SAN FRANCISCO—Increasing revenues isn’t just about the sales you make—it’s also about the sales you don’t. SwayPay, a newly launched checkout app, wants to make it easier for hotels to capture bookings that are typically abandoned.
Lacking the marketing dollars of online travel agencies and large hotel brand companies, it’s much more difficult for independent hotels to get customers to their websites. And when they do, according to SwayPay, they only see a 3% conversion rate, resulting in some $446 billion in losses from abandoned checkouts.
Mark Pulliam, SwayPay’s chief commercial officer, who recently made the move from Sabre, reflected on the distribution landscape of the hospitality industry. “One of my colleagues told me consumers will want to shop where they want to shop, and they’re going to buy where they want to buy,” he said. “Despite all the great technology that the technology providers are doing, things like urgency triggers or in-context booking engines, adding video and loyalty programs to drive traffic to independent hotels or to hotel.com, hotel.com is losing the battle against the OTAs. As we experience this continued growth in online e-commerce, the OTAs are continuing to gobble up more share. Why is that? It comes down to—despite the most beautiful-looking booking engine a hotel can have and all the digital marketing spend at the hotel website—people continue to use metasearch, TripAdvisor, Expedia; they do a lot of shopping.
“The booking engine presentation is important, the digital marketing is important, but, at the end of the day, people are still abandoning at the shopping cart, and I believe it’s because that experience of checking out is extremely difficult,” Pulliam said. “Where do they abandon the booking? Right when they see the total price, they’re asked to put in payment details or they start to go through the checkout process. It’s a real pain to put in all your credit card information, to put in your name, your number.”
Enter SwayPay. “SwayPay is not a payment processor; it is not a payment gateway,” Pulliam said, noting that hotels do not have to change anything about their current technology providers in order to use it. “It provides an experience for the consumer online at hotel.com to pay and check out effortlessly, removing all of the frictions.”
The first time a consumer downloads SwayPay, the process takes one minute—though Pulliam said that the company is working to get that down to 45 seconds—and every time thereafter, the checkout process takes 12 seconds. “If they hit the pay with SwayPay option, immediately their mobile phone gets a push notification saying ‘confirm your purchase,’” Pulliam explained, adding that for smartphone users, the payment will be biometrically secured via fingerprint or facial recognition. For phones without these security features, the user types in a code.
“That’s it,” Pulliam said. “All of that backend filling out forms is gone. You complete the transaction in 12 seconds effortlessly.”
SwayPay completes the transaction in 12 seconds.
With any technology—but particularly technology related to payment—security is critical. “We have patent-pending, PCI-compliant technology that’s virtually breach proof,” Pulliam said. “Think of the SwayPay mobile app as a digital wallet—it’s a lot more than a digital wallet, but you keep your forms of payment in that wallet. Half of the information is encrypted and stored on the phone, and the other half is on the SwayPay servers. At the time of transaction, half of that information from the phone is going to SwayPay servers, encrypted, matched up with the other half, which is also encrypted, the payment processor approves, the payment option comes back, and it’s authorized.”
However, there’s an added level of security for hotels—the guest who booked isn’t an anonymous internet user; that guest is someone whose payment was biometrically secured. “There’s no invalid bookings holding inventory in your system when it’s done through SwayPay,” Pulliam said. “On most booking engines, you can put in 16 digits, send it off and hold inventory, and it really messes with your revenue management. SwayPay ensures your bookings are valid, you’re holding inventory for real people, and the card has the necessary credit limits to support the transaction. That security is really important as well, and it enhances revenue management.”
Hotels can also offer discounts and upsell opportunities if they wish to. “It makes it a very clean presentation to the end consumer that they are getting the best deal,” he said.
SwayPay utilizes all forms of payment. “Is your website as smart as your mobile phone? If I have Android Pay, Apple Pay, PayPal on my phone, how many independent hotel websites will accept Android Pay? None that I’m aware of,” Pulliam said. “We can bring all of those emerging forms of payment into the process, and the hotelier doesn’t have to do anything.”
Hotels can also choose to limit forms of payment. “If they don’t want to accept American Express, we can suppress American Express; the hotelier doesn’t lose control of what forms of payment it wants. We just open up the entire world of payments to allow the hotelier to further enhance the guest experience by allowing the guest to pay with whatever means they want to pay,” he said.
One additional option for guests is instant financing for purchases over $500, which the company expects to bring to market in the near term. “If hotels want to offer instant financing, they’ll be able to do that over mobile and get the authorization back within seconds,” Pulliam said. “The hotelier gets paid up front and the end guest is making payments to the lending institution.” Pulliam noted that this could be a good option for guests looking at booking a more expensive trip, such as a stay at a wellness resort, where costs are typically very high.
Pulliam noted that the payment model will be “a flat monthly fee with a high cap of transactions included in that model… And, of course, as we roll this out, the first few months will be free to try it out, or go month to month even, so if you’re not getting the results, you can get out of the contract. We’ll make it contractually easy for hotels. We believe there’s so much potential upside, and I want this company to be very easy to do business with.
“If I’m a hotelier, I don’t think there’s anything to lose,” Pulliam continued. “You don’t have to get rid of traditional payment methods. There’s not a tremendous amount of risk. These are tools I believe will make the independent hotelier in particular much more competitive, drive better margins, improve the guest experience and increase direct bookings.” HB
