Dealing with Mass Refunds in the Travel Industry

Apr 2, 2020
Daniel Burton
UX Writer
Min to read

COVID-19 has affected a lot of businesses in different ways. 

For a few, it has actually been positive, but for the vast majority of services, especially those involving travel, there have been devastating losses as companies are forced to suspend services and deal out mass refunds to their customers. 

"On 5 March 2020, the International Air Transport Association estimated that the airline industry could lose between US$63 to 113 billion of revenues due to the reduced number of passengers’"

The reduction in this service then creates a domino effect, which results in other industries being hurt by this crisis.  

"Hotel industry revenue per available room in the United States fell 11.6 percent for the week ending March 7 compared to the year-earlier period" -STR

Here are a few industries that are most at risk:

  • Flight & Flight Transfers
  • Event Booking
  • Hotels & Accommodation
  • Travel Management Companies

With companies now having to take drastic measures quickly, here is how a simple integration with our Promotion Engine could help you deal with your mass refunds and a variety of other challenges you’re likely facing in the travel industry at the moment. 

Giving Refunds with Coupons

A way to prevent taking huge losses is to create coupons with company credit to use once life returns to normal. 

To increase the likelihood that a person will accept this option, it’s worth noting that you can offer a slightly higher amount than the initial purchase (10-15% plus).

Assign these coupons directly to each user’s profile ID for later use, or make the coupons transferable gift cards that people can gift each other while the lockdown is still in effect.

If you have affiliates that are doing well in this current climate, another alternative could be to issue a refund coupon that can be spent with them to reduce damage.

Incentivize Future Bookings

You’ll need to be inventive to keep your cashflow running, and some providers are already posting vacations for summer 2021, for this reason.  

Try running a partner discount program for any complementary services that are doing ok at the moment, like home entertainment or delivery services. 

Promote going on vacation in the city your customers live (give them a discount on an experience, or a fancy hotel where they’ll be both safe & entertained). More creative ideas for a country in lock-down here.

Time to Work on Your Loyalty Program

Don’t forget that your existing customers are your biggest asset at the moment. You need to create a community to help increase your revenue. 

Remind your customers that you’re still here, and take steps to keep them engaged. 

  • Incentivize user-generated content. This could be a competition on social media, or a throwback post from when your customers were still traveling. As a prize you can offer customers a coupon code or a discount on their next purchase. 
  • Engage customers through virtual tours, webcams, and live streams. Keep them engaged by generating valuable and interesting content, from traveling tips to discoveries. 
  • Incentivize reviews, tags and referrals to spread the word that you’re still in business.  
  • Create gift cards to support your brand. Show your customers some love and support sending out gift certificates with no expiration date.  
  • Offer loyalty points for interaction on your website and social media. Gamify the experience on your website and give points for behaviour that increases brand awareness or generates future leads.

Do it all with Talon.One

If you’re having any of these issues, we recommend booking a demo. After filling in your details, we’ll email you asking about your use cases, arrange a good time to talk, and tailor a demo for your specific business challenges.

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Best Practices for loyalty programs
How to gain a competitive advantage
Your definitive guide to loyal customers