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6pc of consumers have used mobile device to buy airline tickets: study

June 20, 2012

Mobile is in the hot seat for airline booking

Although only six percent of consumers have bought airline tickets via mobile in the past year, 58 percent of travelers would be interested in using a tablet or smartphone to pay for future trips, according to a new study from WorldPay.

WorldPay commissioned the “Perfect Passenger Payment” report and found that consumers are willing to buy big-ticket items such as tickets via their device. The study included global insights from 4,500 consumers in nine countries including the United States, Britain, Japan, China and Brazil and from 51 airline merchants.

“One of the stand-out findings of the study is that mobile payment presents a new revenue opportunity for airlines,” said Philip McGriskin, chief product officer at WorldPay, San Francisco.

“In developing economies, mobile is already establishing itself as a primary channel for purchasing goods and services ahead of more mature ecommerce markets like the U.S. and Britain,” he said.

“However, to exploit the opportunities in these markets, and as established economies become ever more device-savvy, it will be important for airlines to make the most of this growing opportunity and look at ways to allow consumers to not only use a mobile to purchase a ticket but throughout the airport-to-flight experience.”

Book on mobile
Thirty-nine percent of the WorldPay study’s participants said that they were comfortable buying via their mobile phone.

Additionally, 50 percent of survey respondents said that they would buy via mobile if the technology was currently available, showing the gap between consumer expectations and how airlines are offering to consumers. WorldPay’s study found that ten percent of airlines offer mobile payments to users.

Thirty-eight percent of survey respondents said that they would be comfortable storing their payment information to speed up the check-out time in the future.

Chinese users are particularly prone to mobile payments with 34 percent of users saying that they had bought a flight via their devices in the past 12 months.

Seventy percent of U.S. users prefer to pay via a credit card online.

The study also found that 84 percent of carriers expect to offer consumers more ways to buy tickets in the future, which includes mobile.

“By its very nature, it can be easy to think of mobile payments as a simple extension of ecommerce. The reality is that mobile payments present the opportunity to deliver a fundamental shift in the way that airlines do business,” Mr. McGriskin said.

“From taking payment for excess baggage from passengers in the check-in queue using mobile devices, to the concept of mobile sales representatives who can approach passengers with value-added opportunities such as car hire in the departure lounge,” he said.

“If merchants can cater for consumers’ mobile payment preferences, airlines will be able to pursue and capture new revenue streams, and it can also be a way for them to defend their bottom line against competitors.”

Customer is always right
According to WorldPay, although consumers might be requesting more services and options, airlines are not necessarily listening.

For example, 39 percent of airlines said that they consult consumers on the booking experience, and 43 percent of consumers do not request any feedback on the purchasing experience.

Only 30 percent of improvements to an online booking service come via customer feedback, showing how many airlines are not taking consumers’ experiences to create a more seamless online presence, which can be deadly in a consumer-first mobile world.

When it comes to why a consumer drops out of booking online, 42 percent of users said that they were only browsing online, which shows how marketers need to better target consumers with more relevant deals.

Consumers are also heavily comparison shopping online with airline tickets, according to the study.

Thirty-six percent of users abandoned an airline’s online site because they found a better deal elsewhere. The same percentage of users also dropped out after finding expensive surcharges.

“Competition in the airline industry is growing by the day, and carriers invest millions in attracting customers to their sites,” Mr. McGriskin said.

“However, the report found that a quarter of these potential passengers are lost before they complete a transaction,” he said.

“In order to tackle this, airlines need to focus on tracking the customer journey through their site and encouraging feedback from their customers, not just capturing complaints. Without knowing at which point customers abandon the purchase, any improvements made will be guesswork at best.”

Final Take
Lauren Johnson is editorial assistant on Mobile Commerce Daily, New York

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