Rewind two years back. The hospitality sector was put on a halt with business closures or operating under strict restrictions that limited customer capacity. Fast forward to 2022, there’s a glimmer of hope for hospitality to recover so long as organisations in that industry optimise their payment strategies. However, as our latest whitepaper The Great Payments Transformation reveals, more than nine out of ten hospitality businesses (96%) report losses in revenue.
Join us as we explore what’s preventing payment leaders in hospitality from investing in optimising their payments processes. We will also deep dive in what’s trending in the payments landscape, and how emerchantpay can help payment professionals in hospitality enhance their organisation’s payments performance and maximise their bottom line.
What blocks hospitality from maximum payments performance
As our research showcases, hospitality businesses across the board could recoup part of their lost revenue if they review and evolve their payment systems. Precisely, more than half (51%) estimate a 4-6% uplift in revenue within the next two years if they make the necessary improvements. It should be noted that the majority (56%) of respondents would need to implement those changes by the end of 2022 to minimise revenue loss and drive performance.
Despite these promising predictions, hospitality is still faced with major challenges when it comes to investing in optimising payment solutions. The burden of regulation acts as the core barrier to this for almost half (54%) due to the time and focus it takes. A shortage of metrics to measure impact and ROI is another stumbling block for one in three (39%) payment professionals versus a lack of budget and cost issues dropping at 26%.
Data is a vital component in every organisation, as the insights yielded can facilitate better-informed decision-making that may accelerate revenue growth. Unlike most industries, as highlighted in our research, hospitality operators are confident in their ability to leverage data to optimise payment strategies, with 25% rating their team as "excellent" compared to 15% across respondents. What's more, 69% said there was little room for improvement when finessing payment systems versus 46% overall.
Acknowledging how pivotal payments performance is and making investments to optimise it is imperative to help payment leaders in hospitality deliver the maximum value to their organisation. Although 87% of respondents noted the urgency of changing their payment infrastructure in the next 7-12 months to safeguard revenue, they've also expressed concerns about payments performance.
Concerns about payments performance and steps that could enable optimisation
Payments are one of the most dynamic fields of technology and keeping on top of innovations, evolving regulations and customer needs can be taxing for the hospitality sector. In fact, many of the blockers identified in the previous section inform some of the concerns that payment leaders in hospitality have stated.
Across the two countries surveyed, integrating payments with the rest of the business was noted as the top concern for almost five in ten (47%) payment leaders in hospitality. Simultaneously, implementing new payment methods as well as ever-changing regulations and compliance rested on 44%, representing the second most cited consideration. In equal measures, being able to get quality insights from payment data along with keeping up with changing customer demands and expectations on payment preferences are key concerns for one in three (36%) respondents.
When asked what payment leaders in hospitality could do to better enhance their payment infrastructure, 44% acknowledge they could optimise payment routing. This is closely followed by nearly 43% who could minimise checkout friction by optimising payment pages. Setting local preferred methods to the forefront of their payments page could also enable optimised payments performance for 37% of payment professionals.
Consumer demand is shifting at a stellar pace, and the hospitality sector is under pressure to adapt to the new era of payments that's already at our doorstep. In the following section, we'll drill down on the emerging payment trends that payment leaders project to have the biggest impact in hospitality.
What’s the next big thing in payments and key factors to choose a PSP
Preparing for the future, just under half (48%) of payment experts in hospitality forecast that subscription payments will be the trend to take the hospitality industry by storm in 2022. This is followed by online banking and digital wallets for 38% and 34% of them, respectively.
Evidently, as the payments market evolves, hospitality businesses have to observe developments within it to ensure they partner with the right payment service provider (PSP) that will cater to their needs. Interestingly, our research indicates that the criteria for selecting a PSP vary per region in the hospitality industry. In the UK, a range of global payment options (43%) and payment routing capabilities (42%) are key factors when choosing a PSP as opposed to hospitality organisations in German that prioritise one-stop-shop solutions (43%).
Working with a PSP that can provide strategic 1:1 advisory, in-depth data analysis and tailored expert support is paramount. In fact, nearly nine in ten (88%) of hospitality businesses view dedicated 1:1 support from their Account Manager for day-to-day queries as very important while 89% expect the same level of support from their risk analysts. At present, nearly six in ten (58%) respondents are open to change their PSP. What these figures indicate is that hospitality businesses realise the positive impact payments can have on their wider business objectives. And working with an experienced and dedicated PSP that spends the time to understand their business model and needs can facilitate payments transformation.
How emerchantpay can help
High payments performance is inextricably linked with optimisation. Identifying tangible areas for improvement in payment systems is of strategic significance, as it can carve out the pathway to ongoing business success. This suggests that hospitality businesses looking to outdo their competition and increase profitability will need to finesse their processes to ensure payments efficiency and agility.
Having over 20 years of payments experience and a broad range of cutting-edge payment solutions, emerchantpay has a proven track record in helping hospitality businesses take off and grow. We empower hospitality businesses to develop a robust performance strategy that meets their business goals and strengthens the value of payments for their organisation. Dough Boys Pizza is a testament to our adaptable offering and collaborative approach, as our dedicated team supported them with their growth plans and improved the restaurant's daily operations through our robust payment solution. (Read the case study here). It's time for an upgrade that will transform the payment strategies of hospitality businesses for long-term business success.
Get in touch with your payment specialists and learn how you can future-proof performance to increase your revenue and conversions.