The Travel Landscape 2020

08 Jul, 2020 . 4 minutes



Let me take you back to January 2020…

The year started with optimism and trading levels were up across the board, holidays booked, events and weddings planned and travel businesses seemed set for record sales. The Institute of Travel and Tourism kickstarted the year on the 8th January with their monthly networking event at O'Neill's on Wardour Street, London. The event was very well attended and the Travel Landscape overview of 2019, delivered by the Institute of Travel & Tourism (ITT) Chairman Dr Steven Freudmann, gave those people in the room a feeling of positivity, and every reason to anticipate that 2020 was going to be a great year for the ITT members and the wider travel industry!

Then, further down the line in January, an alarming new virus was being reported in the news from Wuhan, China. Then on January 20th, China reported a third death and more than 200 infections, with cases also reported outside Hubei province including in Beijing, Shanghai and Shenzhen. This, as we all now know, would become known as COVID-19 (Coronavirus). Ten days later on January 30th, the World Health Organisation (WHO) declared Coronavirus a global pandemic as the death toll in China jumped to 170, with over 7,500+ cases reported in the country, where the virus had spread to all 31 provinces. By the end of the week, China reported 304 deaths amid circa 15,000 infections.

Within a few days, new cases were confirmed in Spain, India, Sweden, United Kingdom, Russia, Australia, Canada, Germany, Philippines, Japan, Singapore, USA, Vietnam and UAE. Fast-forward to April 6th, our UK Prime Minister Boris Johnson was moved into intensive care as his condition worsened after being hospitalised in London with persistent COVID-19 symptoms. He was released from intensive care on April 9th and was discharged from hospital on April 12th.

During those 4 months (Jan-Apr), the travel industry saw local and global travel slow to a standstill with only cargo and medical care being allowed to operate globally. With multiple countries closing their doors to contain this horrible, ever-present, and seemingly untreatable virus.

Here’s where the ray of light starts to shine for the travel industry…

On 8th June 2020, New Zealand reported that they were completely Coronavirus free and that the majority of restrictions were to be lifted. Furthermore, life had begun to return to what we used to call “normal” in various arenas including hospitality, sports and travel. So, what does this mean for the rest of the world, including the UK?

The UK travel industry has started to see encouraging signs of European and International travel slowly either re-opening, or considering re-opening in the not too distant future. This means future bookings for Winter 2020 sunshine and 2021 bookings, which people have either deferred or are treating themselves to, after enduring these testing and unprecedented times.

Flights between European Countries and internal flights have started to resume, albeit with new pre, during and post flight safety measures now in place. 2020 was expected to be the Cruise sector’s strongest year for incremental growth however this was not the case given the significant challenges that Covid-19 brought to the industry. Through stringent safety measures that have deployed across the sector which has allowed some cruises to resume and this combined with consumer confidence, has provided a resurgence in future bookings.

How have some of the sectors and travel industry responded?

Airlines

About two-thirds of the global fleet (circa 15,000) aircrafts parked up at airports around the world, according to consultants Ascend by Cirium. Therefore, with major events and trade shows for the foreseeable future at the risk of not commencing, what options do airlines have to encourage people to fly safely from late 2020 into 2021?

Creative pricing strategies; for various flight classes such as Business class are being offered at reduced rates to give people additional luxury but keeping plane capacity limited to re-coup economy seats costs. Subsidised or reduced fees for airport lounges; to keep COVID-19 measures in check and reduce numbers of passengers in the main terminals.

Inflight Purchases for airport collection; a number of aircrafts now have on-board WIFI which, with the incentivised through offers and competitive pricing, combined with a simple checkout process, could lead to increased in-flight purchases and seamless collections at either departure or arrival terminals.

Travel Agents

“We’re really excited to be talking about taking people on holiday again," said TUI Managing Director UK and Ireland Andrew Flintham.

"We’re of course still waiting on the government to change its travel advice, but we’ve been working really hard behind the scenes and we’re ready to start taking holidaymakers away again in just a few weeks’ time," Flintham said the operator was focusing initially on destinations where it anticipates air bridges being agreed. "We know many Brits are eager to travel again, and we have ambitious plans to rapidly increase our programme as soon as possible," Flintham added.

Institute of Travel and Tourism

Dr. Steven Freudmann, Chairman, Institute of Travel & Tourism, says: “During Coronavirus, ITT has continued to communicate with its members and we understand the new challenges that lie ahead for all of the travel sector. We will continue to work with our partners and members to ensure key information and best practices are shared amongst the ITT community.”

ABTA

Mark Tanzer, ABTA’s Chief Executive, says: “We must restart international travel as soon as it is safe to do so, and businesses and customers would benefit from the Government outlining when this is likely to happen. There are many livelihoods at stake, and bookings will only start to pick-up in earnest when people and businesses have a better idea as to what the Government’s plan is to open up the UK and access to international destinations. This is going to take a coordinated approach, and ABTA will continue to do whatever it takes to assist with this process on behalf of travel agents and tour operators across the UK who are desperate for a clearer direction for travel.

“Of course, safety must absolutely come first, which is why the Government also needs to set out clearly the relevant scientific advice and epidemiological factors informing decisions, including the quarantining policy before its review in three weeks.”

Travel Insurance

Malcolm Tarling, spokesman for the Association of British Insurers (ABI), said: "Given the fast-moving travel situation, insurers are monitoring developments closely, to ensure that as the situation improves, this can be reflected in the scope of cover, and availability of new travel policies being offered."

How can APEXX help the Travel Industry?

We are confident that at APEXX, our modern payment orchestration layer will deliver in four key areas:

1. Helping travel merchants review and replace their current gateway with a modern payment orchestration layer capable of dynamic routing and cascading transactions to maximise acceptance rates, with a typical uplift in acceptance of 5-10% in total. APEXX would provide Travel merchants a single integration point to access an array of alternative forms of Payment (APM) providers (such as Avarto, Klarna, ApplePay, GooglePay), a section of fraud solutions through a simple API connection and, finally, a choice of payment service providers and acquirers for the UK, Europe and for future international expansion. This single point of access would provide access not only to the provider(s) that Travel merchants utilise today, but also to any future payment provider, removing the burden of future integrations and development work and increasing speed to market.

2. Enhanced omni-channel refund processes, by removing the need of manual paper-based systems, which covers e-commerce, telephony and card-present transactions. This can all be managed via APEXX’s consolidated reporting across all payment providers. APEXX consolidates the data from all of your payment providers into one interface, which aids reconciliation and allow you to accurately benchmark performance by provider. Through our collaborative approach, APEXX Global will customise the format of the master reconciliation report, which would be agreed as part of our engagement to ensure it meets the travel merchant’s specifications and requirements.

3. In addition to the technical benefits mentioned above, the APEXX team would support Travel merchants in the continued optimisation of its payment eco-system, including the identification and presentation of new acquirers, payments providers and fraud solutions (as appropriate), for Travel merchants’ consideration and by leveraging APEXX’s economies of scale to ensure the best commercial arrangements are secured for merchants within the Travel Industry.

4. Aiding and assisting Travel merchants implementing their Payment Services Directive (PSD2) / Strong customer authentication (SCA) strategy, by using APEXX’s payment orchestration layer to access a selection of APEXX’s Fraud Solution’s. With such implementation and continuous payment risk analysis, Travel merchants could achieve very low fraud rates and in turn, attracting additional acquirers to connect with on the APEXX platform to achieve better commercial terms.

Sources:

[1] https://www.ttgmedia.com/news/news/tui-to-restart-ex-uk-holidays-next-month-23565 [1] https://www.abta.com/news/abta-calls-government-roadmap-restart-international-travel [1] As cited Kevin Peachey article - https://www.bbc.co.uk/news/business-53023554




Sign up for the newsletter

By submitting this form, you acknowledge that you have reviewed the terms of our Privacy Statement and consent to the use of data in accordance therewith.

See how APEXX can help you grow your business

  • Single Integration
  • Acquirer Agnostic
  • Surcharge Inspector
  • Payment Methods