Another day, another insightful piece of travel research that throws light on what's causing a furore in the industry. This time, the research comes courtesy of B2B travel payment specialists, eNett International, who have found that the growing consumer demand for exotic travel destinations is causing agents to struggle under the weight of managing multiple currencies and exchange rates.
The study, conducted by Phocuswright on behalf of the payment solutions company, showed a clear rise in the number of European travel agencies currently accepting payments in over 10 currencies. In just three years, the number has grown from 6% to 12%. If more than 10 sounds like a strain, spare a thought for the 6% of agencies that are pushing the boat out further to cater to increasingly adventurous travellers and consequently dealing with more than 50 currencies.
So, what does this mean for your travel agency? Well, first of all, tourists are choosing to fly further afield with MasterCard's Global Destination Cities Index revealing that far-flung cities in the Asia-Pacific region have experienced a rise in popularity since 2015 with those in the Middle East, Africa and Latin America not too far behind.
However, the cloud to this silver lining comes from the extra administration costs, foreign exchange and border fees that agents are dealing with as they venture into foreign markets. In fact, the high margin incurred by some international payments have actually been known to put agencies off offering these sorts of adventurous trips. But is it good business to ignore what the consumer wants? We think not.
In his statement, as reported by traveldailymedia.com, eNett CEO and MD, Anthony Hynes, urged travel agencies facing such a dilemma to 're-examine cross-border payment strategies' and embrace alternative payment solutions that are more effective and in-line with the types of trips consumers are currently booking. Citing local funding and settlement and real-time conversion, which helps protect agents from unfavourable FX fluctuations as possible options for travel businesses to explore, Hynes reassured travel agencies that there are solutions which simultaneously allow them to cater to growing consumer demand whilst additionally keeping costs manageable.
When faced with a business dilemma, sometimes it pays to look to technology to step in and save the day. Contact Digital Trip to find out about how our travel technology platform can help you provide your customers with a variety of currency options with easy conversions, designed to make your life easier.