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Airtickets about to evolve

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PayU, the company that secures payments for SAA, Mango, Flysafair and Skywise, believes that airline ticket payments are set to transition over the next five years, making it even easier and safer to secure seats.

Air travel may be statistically safer than other forms, but what about the transactions that surround it?

According to Airports Company South Africa (ACSA) figures, over 9.5 million passengers bought tickets for domestic flights in 2014. In this August alone – the latest statistics available – the number stands at more than 743 thousand.

International Air Transport Association passenger numbers are predicted to reach 7.3 billion by 2034, more than double that of 2014 and 2015. China with 856 million new passengers is expected to overtake the US (559 million) in volumes with India (266 million), Indonesia (183 million) and Brazil (170 million) sitting in the top five.

These figures underscore the importance of having secure and dynamic payment systems that tap into the trends and recognise how people use technology to purchase their tickets and handle their travel.

One fraudulent transaction can cost thousands of Rands, and for the airline companies sound fraud management is essential, as this will impact on the business significantly. Air travel is a capital-intensive industry – it costs around R100k to fly from Johannesburg to Cape Town and the margins are slim. While only 8% of payments are cash-free in South Africa, that 8% is valuable and needs to be driven even higher through availability, security and ensuring trust.

“All businesses are exposed to fraud, and it can be a big issue for airline operators and the consumer,” says Kirby Gordon, Vice President: Sales and Distribution at Flysafair. “The biggest hesitation around online transactions is always around the payment system. The fear of fraud and the reality of it are daunting as our transactions are often big numbers.”

When the plane takes off, the seats leave with it. Every detail must be attended to or there is potential for both the customer and corporate to suffer either loss of funds or, for the corporate, reputation.

“When profit margins are thin and the capacity to be defrauded is high you really need a stable payment system. We are conscious that all of our payments are maintained properly so that when a flight departs, we have the funds in our account,” says Gordon.

Airline ticket purchases make up the largest portion of e-commerce transactions in South Africa. And, according to Euromonitor, the local online travel market is estimated at approximately R17.7 billion in 2015.  PayU, the company that secures payments for SAA, Mango, Flysafair and Skywise, believes that airline ticket payment is set to transition over the next five years.

“The airline industry represents a microcosm of the payments industry as a whole, with nuances and challenges around dynamic stock movement and modifications keeping us on our toes,” says Mustapha Zaouini, CEO of PayU MEA. “This will only get more intricate as the power continues to shift to the consumer and payment methods become more on-demand.”

The fast-evolving ticketing ecosystem will play a significant role in the flying experience, says Gordon. “There is a need for high level augmentation in the airline payments environment, not a standard payment gateway,” says Gordon. “In our world, modifications to bookings are a frequent occurrence – changing flights, adding a suitcase, buying an extra seat or insurance. That payment needs to be taken a second time and recorded against the first to ensure we have a complete record. It can get complicated. The next phase will be accepting in-flight payment.”

Corporate travellers commit the worst offences in airline booking with around 31-37% of reservations requiring modifications. Flysafair has led the way in unbundling in South Africa, taking the suitcase out of the net fare paid and making check-in optional. With 42% of passengers booking a bag it means that the remainder may change their mind at the last minute, impacting the transaction and the tally. While this presents challenges it also offers further opportunity.

“The trends we are seeing in mobile development are huge and are playing a giant role in how the payment industry is advancing. This means that working with a partner like PayU, one that is aware of these shifts and is prepared for them, ensures that our customer’s credit cards stay as safe as they do when they fly with us.”

Juniper Research has predicted that mobile tickets and digital ticketing are expected to take more than one in two ticket transactions by 2019. This means that payment methods such as credit and debit cards will increasingly move to digital and this demands that the security around payment needs to be completely watertight.

Africa News

Smart grids needed for Africa’s utilities

Power utilities across Africa should rethink their business models and how they manage and monetise their assets to keep pace with the changing energy ecosystem, says COLIN BEANEY, Global Industry Director for Asset-intensive and Energy and Utilities at IFS.

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Africa’s abundant natural resources and urgent need for power mean that it is one of the most exciting and innovative energy markets in a world that is moving rapidly towards clean, renewable energy sources. The continent’s energy industry is taking new approaches to providing unserved and underserved communities with access to power, with an emphasis on smart technologies and greener energy sources.

Power systems are evolving from centralised, top-down systems as interest in off-grid technology grows among African businesses and consumers. And according to PwC, we will see installed power capacity rise from 2012’s 90GW to 380GW in 2040 in sub-Saharan Africa. Power utilities are needing to rethink their business models and how they manage and monetise their assets to keep pace with the changing energy ecosystem.

Energy and utilities providers are transforming from centralised supply companies to more distributed, bi-directional service providers. They can only achieve this through the evolution of “smart grids” where sensors and smart meters will be able to provide the consumer with a more granular level of detail of power usage. This shift from an energy supplier to “lifestyle provider” will require a much more dynamic and optimised approach to maintenance and field service.

African companies must thus embrace digital transformation as an imperative. This transformation begins by embracing enterprise asset management to improve asset utilisation. The subsequent steps are enhancing upstream and downstream supply chain management; resource optimisation; introducing enterprise operational intelligence; embracing new technologies such as the Internet of Things, machine learning, and predictive maintenance; and becoming a smart utility.

Embracing mobility to drive ROI

Getting it right is about putting in place an enterprise backbone that accommodates asset and project management, multinational languages and currencies, new energies and markets, visualisation of the entire value chain, and mobility apps. Mobile technologies that support the field workforce have a vital role to play in driving better ROI from utilities’ investments in enterprise asset management and enterprise resource planning solutions.

Today’s leading enterprise asset management solutions feature powerful functionality for mobile management of the complete workflow of work orders – from logging status changes and updates, from receiving and creating new orders to concluding the job and reporting time, material and expenses. Such solutions are easy to deploy and intuitive for end users to learn and use.

Importantly for organisations operating in parts of the continent with poor telecoms infrastructure, connectivity is not an issue. The solutions work offline and synchronises when network connectivity is available. Users can work on any device—laptops, tablets, and smartphones—commercial or ruggedised.

By ensuring that field technicians have easy access to information and processes, the mobile solution enables technicians and maintenance engineers to easily do the following tasks:

·         Create a new work order on the fly and log new opportunities

·         Access both historical and planned work information when requested

·         Permit customers to sign when the job is completed

·         Capture measurements and inspection notes on route work orders

·         Create new fault reports on routing

·         Facilitate documentation through photo capturing

·         Provide easy access to technical data and preventive actions.

The power of mobility allows the engineer to be the origin of all data capture on a service event. They can easily inquire on asset history, record parts used or parts needed for repair, record labour hours, and expenses as they occur, and any notes of repairs performed. When coupled with workforce management tools, such solutions unlock significant productivity gains for utilities who are trying to get the most from their workforce and assets.

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Brands fall for app vanity

The experience of a mobile screen full of icons, representing independent apps that your need to open to experience them, is making less sense. Instead, businesses should serve customers with an ‘app-like’ experience inside the digital platform they already use, says PIETER DE VILLIERS, Group CEO at Clickatell.

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Many brands remain obsessed with creating mobile apps. This not only defies trends that point to increasing consumer app apathy, but can exclude a sizeable portion  of your customers in emerging economies. Companies need to engage with their users where they are rather than forcing them onto an app, in what can only be described as brand vanity. 

In 2017 there were around 2.2 million apps available in the iOS app store and over 3 million on Google Play. And, while the number of apps being downloaded continues to rise, analysis shows that consumers are only using 30 apps per month and accessing just 9 on a day-to-day basis. 

While these numbers still seem attractively high, in reality the majority of the apps we use are for messaging (like Facebook Messenger, WhatsApp, and WeChat) and our social networking, gaming, leisure, dating or utility activities. 

Despite the facts, the application strategy as the holy grail for digital transformation is still being pushed even within large progressive brands. What’s more, some advertising agencies and digital consultants are still pushing apps as the best means for companies to connect with their customers. This has resulted in some organisations stubbornly doubling down on app strategies which are simply not showing return on investment (ROI). 

It’s not immediately clear to us whether the fascination with apps is a roll-over from long overdue projects or whether brand owners equate a mobile-first strategy with a mobile app. Mobile-first in 2018 means customer first, and therefore embracing chat commerce in order to deliver services with convenience and simplicity in mind. 

Why apps won’t win the internet

The problem with apps goes beyond user fatigue. In the first instance, many apps are poorly designed, assuming technical sophistication which may not match reality for the average customer. Poor user interfaces and attempts to provide complex engagement can result in even the best ideas missing their targets due to lack of engagement. 

Secondly, we all know that economic realities drive consumer behaviour. In Africa, new mobile phone users typically opt for feature phones over smartphones. With a longer battery life and a much more accessible price point, feature phones still allow for a basic internet connection, chat platforms like WhatsApp, and call and message functionality. In these regions, the cost of an app – even if it’s free – goes far beyond installing it. Constant updates require reliable and cheap access to the internet. For the average phone owner in an emerging market, this can be a serious challenge. 

Thirdly, and most importantly, apps must be relevant to their intended market. Frequency of usage is a key measure of relevance. 

Apps which are used on a daily basis, like health and fitness trackers, enjoy constant engagement. New features which are added are eagerly awaited by users who are happy to update their apps. 

However, users may well question the relevance of the app if they are required to conduct updates on a monthly or even weekly basis when they are only making use of the app once or twice a year. 

On average, I download one app per quarter. Some I use more frequently than others, but all of these apps need to be regularly updated to maintain security, update features, and fix bugs. Many apps are pushing out updates much more frequently. I noticed over the past year that I could go from having all apps updated, to 32 apps requiring an update in five days.

When it comes to a customer-first digital strategy, companies should be asking themselves if an app is really the best way to reach their target audience. 

In fact, at the end of 2016, Gartner predicted that by 2019, 20 percent of brands would ditch their mobile app. What’s more, in its 2018 predictions, the company forecast that by 2021, more than 50 percent of corporations would spend more per annum on bots and chatbots than on mobile app development. 

So, we need to ask, what is the alternative for CIOs, CDOs, CMOs, and digital leaders who are looking for ways to reach, retain and grow their customer base? 

The logical app alternative 

The old battle advice goes: fight your enemy where they are not. Military strategists agreed that having your enemy come to you and fight you on your own terms was preferable. In a world where customers have access to thousands of offerings and millions of deals online, we need to flip that idea to Meet Your Customers Where They Are. 

Any marketeer will tell you just a how difficult it is to drive app downloads. Development, cross platform testing and user interface aside, the marketing campaign required to get customers to download the app can swallow entire annual budgets and still come up short. 

Looking at the facts, it makes infinitely more sense to work within the digital platforms already being used by your target audience. 

Clickatell is already enabling chat commerce for some of the leading global brands with its Touch solution. This allows organisations to serve their customers with an ‘app-like’ experience inside the chat or browser platform of their customer’s choice (Twitter, Facebook Messenger, etc.) 

Brands can now send an actionable Touch link such as ‘find the nearest ATM’ or ‘reset my password’ within a chat stream that will open an intuitive touch card without the user having to download an app to perform the action. Services can also be linked to the in-app experience for brands not looking to abandon their app efforts. 

Working with our clients, many of whom are global innovators and thought leaders, we’ve found that having the courage to design with an ‘end user first’ approach and dealing with the back-end complexity behind the scenes results in cost efficient customer delight and ROI. 

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