How travel brands can capitalize on Buy Now Pay Later

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Travel is officially back in full swing, but consumer habits have changed. Affirm’s new report, “On the Move: What Today’s Travel Trends Mean for Your Business,” touches on key market trends and explains how travel businesses can attract customers by offering payment options that meet their individual needs.

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If there’s one thing the pandemic has taught travelers, it’s that flexibility is critical. Today’s travelers not only want more options in terms of transit dates, length of stay, unique experiences, itinerary and cancellations, but they also want more payment options that meet their individual needs.

As Skift highlighted in the Travel Finance Trend from Skift Megatrends 2022, new forms of payment such as buy-now-pay-later (BNPL) are making travel more accessible and empowering consumers to act on their travel demand. suppressed. Affirm’s BNPL offering, for example, allows customers to pay for travel at their own pace, knowing exactly how much they will owe and when they will finish paying.

In its new report, On the Move: What Today’s Travel Trends Mean for Your Business, Affirm explains how travel habits are changing, new trends are shaping consumer travel decisions, and flexible payment options can help travel businesses surprise and delight customers while increasing Revenue.

While consumers are accustomed to using BNPL in retail environments, the payment method is not as prevalent among travel brands. This presents an important opportunity for market differentiation, as many travelers may put off a last-minute trip because they haven’t had time to budget in advance – especially as fears of a recession loom.

“When travelers have access to increased spending power and payment flexibility through pay-over-time options like Affirm, they are more likely to book early, spend more per transaction and book more often – which leads high conversion, loyalty and revenue,” said Geoff Kott, chief revenue officer at Affirm. “We are seeing increased demand among travel merchants within the Affirm network. For example, in the first quarter of 2022, Affirm travel sales doubled compared to the same period in 2021, with Expedia, Vrbo and Priceline among the top 10 partners by volume.

By leveraging Affirm’s network of nearly 13 million active high lifetime value shoppers, travel providers can expand their customer base, amplify product launches and promotions, and engage travelers early in the customer journey. Affirm’s proprietary signature model approves customers only for what they can responsibly afford, and transparent messaging allows them to buy with confidence. Additionally, one-time virtual cards enable shoppers to make purchases almost anywhere.

Afirm’s partnerships with American Airlines, Priceline, Vrbo, Delta Vacations and Expedia, among others, to offer BNPL illustrate its strong position in the BNPL market. “There are so many pieces that go into providing the best deals and options for our customers,” said Maryellen D’Aiuto, vice president of digital marketing at Priceline. “Affirm fits this perfectly by helping us provide another option for payment flexibility. It opens up an opportunity for customers who might not have been able to make that trip or be there for a certain moment to have a chance to do that.”

“The trip is in high demand this year. During the 4th of July alone, Affirm’s total number of transactions doubled and airline purchases tripled, compared to the same period a year ago. We strive to empower consumers to take control of their finances so they can book travel and pay over time at a rate that works best for them,” added Kott. “With Affirm, consumers can make travel purchases with confidence, with the total cost of their purchase shown up front, with no late or hidden fees to worry about. In turn, businesses can convert browsers into buyers without relying on customer acquisition discounts – an increasingly important factor in a high-inflation business environment.”

Download Affirm’s report to learn more about:

  • How travel behavior is changing in 2022 and beyond
  • Why flexible payment options are essential for today’s traveler
  • Four trends shaping consumer travel decisions today
  • How businesses can benefit from pent-up demand for travel

This content was created in collaboration by Affirm and Skift’s brand content studio, SkiftX.

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