of payments partners across the world, lower the overall cost of payments, as well as using AI to make real-time decisions on how each payment should be processed.
Just over a third of people who responded to the survey said they already use a platform to orchestrate cross-border payments, with a further third planning to implement the technology over the coming year.
When asked which payments capabilities their company is planning to implement this year, respondents pointed to virtual cards for B2B payments, the ability to accept alternative payment methods and delivering a consistent payment experience as key focus areas.
Jean Christophe Lacour, senior vice president and global head of products at Outpayce, said:
“It’s encouraging to see travel companies plan to increase investment as there’s a huge opportunity to simplify payments across the industry.
“At Outpayce we’re collaborating with partners and customers to systematically identify payment pain points across the end-to-end traveller journey working with airlines, hotels, airports, and travel sellers to address them through innovation.”
About the research
The report’s findings were derived from an online survey with 50 senior payments leaders from travel companies with more than €1B in annual revenues, during December 2023.
Respondents were drawn from the UK, France, Germany, UAE, USA, Mexico, Brazil, India, China and Korea to provide a globally representative sample of the industry.