Rebuilding Tourism Through Small Businesses
Governments, and their associated destination marketing organizations (DMOs), have a unique opportunity to develop an interconnected payments ecosystem. The benefits will be particularly felt by small businesses, which account for 97% of all businesses in Asia according to a recent report from the Asian Development Bank, and account for most businesses in the tourism sector—80% according to the latest estimate by the World Travel & Tourism Council. A tourist—particularly an international one—appreciates simple, secure and standardized experiences in core areas such as payments.
The approach could also help DMOs establish integrated tourism engagement platforms and marketplace websites. These could provide trusted solutions for micro businesses that want to sell online but can’t support an app of their own.
Related to trust is the importance of building customer loyalty. Unlike larger businesses such as hotel chains with multiple locations under a single brand, small businesses in tourism won’t necessarily benefit from offering a rewards program of their own. Payment-linked offers and rewards could be one way for small businesses to achieve the same reach, and DMOs could play a critical role in facilitating access. Integrated tourism apps for destinations could serve as secure and trusted loyalty platforms for small businesses while also helping DMOs better use data insights to support the ecosystem
Governments and DMOs could also address the tourism sector’s seasonal liquidity challenges by using payments to connect businesses across different management platforms. A central list of buyers and suppliers in the tourism sector could pull small businesses together in an industry-agnostic directory to unlock cashflow efficiencies.
A recent Mastercard report looks at the benefits of a coordinated approach from two sides: business to consumer (B2C) and business to business (B2B). Download the full report to learn how governments and their associated DMOs can help coordinate services and solutions for SMEs in the tourism industry:
Strength in numbers: Coordinating small businesses in the tourism sector
Mastercard recognises that as borders reopen and travel returns, it will be more important than ever for tourism to rebuild in ways that drive resilience and create opportunities for small businesses to digitally transform themselves.
This is why Mastercard launched the Tourism Innovation Hub earlier this year in Spain, to foster research, apply data insights and co-design technology solutions for the sector. The global tourism industry has been through a tough couple of years, and Mastercard is committed to providing digital-first solutions and data-driven insights to governments and small businesses worldwide for a more inclusive, equitable and sustainable recovery.
Mastercard will be hosting a launch event for the Tourism Innovation Hub in partnership with the UNWTO on 17th to 18th May 2022. To learn more about participation, please contact government@mastercard.com.
