Split payment solutions have become an acute need for businesses in the hospitality and travel agency space. Antic elegantly solves both the tech and product challenges that arise.
Cart abandonment is not just a problem in the e-commerce world. According to a blog post referencing data from Econsultancy.com, OTAs experience this problem at its worst with an 89% abandonment rate, followed by hotels at 71%. The post further states that 81% of visitors to travel industry web pages abandon cart, which means getting potential guests to actually make the payment is an immeasurable challenge. To address this, a new and more flexible payment solution simply makes sense.
The travel industry is changing at lightning speed and with the advent of new technologies and payment processors, one thing is certain: consumers expect more flexibility and hyper-personalized experiences. For hotels, short-term rentals and online travel agencies, keeping up with unpredictable consumer behaviors is proving difficult. From sleep tourism to voluntourism, coolcaytions to dark sky destinations, the hospitality landscape is experiencing a mad rush to keep up with what travelers expect.
One such expectation is the ability to split the bill on multi-person trips. Family vacations and friend getaways have always been on-trend, but the payment expectations for those have totally changed. Rather than a single person footing the bill and collecting cash after the fact, now online bookers want to be able to send a link to their friends and family and have each person pay their share. Add to that the need to split a single bill over multiple payment methods. After all, with Apple Pay, virtual cards and multiple credit cards now being a staple in every person’s wallet, it makes less sense to put the charge for a big trip entirely on one payment method.
This shift towards joint purchasing and splitting costs over multiple payment methods means you need to find more innovative solutions that meet consumers' financial preferences and redefine business-customer interactions.
When considering how many people need or expect a split-pay solution for their travel needs, we first need to identify who we’re talking about. Gen Zs are currently the biggest spenders in the travel market, and though they don’t have as much disposable income as their millennial or Gen X counterparts, they’re highly influenced by social media, which dictates to them that travel is not just a luxury, it should be part of their day to day. “In short, they’re being raised in a society where travel is more prioritized than it was for past generations,” explains Lindsey Roeschke of Morning Consult, in an interview with CNBC. A survey shows that 52% of this market are traveling more than 3 times per year, much more than their Gen-X or Baby Boomer counterparts.
And while they’re dedicating more of their budgets to exploring the world, the fact that they have little disposable income means they’re ideal for flexible payment solutions. With a split pay solution, that allows them to cover the cost of travel with multiple cards, or split a group purchase with their friends, each paying their share, gives them access to boutique hotels and luxury stays.
A report by Grand View Research, the global digital payment market size, within which split payments play a significant role, is expected to reach USD 132.5 billion by 2025, expanding at a compound annual growth rate (CAGR) of 17.6%.
Offering payment flexibility allows you to attract a broader range of customers, including groups and event organizers who may prefer splitting the bills. This, in turn, leads to increased bookings, higher occupancy rates, and, ultimately, higher revenue. Group purchases currently make up 40% of most online sales. If you don’t have split pay integrated into your booking engine or checkout flow, you could be missing out on up to 15% more completed payments (and fewer abandoned carts).
When one person initiates a group purchase and sends a payment link to their friends or family, you get new customers. Simple as that. Everyone who visits your platform to contribute to the group pay becomes a new acquisition for you without any additional marketing spend, thus lowering your cost of user acquisition and allowing you to collect valuable data on these new spenders.
Cart abandonment is not just a problem in the e-commerce world. According to a blog post referencing data from Econsultancy.com, OTAs experience this problem at its worst with an 89% abandonment rate, followed by hotels at 71%. The post further states that 81% of visitors to travel industry web pages abandon cart, which means getting potential guests to actually make the payment is an immeasurable challenge. To address this, a new and more flexible payment solution simply makes sense.
Antic has created a split pay solution to meet this consumer need head-on. With a smooth integration into your existing checkout flow, you’re able to better align your current offering to meet changing consumer preferences while still:
The travel industry is transforming with every passing day, as are the expectations of your potential customers. Right now, you need to offer more flexibility if you want to get those bookings. And in an industry rife with competition, there’s never been a better time to ask, “How do I outpace my competitors?” Adjusting your costs and offering superior service simply isn’t enough anymore.
