December 3, 2020
Travel Agency and Airline Payments Thought Leadership Series
Why it’s critical that agents and airlines partner to evolve B2B travel payments for air.
In the early days of travel payments, cash was king, interactions with travel agents were in person, and agencies received commissions. Fast forward, and advancements in technology mean today’s B2B travel payments landscape is driven by the customer experience. In particular, online shopping has shaped what customers expect from online transactions.
So, what does this mean for B2B travel payments for air? Agents and airlines need to reassess the role of longstanding legacy payment and settlement systems to capitalise on advancements in payment technology, and succeed in today’s global, cross-border, technology-driven landscape. Let me explain why.
The payment experience is now king.
New payment technology means the travel payments industry has changed. Payment products are wide ranging, varied, and can be physical or virtual. Travellers used to shopping online expect a payment experience that’s easy, seamless, and offers choice as well as reassurance that purchases are protected. This is the travel shopping experience that agents must deliver. And the only way a travel agent can is by adopting the retailer model, or, they risk frustrated travellers abandoning their purchase, which equals lost sales for agents and their travel supplier partners, including airlines. Instead, agents and airlines need to work together towards B2B travel payment strategies that reflect the commercial needs of both parties, and serve their common customer – the traveller.
Linking distribution and payment strategies.
The traveller’s experience is impacted whether they buy their ticket directly from the airline or indirectly via a travel agent. In Part One of this thought leadership series, we touched on why airlines need a B2B travel payment strategy that allows them to optimise indirect distribution through travel agents. Airlines who link their indirect distribution and payments strategies strengthen their agency partnerships, expand their reach and can offer greater payment choices. Plus, travel agent partners can also protect them from fraud and risk.
Merchant model becomes the prince of payments.
Technology has driven the change to the retailer model in travel to deliver the best customer experience. Controlling the transaction and payment experience is critical to agents meeting changing customer expectations.
To achieve this, the most successful agencies have turned to the ‘merchant model’, where agencies control inbound customer payments and pay travel suppliers in a streamlined process, allowing them to leverage the technology that has driven the evolution of B2B travel payments. Combine that with changes in the B2B travel payment landscape, in particular the airline/agent relationship, and travel agents have little choice but to adopt the merchant model to distribute payments. The good news is this approach means agents can deliver a seamless payment experience to the end traveller. That protects the purchase and allows travellers to make a single payment using their preferred payment method. The travel agent does the rest.
Partnering for sustainable B2B travel payments.
How airlines and travel agents accept and make payments has a direct impact on their one common goal – the customer experience of the end traveller. When the two parties work together to align their strategies, both can capitalise on the benefits of new payment technologies and drive a positive experience for their common customer.
Livia Vite, Head of Airline Partnerships, eNett International
You can read Part Two of our thought leadership series here. Or if you’ve got a question about how a B2B travel payment strategy can drive your business success, get in touch.