Apple Pay Launched in Ireland – How The Rise Of Mobile Payment Will Affect The Hospitality Industry

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Posted by Fionnuala Bland on: 2017-03-09 14:16:38Avvio  |  Booking Engine
Mobile Payments

Apple Pay has arrived in Ireland. Consumers no longer need to dig out their wallet or credit card to pay for a product or service. They merely whip out their phone, tap and go. Over two years since it was first introduced in the USA, the technology has been a long time coming for Irish retailers.

 

How does it work?

Apple Pay and Android Pay work in the same way. Users link their smartphone to their bank account app by entering their card details, their card details aren’t stored on the phone and instead, they’re encrypted and sent back to the app. They can then be accessed using touch ID for fast, secure payments.

For customers who want to make a booking as quickly and conveniently as possible, Apple Pay and Android Pay can be a saviour. They can book a hotel room whilst on a train with minimal time and effort, and without brandishing credit cards for the rest of the train to see, or to waste time finding and typing in a long card number.

 

What does this mean for the Irish hotel industry?

The global hospitality industry has been slow to adopt the technology, but hoteliers need to keep an eye on the trend, especially as more and more Online Travel Agencies (OTAs) and other booking sites introduce the technology into their software.

OpenTable, Uber, Airbnb and Expedia, among many others, have also integrated with Apple Pay to create seamless booking and payment services. The app has over 2 million point of sale locations in the US[1].

The convenience of the service makes consumers more likely to book a reservation on impulse.

Upon implementing the technology, Priceline have found that their customers using Google Wallet have a 64% higher conversion rate than those who are not signed in via a Google username[2].

In 2014, Atmosphere Research revealed that 1 in 5 smartphone-owning leisure travellers and 1 in 3 smartphone owning business travellers had mobile wallets. 20% of those who didn’t yet have mobile wallets were interested in getting one[3]. Two years on, many business travellers would likely use mobile payment or e-wallet technology. The share of business travellers likely to use digital wallets ranges from 43 percent in the Nordic countries all the way up to 75 percent in Italy. Millennials and Gen-X travellers are much more likely than Baby Boomers to want to use mobile payments[4].

 Breakdown of Digital Wallets Globally

Having taken over the rest of the world – or at least North America, UK, Australia and China – the technology has seen great success. A report by Business Insider predicts the volume of in-store mobile payments to increase to $503 billion by 2020, rising by 80% every year[5].

Given these statistics, we can expect Irish hoteliers and other accommodation providers to quickly adopt this new technology and customers to use the app to pay for their stay, especially those hotels and serviced apartments whose demographics skew towards younger travellers and those who rely on tourism from countries where digital wallets have become the norm.

As technology advances, accommodation providers will be able to use data from on-app purchases to personalise and improve their customers’ experiences and to enhance their marketing efforts. For example, if a customer buys a cocktail at the hotel bar, hoteliers can use this data to offer the customer a complimentary cocktail upon their next stay as an incentive for them to visit again.

In any case, the hotel and accommodation industry cannot afford to ignore the rise in mobile payments. In the US, 52% of all travel bookings are made entirely or partly via mobile[6]. By 2020, consumers in the US and the UK will make more purchases on their phones than on their computers, whether via an app or website[7]. Hoteliers and other accommodation providers need to keep on top of the types of user they want to target, in order to determine whether they need to adopt mobile payment technology early. If your customer base is largely made up of millennials, who live and breathe digital, you will likely need to be more technology ready than those targeting baby boomers and older guests. Use Avvio Insights and Google Analytics to determine your core demographics and then act accordingly.

It all comes down to consumers’ online behaviours, before and during their visit. Integrating the technology with your online booking and in-house payment system will enable international customers to go through their stay without having to take out foreign currency. Their visit to your hotel and website will become seamless and stress-free. 

Mobile payment technology is just one trend to hit the travel industry this year. It’s important that you keep up to date with all the digital advances and trends due to take the industry by storm. This way, you can ensure you meet your customers’ expectations and improve their experience with your brand.

Download your free guide on Avvio’s Top Tech Predictions for Hoteliers in 2017 and keep ahead of your competitors.

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[1] New Skift Trends Report: Digital Payments in Travel 2016, Skift, 2016 (https://skift.com/2016/07/12/new-skift-trends-report-digital-payments-in-travel-2016/)
[2] Apple Pay Will Become A Standard Option for Travel Brands, Skift, 2016 (https://skift.com/2014/12/16/apple-pay-will-become-a-standard-option-for-travel-brands/)
[3] Everything you need to know about Apple Pay and the travel industry, Tnooz, 2014 (https://www.tnooz.com/article/apple-pay-travel-industry/)
[4] Business Travelers Embracing Self-Service Technology and Personalized Travel Options, GBTA Foundation, 2016 (http://www.gbta.org/foundation/pressreleases/Pages/rls_063016.aspx)
[5]THE MOBILE PAYMENTS REPORT: Market forecasts, consumer trends, and the barriers and benefits that will influence adoption, Business Insider, 2016 (http://uk.businessinsider.com/the-mobile-payments-report-market-forecasts-consumer-trends-and-the-barriers-and-benefits-that-will-influence-adoption-2016-5?r=US&IR=T)
[6] The Serviced Apartment Digital Benchmark Report 2016, Serviced Apartment News, 2016 (https://www.reviewpro.com/serviced-apartment-digital-benchmark-report/?utm_campaign=newsletter&utm_medium=email&utm_source=db)
[7] Drive Personalization During the Stay, Check-out Process with a Master Digital Wallet, Hospitality Technology, 2017 (http://hospitalitytechnology.edgl.com/news/Drive-Personalization-During-the-Stay,-Check-out-Process-with-a-Master-Digital-Wallet108762)


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