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Innovative Payments and Policies are Key for T&E Recovery

Traveling outside the home, let alone to remote destinations, was brought to a standstill by the pandemic. And while consumers got used to working and living entirely at home, they got even more accustomed to visiting many places digitally.

Now, with the emergence of new COVID variants dampening some of the earlier optimism brought by effective vaccines, the travel and entertainment (T&E) industry is responding to a brand-new era and the high expectations that travelers bring to it.

“It’s clear consumers have a strong desire to travel again as the economic recovery continues,” said Jacob Ayoub, vice president of consumer and competitive insights at Discover® Global Network. “But it’s important to note that right now U.S. consumers are considering costs, flexibility and the spread of COVID-19 while traveling.”1

T&E is back on the agenda

Even with the emergence of new variants and ever-changing international travel restrictions, there seems to be no shortage of pent-up demand of consumers, who are keenly aware of what they’ve been missing—and what they want.

While companies began to map out business travel budgets and decide on return-to-office plans, leisure travel bookings started to rise in many parts of the world in 2021—thanks to vaccinations and the lifting of some travel restrictions. In the U.S., for example, the number of travelers passing through airport security through the summer more than doubled over figures for 2020, though they had not yet reached 2019 levels.2

Consumers in other parts of the world were also looking to make up for lost opportunities. Over the summer, domestic travel within the Asia-Pacific region picked up much of the slack in the decline in international travel,3 and travel in Europe returned thanks to cheap tickets and expanded vaccine efforts. In the U.K., in particular, one study found “reports of record bookings for domestic trips, especially for rural locations and short-term rentals, in addition to other forms of self-catering and glamping/camping options, from tree houses to house boats.”4 

In Canada, too, optimism about travel returned: Figures there showed a 139 percent increase in spending at travel agencies and tour companies over the summer, while spending at airlines soared 366 percent and was up 51 percent at hotels compared to the year before, according to data from Moneris®.5

Digital-first takes priority in everything

Ultimately, the make-or-break factor is the quality of the entire customer journey: from research and payment to the safety of travel and the experience itself. And for today’s consumers, the best experiences are personalized with the convenience and ease of smartphone/digital capabilities—including QR codes, contactless tap and mobile wallets.

Being able to browse, buy and monitor reservations and purchases online from anywhere and on any device isn’t just the ultimate in convenience. It’s also a safer way to operate in these uncertain times, when limiting the surfaces we touch and direct contact is paramount. It’s no surprise that 56 percent of consumers said they will leverage contactless payments more frequently while traveling,6 including e-commerce.

This need for a safe, contactless experience creates a challenge for booking platforms, travel operators, hotels and merchants of all sizes. Larger firms have the capital required to upgrade tech infrastructure and modernize their apps and payments offerings. Online mapping that provides location-based information, for example, includes hotels and room availability into its function. Many airlines are planning to implement or advance mobile touchless payments in the near- to medium-term.

But smaller companies will likely need to leverage partnerships with solutions providers to cater to consumers’ desire for a seamless digital experience. With the fierce competition for the attention of travelers and hospitality companies, advanced capabilities for browsing and checkout will be the key to success.

Already, 60 percent of online shopping carts are abandoned, usually because of friction at checkout: It’s too confusing, too slow, or too hard to complete on a phone.7 Add to those challenges increasing concerns about payment security, and it’s easy to understand why consumers often take their business elsewhere when they can’t pay easily with their method of choice. 

Soothing concerns to promote greater demand 

With these considerations in mind, the question that remains for consumers and businesses alike is what to expect as T&E recovers.

Various surveys have pointed to successful mass vaccination programs, effective testing and rigorous safety practices as critical for a travel resurgence.8 But lingering concerns aren’t just about safety. Ease and choice of payment, as well as the freedom to cancel without penalty, have become so important to consumers, they’re now making travel decisions based on these factors.

As a result, deploying new payment technology, including contactless and even wearable payments—and instituting Buy Now, Pay Later and flexible cancellation policies—is more than a necessary response to changing market conditions. It could also play a significant role in encouraging resumption of travel. 

Observers agree that merchants are responding. “Regardless of vaccination efforts around the globe underway,” observed the Merchant Advisory Group, “merchants will continue to innovate and offer competitive payments solutions to best serve their customers across all channels with which their customers choose to engage.”

Bringing opportunity to the bottom line

In travel and entertainment, as in most industries, the pandemic has accelerated trends toward personalization, increased digital fulfillment and reduced costs for businesses—as well as increased speed, convenience and safety for consumers.

Now that consumers know how easy payments can be from the comfort of their homes, they expect that touchless, digital experience everywhere.

Brands hoping to capture this business will need to offer an end-to-end experience that meets or exceeds expectations. Flexible payment policies—including acceptance of contactless payments and all card brands, in all available channels—are essential elements of that equation. 


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1 Discover, June 2021. Revenge Travel is Trending, but the Destination Price Tag Determines Where 87% of Consumers Go. Viewed 23 June 2021.

2 Transportation Security Administration, September 2021. TSA checkpoint travel numbers. Viewed 21 September 2021.

3 Passport, November 2020. Accelerating Travel Innovation after Coronavirus: SOS for a Sustainable Recovery. Viewed 13 June 2021.

4 Passport, April 2021. Travel: Quarterly Statement Q1 2021. Viewed 13 June 2021.

5 About the data: Canada Day Reopening data is based on the transaction volumes for the weekend of June 28-July 4, 2021 as compared to the same time in the year prior. Moneris spending reports
measure spending in Canada across a range of categories by analyzing credit and debit card transaction data. The figures and percentages cited are derived from aggregated transaction volumes being processed by Moneris in the applicable categories

6 Discover, June 2021. Revenge Travel is Trending, but the Destination Price Tag Determines Where 87% of Consumers Go. Viewed 23 June 2021. 

 7 IDEMIA, Aite Group, and Discover Global Network, June 2021. On-demand Webinar: Click to Pay—taking online checkout to the next level. Viewed 23 June 2021.

8 Passport, April 2021. Travel: Quarterly Statement Q1 2021. Viewed 13 June 2021.

The information provided herein is sponsored by Discover® Global Network. It is intended for informational purposes, and is not intended as a substitute for professional advice.