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Are you prepared for the ‘mobile wallet’? (23.06.2011)

September 25, 2011

(Published in TTG 23.06.2011)

Are you prepared for the ‘mobile wallet’?

Agents must always keep up with customers’ demands and habits, and two new reports from Amadeus reveal that when it comes to booking travel, their demand for mobile services is set to rocket.

Two new global studies commissioned by GDS giant Amadeus highlight how the aviation and hotel sectors should look to mobile to grow revenue over the next five years, following soaring growth in the way smartphones are used in the customer’s “travel lifecycle”.

The reports, The always connected traveller for the air sector and Transform your growth strategy now for the hotel sector, both predict that enhancing mobile technology for business will be key to fully exiting the recession.

Travellers are beginning to expect, demand and adopt mobile services, the first report says, with 16% of 3,000 travellers surveyed in one airport saying they had used their smartphones to book flights. The figure rose to 18% for the 18-35 age group.

For the hotel sector, Google statistics reveal 19.5% of hotel search queries are now performed on a mobile device, while there has been 74% growth in mobile bookers from 2010 to 2012.

Meanwhile, figures from iSuppli Corp show that over 73% of the world’s population – which equates to five billion people – now carry a mobile device of some form.

So should agents in the UK be thinking more about establishing a mobile channel?

Themes to emerge from the aviation and hotel sectors included time-saving, brand loyalty and the “mobile wallet”.

The reports argue that establishing a mobile channel can help travel companies manage the use of staff time more efficiently, as mobile technology “helps reduce the need for informational questions” – in aviation, this translates into fewer questions about gates, departure times, and airline policies.

Brand loyalty comes about through “ubiquitous connectivity” as travel companies are able to continuously interact with customers throughout the travel lifecycle.

The “mobile wallet”, meanwhile, is coined an “emerging innovation”. The reports predict that within three years, more people will be using their phones to make payments.

However, globally it seems the UK is playing catch-up with the rest of the world. There is a particular drive from emerging markets, where the mobile wallet is already seen as a secure, long-term replacement for cash. In Africa, mobile wallets compete with cash rather than with credit cards, and for one major airline there, the report says mobile is in fact the main form of payment for electronic transactions.

In interviews with nine major airlines, most said basic mobile functionality such as schedules, check-in and disruption management were part of their existing offer. However, Asian and American carriers provide virtually all of the 12 mobile services classed as “basic functionality”, while European and Latin American airlines preferred to “focus on only a select core of services”.

“Mobile continues to shake-up how companies interact with and meet the needs of customers,” said Julia Sattel, Amadeus’s vice-president, Airline IT.

So while the UK may be less advanced than other countries when it comes to mobile habits, travel companies should take note of these growing global trends, and prepare to keep pace with ever-changing customer expectations.

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