Firms Using Payments Orchestration In 2021 Conducting Business At Speed And Scale

Without rehashing the COVID calamity yet again, suffice to say it’s bad for most — but not all.

PYMNTS April 2021 Payments Innovation Readiness Playbook, a Spreedly collaboration, looks at triumphs and tragedies from this strange time, with a special focus on the hurting travel sector.

With a nod to “operational complexities that travel and hospitality companies face when optimizing payments operations and maximizing the user experience,” the Playbook gauges how companies are using payments orchestration to streamline, and the underlying models.

As the Playbook states, “Many players have … managed a sustainable pandemic pivot, creating a revenue optimization strategy that leverages payments innovation to secure consumer trust and recapture lost revenue.” It calls for secure innovation that scales. It calls for orchestration.

And it’s worth noting that travel and hospitality brands both native and non-native to digital including Airbnb, CWT, Hilton and Vacasa are deepening trust via payments flexibility and seamless new CX. “These players have been able to avoid much of the financial devastation that hospitality brands with limited digital payments capabilities” have endured, per the Playbook.

Clearing A Digital Path For Legit Customers

The April Payments Innovation Readiness Playbook doesn’t mince words, stating straight out that “The industry shift toward payments innovation was wholesale and irreversible at the beginning of 2021.”

That means payments must support anywhere/anytime commerce “on every device and with any gateway, or it [is] not worth the investment.” The message is getting out, as “nearly 70 percent of online merchants and platforms now want to be able to orchestrate their payment processes to manage rapid growth” according to the Playbook.

Airbnb’s use of orchestration is highlighted in the April Playbook, which explains, “Payments orchestration routes payments to gateways that will process each transaction in the fastest, most secure way. That means low-risk, legitimate traffic is processed quickly, while higher-risk traffic is scrutinized further without damaging overall platform performance.”

In the new Playbook, Airbnb Vice President of Payments Sam Shrauger said orchestration “helps us to manage and maintain security on the platform, while providing a clean, simple and fast experience for our users. Because fraud and security attack vectors change constantly in the digital world, our systems, models and authentication methods evolve constantly to help ensure that we stay one step ahead of the curve.”

Because travel can involve cross-border payments, that’s part of the orchestration conversation. “Each geographical region, card type and currency may hold unique challenges that increase latency or false declines. Use a payments orchestration tool that offers intelligent routing in real time, directing each transaction to the payment gateway that is best suited for each transaction’s specific regulatory, currency and processing performance requirements.”

Transforming The Checkout Via Orchestration

Noting that “smart routing” to the most available, appropriate gateways can boost authorization rates by 5 percent, the Payments Innovation Readiness Playbook lauds orchestration for reducing latency and processing fees, “allowing marketplaces, platforms and brands to route payments instantly to gateways and services that provide the best value and customer experience in real time. It can foster faster payments and effortless compliance, even at scale.”

It’s remaking the checkout experience as well, “creating a frictionless payment experience irrespective of the platform or device used and allowing customers to pay through multiple online or mobile touch points without facing duplicate login requests or order processing delays. That means fewer false declines for customers — a consumer experience failure that may cause customer brand abandonment rates to be as high as 58 percent.”

While there are numerous nooks and crannies to issues of routing and gateway access, the new Playbook simplifies it, stating, “Complex or unreliable payment gateway integrations can cause failed payments or shopping cart abandonment via slow transaction processing. Companies that no longer face the challenge of fixing order processing problems on the fly are free to scale their business models across platforms and national borders. Successful marketing efforts will then increase customers — rather than a flood of transaction management challenges — as a business grows.”