“Revenge travel.” That’s what they’re calling it as the cooped-up millions finally find the nerve to board planes, book hotel rooms and get back the travel mojo COVID-19 stole from us.
Travel bookings, from airplanes to Airbnb, are recovering, and 2022 stands to be the first true connected economy summer season in history as we take new digital habits on the road.
Recall how bleak it all looked. “I think in 2020, we saw an 84% drop in the amount of spend on travel. A very, very dramatic fall,” Jeni Mundy, global senior vice president of merchant sales and acquiring at Visa, told PYMNTS’ Karen Webster.
“All of us, having lived through 2020 and 2021, we know how little we did travel, and we can definitely see that coming through in the Visa statistics,” she said.
“Even in 2021, when we started to get out there a little bit more, travel was particularly constrained to mainly domestic, particularly in the U.S. where you are blessed with a very large country to travel in. We saw a lot of road trips in the U.S.,” she said.
“If people could avoid flying, then we were avoiding flying,” she added.
Not so anymore. As Mundy said, “Now that we feel that we’re out more and we’re vaccinated and living with this, I think people are now traveling more. We’re excited to get back out there and travel. We’re excited about our summer holidays. We feel like we’ve earned one.”
Recounting the refund and chargeback tsunami that hit travel suppliers and card networks hard in the summer of 2020, the remaining reluctance to get on a plane is “nothing like the…complete stop that we saw a couple of years ago,” she told Webster.
“I think the travel industry is nothing if not resilient, and very optimistic about this summer. There are teething issues as they get back up to speed. It is frustrating, but we [as consumers] need to bear with it. As business travelers as well. I’m in Dublin today, I flew in this morning. I think business travel is also starting again, albeit hopefully at less of a frenzied pace.”
As travelers return to cool cities and overseas hotspots, they’re encountering a massive digital shift that promises to make trips — for business or pleasure — safer and easier than ever.
See also: Kickfin, Visa Team on Real-Time Tip Payouts for Service Industry
Can’t Touch This
With data from the Visa International Travel (VISIT) platform concluding that “current trends in international travel suggest that getting back to pre-pandemic levels of travel could be closer than the aggregate numbers alone suggest,” tourists will likely find touchless where they go.
She said Visa is seeing “a dramatic increase…in contactless payments. They make up now, in the U.S., 20% of all face-to-face payments. Brazil has gone from 5% to 24%. We’ve seen contactless limits rise in many countries, particularly in Europe. We’ve seen like a billion more contactless transactions — taps if you like, or waves — across Europe in the last couple of years.”
Digital transformation is altering every experience, from paying the local merchants to air carriers and hospitality firms now bracing for a summer they haven’t seen in years.
“Different business models have emerged through this, and they’re not going away,” Mundy said. “We can see that in our data. These new habits that we have are staying.”
“While we are getting back out there, we are doing more things face-to-face again, and we’re back to levels that we were [at] in 2019,” Mundy said. “We’re paying more with contactless, and our online habits are not dropping back at all. They’re being lifted. We’ve changed the way we’re living.”
So much for digital doomsayers who thought contactless payments and other innovations of the pandemic era would fade out with COVID-19. Mundy said Visa is seeing the opposite.
Not only are more people traveling more often, but they’re finding new ways to spend that weren’t possible the last time they boarded a plane.
“You can travel on many airlines now and you can order effectively online in your seat,” Mundy said. “You don’t have to get anything out to pay at all. It’ll just be delivered to you. Those are sort of card-on-file solutions.”
“We’re seeing different forms of technology being adapted through the travel industry that’s really playing into the same space now that our habits have changed, they’re also changing the way that they’re serving us,” she added.
Convenient prepaid self-serve purchases made before boarding and delivered to one’s seat frees up air crews while making new ways to pay a part of the travel experience.
See also: Agoda Teams With Visa for No-Interest Credit Card Installments for Travel
Virtual Cards, Actual Business Trips
Many still wonder about the recovery of corporate travel, particularly after the world learned to conduct business at a distance for over two years, calling T&E cost into doubt.
From its vantage, Visa is seeing more adoption in virtual cards that are ideal for business travel and may hold the cost control key to making companies comfortable with the expense again.
Mundy said: “One of the other areas that we see growing is the virtual card. This is the B2B virtual card. We as consumers may well use an online travel agency to book our holiday, our flight, our hotel. Those online travel agencies are using virtual cards to pay for those.”
She added that employers can issue virtual cards with fixed spend limits and categories to better control corporate travel costs and start to bring it back at scale.
“We’re seeing these virtual cards now becoming more and more used,” she added.
Elsewhere in the travel sector, tipping is a vital source of income for hospitality workers, and it’s making the digital shift away from its cash-heavy root.
Mundy told Webster: “Increasingly, we’re seeing digital tipping applications now being used or being built into the payment experience. London taxis is a great example for that, where in a London taxi now you pay by card, you get a tip option, and it’s all contactless.”
“We’re seeing these formats now really getting built in, and I think that’s great to see that technical innovation happening,” she said.
Webster noted that as much digital transformation as we’ve undergone, the travel sector still has many opportunities to integrate with the larger connected economy — and it is.
Mundy shared how she was recently able to remotely check-in to a hotel without going to the front desk, filling out forms and waiting in lines. That’s the connected economy in action.
“I don’t necessarily want to speak to someone at the front desk,” she joked. “Speed into the hotel is important, particularly at certain times of day. Because hotels know that we are confident as consumers to use these kinds of applications, they are starting to offer it more.”
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