Early movers in mobile payments are already reaping rewards
Travel industry firms need to cultivate mobile-based trip bookers in order to take advantage of a growing yet still largely untapped opportunity, new figures show.
The travel industry’s share of mobile payments was 15.5% in the first quarter 2016, the latest Adyen Mobile Payments Index showed, that looked at travel industry data across the airline and accommodation verticals.
When compared to the overall global browser-based share of 32%, the findings highlight significant growth opportunities for travel businesses willing to invest in the mobile customer experience, said payments technology provider, Adyen.
In addition, the Index finds that, in terms of average transaction value (ATV) the iPad leads the way among mobile device types, with just over Euro 330 for accommodation services and Euro 295 for airlines. Following the iPad were Android tablets, which recorded Euro 262 and Euro 241 respectively, suggesting that consumers still prefer larger screens when making higher amount purchases.
According to the data, accommodation services are seeing 17% of browser-based transactions on mobile. However, it is no coincidence that many of the fastest-growing accommodation services start ups, such as Booking.com or HotelTonight, are capturing market share through in-app and optimised mobile browser-based experience, highlighting the opportunity for established players such as hotel chains to differentiate by providing a frictionless mobile experience.
“Mobile devices are inherently personal and it’s important for the content of the apps to react to the needs of the consumer in real time,” said Sam Shank, CEO, HotelTonight. “The hotel deals we present to a booker vary depending on where that booker is located and other factors, so we can present more relevant results, and increase conversion.”
The research shows 13% of transactions for airlines are currently made from a mobile device. However, airlines that are investing in mobile are seeing a far greater share of payments on a mobile device.
As an example, European airline Transavia is seeing a mobile payment share at 20%, 65% higher than the airline average, after investing in a mobile-optimised experience. As passengers become increasingly accustomed to interacting with airlines on their phones, and airlines offer services such as smartphone-based check-in and customer service on social media, the opportunity is ripe for innovative players to significantly increase their mobile payment share.
Said Roelant Prins, CCO, Adyen: “We are moving to a future where many loyal travel industry customers will make their entire journey in-app, from initial booking to final checkout, with payments as a key step in that journey. Beyond in-app, travel merchants that invest in optimized experiences for web browsers across key device types are already seeing their mobile transaction volume increase significantly.”
Since June 2013, the Adyen Mobile Payment Index has tracked the rapid evolution of mobile as a payment channel, providing insight into mobile payment trends for different devices and market sectors, across selected geographies and payment methods. The Mobile Payments Index is based on Adyen’s global mobile web payment transaction data, and does not track in-app mobile payments.