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Payments Orchestration in Meeting Travel Business Complexity

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d-md-inline">&nbsp;|&nbsp;</span> <span class="small muted text-uppercase d-block d-md-inline">November 7, 2024</span> </div> <div class="col-6 text-end my-auto"> <!-- <span class="d-none d-sm-inline">Share:</span> --> <a href="https://www.facebook.com/sharer.php?u=https://www.pymnts.com/travel-payments/2024/payments-orchestration-plays-major-role-in-meeting-travel-business-complexity/&amp;t=Payments+Orchestration+Plays+Major+Role+in+Meeting+Travel+Business+Complexity" title="Share on Facebook"><i class="bi bi-facebook me-1 text-dark"></i></a><a href="https://twitter.com/share?text=Payments+Orchestration+Plays+Major+Role+in+Meeting+Travel+Business+Complexity -&amp;url=https://www.pymnts.com/travel-payments/2024/payments-orchestration-plays-major-role-in-meeting-travel-business-complexity/" title="Tweet This Post"><i class="bi bi-twitter-x mx-1 mx-1 text-dark"></i></a><a href="https://www.linkedin.com/shareArticle?mini=true&amp;url=https://www.pymnts.com/travel-payments/2024/payments-orchestration-plays-major-role-in-meeting-travel-business-complexity/&amp;title=Payments+Orchestration+Plays+Major+Role+in+Meeting+Travel+Business+Complexity&amp;summary=&amp;source=" title="Share on LinkedIn"><i class="bi bi-linkedin mx-1 mx-1 text-dark"></i></a><a href="mailto:?subject=Payments Orchestration Plays Major Role in Meeting Travel Business Complexity&amp;BODY=I found this article interesting and want to share it with you. Check it out: https://www.pymnts.com/travel-payments/2024/payments-orchestration-plays-major-role-in-meeting-travel-business-complexity/"><i class="bi bi-envelope-fill ms-1 me-0 ms-1 me-md-1 text-dark"></i></a> <span class="d-none d-md-inline">&nbsp;|&nbsp;</span> <span class="d-block d-md-inline"> <button class="d-none d-lg-inline-block noHover audioPlay border-0 px-0 article-play-button fw-normal py-1 my-0" type="button" value="Play"> <i class="bi bi-play-circle-fill mx-1 text-dark"></i></button> <button class="d-lg-none noHover audioPlay border-0 px-0 article-play-button fw-normal py-1 my-0" type="button" value="Play"><span class="listenToArticle small text-uppercase"></span><i class="bi bi-play-circle-fill text-dark mx-1"></i></button> <button class="noHover audioPause border-0 px-0 article-pause-button py-1 my-0"><i class="bi bi-pause-circle-fill text-dark mx-0"></i></button> </span> </div></div> </div> </div> <div id="video-embed-2288278" class="video-embed left relative sec-feat mb-3"> <div style="position:relative;overflow:hidden;padding-bottom:56.25%"><iframe src="https://cdn.jwplayer.com/players/JmcRbjPY-YrbGYzGZ.html" width="100%" height="100%" frameborder="0" allow="autoplay" scrolling="auto" title="Episode | The Digital Shift | CellPoint Digital | Kristian Gjerding" style="position:absolute;" allowfullscreen></iframe></div> </div> <div class="mb-3"></div> <div class="post-feat-text"> </div> <!--post-feat-img--> <div id="pymnts-content2288278" class="single lh-article mt-1 lnk-article"> <p><span data-preserver-spaces="true">Airlines run on two things: schedules and exceptions to those schedules.</span></p> <p><span data-preserver-spaces="true">For the <a href="https://www.pymnts.com/tag/travel/" target="_blank" rel="noopener">travel</a> industry, building the plane </span><span data-preserver-spaces="true">itself</span><span data-preserver-spaces="true"> represents a more straightforward, even simpler, exercise than getting it into the air and landing it smoothly.</span></p> <p><span data-preserver-spaces="true">To ensure reliable travel — aligning schedules across global time zones, managing real-time disruptions, coordinating with airports, handling passenger service — the travel industry faces the unpredictable.</span></p> <p><span data-preserver-spaces="true">Weather disruptions, delays, maintenance issues, shifting fuel costs, unexpected crew shortages, and changing government regulations are all compounded by the logistical challenges of passenger management across languages, cultures and customs.</span></p> <p><span data-preserver-spaces="true">Against this backdrop, the legacy systems many airlines still rely on are proving inadequate in an industry where complexity and consumer expectations are rising, </span><a class="editor-rtfLink" href="https://cellpointdigital.com/" target="_blank" rel="noopener"><span data-preserver-spaces="true">CellPoint Digital</span></a><span data-preserver-spaces="true"> CEO </span><a class="editor-rtfLink" href="https://www.linkedin.com/in/kristiangjerding/" target="_blank" rel="noopener"><span data-preserver-spaces="true">Kristian Gjerding</span></a><span data-preserver-spaces="true"> told PYMNTS. At the center of streamlining operations </span><span data-preserver-spaces="true">lies the role of</span><span data-preserver-spaces="true"><a href="https://www.pymnts.com/tag/payments-orchestration/" target="_blank" rel="noopener"> payment orchestration</a> as a strategic asset for airlines.</span></p> <p><span data-preserver-spaces="true">According to Gjerding, airlines and their payment systems, in particular, are at a crossroads, faced with the dual pressures of growing passenger volumes and complex operations.</span></p> <p><span data-preserver-spaces="true">“Historically, airlines have sought profitability by increasing <a href="https://www.pymnts.com/tag/checkout-conversion/" target="_blank" rel="noopener">conversion</a> rates and reducing costs,” he said.</span></p> <p><span data-preserver-spaces="true">However, as consumer expectations shift and the payments become more varied, airlines are beginning to see payments as a revenue driver. This has led early adopters in the industry to consider moving from external service providers to internal, platform-based payment orchestration systems.</span></p> <h2><strong><span data-preserver-spaces="true">Better Payments for the Travel Industry</span></strong></h2> <p><span data-preserver-spaces="true">Payment orchestration allows airlines to use payments as an asset, delivering returns on the flow of money handled daily, Gjerding said. By integrating payments, airlines are seeing opportunities to increase ROI and efficiency.</span></p> <p><span data-preserver-spaces="true">Payment orchestration platforms like CellPoint can improve airlines in three areas: financial returns, operational efficiency and customer experience.</span></p> <p><span data-preserver-spaces="true">Financially, orchestration platforms boost conversion rates and reduce costs; operationally, they simplify payments — a critical need for airlines that process millions of transactions daily across B2C and B2B channels.</span></p> <p><span data-preserver-spaces="true">With features tailored to airlines, CellPoint’s platform allows companies to streamline back-office operations and reduce time to market for new solutions, Gjerding said.</span></p> <p><span data-preserver-spaces="true">Payment orchestration allows passengers to easily navigate <a href="https://www.pymnts.com/tag/digital-transformation/" target="_blank" rel="noopener">digital channels</a>, regardless of the device or service they use, he said. A smoother, more accessible payment process enables airlines to enhance customer engagement directly, reducing reliance on more third-party channels.</span></p> <p><span data-preserver-spaces="true">Gjerding said he believes integrating multiple payment options through an orchestration platform can be a game changer for airlines. For example, buy now, pay later options might be viable in some markets but risky in others due to fraud concerns. The orchestration platform <a href="https://www.pymnts.com/tag/automation/" target="_blank" rel="noopener">automates</a> and simplifies this decision-making process.</span></p> <p><span data-preserver-spaces="true">Using data from billions of dollars in transactions across various markets, CellPoint offers clients a model that predicts conversion ratios based on different payment scenarios, helping airlines refine their payment offerings.</span></p> <h2><strong><span data-preserver-spaces="true">The Offer-Order Model</span></strong></h2> <p><span data-preserver-spaces="true">An evolution in airline commerce is the “offer-order” model, which reimagines how travelers buy services. Traditionally, airline bookings followed a linear process. With the offer-order approach, airlines can now emulate an eCommerce shopping experience, allowing travelers to build a travel package in a single transaction. This model lets passengers select flights, accommodations and ancillary services in a flexible shopping basket, much like an Amazon cart.</span></p> <p><span data-preserver-spaces="true">While the offer-order model offers upsell opportunities, it also </span><span data-preserver-spaces="true">adds complexity to</span><span data-preserver-spaces="true"> the payment process, especially regarding partial refunds and reconciliation. Orchestration platforms are crucial for supporting these advanced workflows and integrating with core airline systems, allowing them to handle complex transactions and offer seamless experiences across various touchpoints, from mobile apps to airport kiosks, Gjerding said.</span></p> <p><span data-preserver-spaces="true">When it comes to implementing payment orchestration, Gjerding recommended a step-by-step approach. He advised airlines to initially focus on improving conversion rates and reducing costs in their existing payments before advancing to more complex, revenue-generating use cases.</span></p> <p><span data-preserver-spaces="true">For airlines beginning their journey with payment orchestration, he stressed the importance of defining clear objectives early on.</span></p> <p><span data-preserver-spaces="true">“Map out your value creation,” he said, as this initial assessment will guide subsequent technical and operational choices.</span></p> <div class="pymnt-cbfbddc6c2eac81ec59218315ca7edfc pymnt-bottom-of-article" id="pymnt-cbfbddc6c2eac81ec59218315ca7edfc"></div> <div id="bottom-ad"> <div data-pymnt-trackid="2020540" data-pymnt-trackbid="1" class="pymnt-target" id="pymnt-229786031"><a data-no-instant="1" href="https://www.pymnts.com/monitor-edge/" rel="noopener" class="adv-link" target="_blank" aria-label="PYMNTS-MonitorEdge-May-2024"><img 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