Mobile Payments Index 2016Travel edition

Mobile The next opportunity for travelThe Adyen Mobile Payments Index reveals huge growth opportunities

for travel merchants willing to invest in mobile payments.

This report draws on Adyen’s data and real-life examples to provide

practical advice for merchants looking to grow market share with

mobile payments.

The global context

In Q1 of 2016, 32% of global online payments on the Adyen

payments platform were made on a mobile device.

The iPhone and Android phones are increasing their share in

tandem, while the tablet decline is driven by the iPad, which

dropped to under 8% of mobile payment share for the first time,

with Android tablets flat lining at just over 2% over the past two

quarters. (See graph on following page).

5%

10%

15%

20%

25%

Q2 Q3 Q4 Q1

Smartphone

2015 2016

Tablet

Global split of mobile payments - Smartphone vs tablet

In terms of average transaction value, desktop and iPad are in the

joint lead.

Globalshare of mobile by device type

iPhone continues to soar and Android grows steadily, while iPad

continues to decline.

0%

5%

10%

15%

Q2 Q3 Q4 Q1

iPad

2015 2016

Android Tablet

Windows Mobile

Android Mobile

iPhone

Global device type usage per quarter

€0

€50

€100

€150

€ 44

€ 72

€ 95

€ 115 € 115

Global average transaction value per device type, Q1 2016

Android Mobile iPhone Android Tablet iPad Desktop

Travel Early movers are reaping rewards

2016 is going to be a big year for mobile travel payments; globally

mobile travel bookings are predicted to rise by 22%*.

However, despite the growing influence of mobile in the travel

industry, Adyen’s data reveals that the current share of mobile

payments remains relatively low, at 15.5%.

Mobile share for acommodation services is 17%, with an even split

between device types. Airline share is 13%, which is driven by tablet.

* Euromonitor November 2015, The State of Mobile Booking 2016 (Skift Report)0%

5%

10%

15%

% share of travel mobile payments, Q1 2016

Smartphone Tablet Smartphone Tablet

Accomodation Airlines

Mobile is already well integrated into the passenger experience. Travelers

can check in and store boarding passes on their smartphones, check flight

status and even chat with customer support. However, when it comes to

actually buying a ticket on a mobile device, there is a lot of room to grow.

While 13% might seem small compared to the global share of 32%, it is a

high percentage when considering the typically high transaction value of an

airline ticket. Further, as mobile increasingly becomes a central part of the

passenger journey, this share is bound to grow.

Airlines Reaching new heights with mobile payments

Airlinesshare of mobile by device typeGiven the typically higher transaction value of iOS users, it is no

surprise that iPad is driving mobile payments for airlines.

It also suggests that passengers still favor larger screens when

making high value purchases.

0%

5%

10%

15%

20%

25%

Global vs Airlines

Smartphone Tablet Smartphone Tablet

Global Airlines

Airlines: Mobile usage split by device type

€0

€50

€100

€150

€200

€250

€300

€350

€ 184

€ 228 € 241€ 267

€ 295

Average transaction value per device type, Q1 2016

Android Mobile iPhone Android Tablet Desktop iPad

0% 2% 4% 6% 8% 10%

iPad

iPhone

Android Tablet

Android Mobile

Industry leaders are beginning to make inroads: KLM successfully

introduced payments to its customer support on social media,

allowing passengers to complete a purchase from Twitter, thereby

making the process extremely mobile friendly. Transavia has also

embraced mobile optimization:

“To make the mobile experience easier for our

customers we designed a scalable website, and were

the first to launch Whatsapp as a service channel.

Thanks to this investment, mobile now accounts for

20% of our payments.

Brit HaarmansSenior Product Manager

Industry insight

When optimizing payments for mobile devices, it is important to

consider the passenger on the move and enable a quick and easy

payment flow, as demonstrated by SAS Airlines and Vueling:

“We have also optimized our mobile payment

experience by storing preferred payment methods

to enable instant booking. We also support e-wallets

and payment methods that allow for an easy,

one-click checkout.”

Charlotta FrohmBusiness Developer, Customer Payment Solutions

“Implementing mobile payment solutions like Apple

Pay and Android Pay enables passengers to checkout

with a single touch.”

Javier Alvarez SanchezIT Manager

Industry insight

New developments will even enable passengers to make point of

sale purchases on-board with their phones. This will enable airlines

to centralize all transactions, from flight booking, to seat-upgrades

to on-board purchases and view passenger payment history in

one place.

“The next innovation we would like to see in mobile

payments is in-app payment on-board. This would

allow passengers to pay for food and drink on-board

with their mobile, and receive a digital receipt. That

would be a revolution if we enable it in an offline

environment.”

Brit HaarmansSenior Product Manager

Industry insight

There are many exciting opportunities for accommodation services. Guests

can now browse, book, check-in and even order room service via their

smartphones. Therefore the scope for building loyalty and up-selling is

significant.

Companies like HotelTonight and booking.com are already leading the

way with a mobile first strategy. And, in order to keep up, 24%* of hotels

state they are prioritizing mobile payments this year. Consequently, we can

expect the share of mobile payments to increase significantly.

Still, with a current share of 17%, there remains a huge opportunity for

hotels and booking sites to differentiate themselves by providing a fully

integrated mobile experience to guests.

*hospitalitytechnology.edgl.com

Accommodation The new generation is leading with mobile

Accommodationshare of mobile by device typeIn terms of transaction value, iPad is in the lead, followed closely by

desktop. This suggests that there is still room for further optimizing

the experience for small screens.

Although smartphone dominates globally, when it comes to booking

accommodation, tablet retains its market share. This is likely to

change as the payment flow for smaller screens improves.

0%

5%

10%

15%

20%

25%

Global vs Accommodation

Smartphone Tablet Smartphone Tablet

Global Accomodation

€0

€50

€100

€150

€200

€250

€300

€350

€ 200

€ 254 € 262

€ 329 € 331

Average transaction value per device type, Q1 2016

Android Mobile iPhone Android Tablet Desktop iPad

0% 2% 4% 6% 8%

iPad

iPhone

Android Mobile

Android Tablet

Accommodation: Mobile usage split by device type

Industry insightWhen designing the mobile experience, it is important to

accommodate the needs of the traveler on the move.

HotelTonight recommends the following considerations:

Simplicity — instead of showing you every hotel, we show

you the top rated hotels with the very best deals. This saves

time, and is more accommodating to smaller screen sizes.

 

Speed — mobile bookers are on the go, and usually

in the midst of doing something else. Our motto is to

get you out of the app and on with the rest of your

night as soon as possible. We obsess over tap counts,

making it possible to book a hotel room in three taps

and a swipe.

Contextual Awareness — mobile devices are inherently

personal and it’s important for the content of the apps

to react to the needs of the consumer in real time. The

hotel deals we present to a booker vary depending

on where that booker is located and other factors.

This personalization increases conversion while

simultaneously improving our customer satisfaction.

Sam ShankCEO

Mobile contributes to a wider omnichannel proposition which puts

the customer experience front and centre.

Recognizing guests across sales channels eliminates the need for

them to re-enter payment details when making payments from a

different channel or location.

“With Adyen we can serve a repeat customer who

comes to our hotel every week, and ask for their

card details only once. So we provide a flawless

experience. “

Lennert de JongDirector of Distribution and Business Development

Industry insight

About the Adyen Mobile Payments IndexSince June 2013, the Adyen Mobile Payment Index has tracked

the rapid evolution of mobile as a payment channel, providing

insight into mobile payment trends for different devices and

market sectors, across selected geographies and payment

methods. The Mobile Payments Index is based on Adyen’s global

mobile web payment transaction data, and does not track in-app

mobile payments.

To get in touch, email travelpayments@adyen.com

About AdyenAdyen is a technology company that provides businesses with

a single solution to accept payments anywhere in the world.

The only provider of a modern end-to-end infrastructure

connecting merchants directly to Visa, MasterCard, and 250 other

payment methods globally, Adyen delivers frictionless payments

across online, mobile, and in-store. Adyen is headquartered in

Amsterdam and San Francisco, with offices across North America,

South America, Europe, Asia and Australia.

We work with some of the world’s biggest travel companies :

www.adyen.com