Once a company has customers willing to spend their Bitcoins on various good and services, one of two scenarios could unfold. Either the customers spend a tiny amount in Bitcoin to test the waters, with chances of them not using the service again. Or, they can spend big and make the entire Bitcoin acceptance strategy very profitable. In the case of Destinia, integrating Bitcoin payments has been quite fruitful so far.
Got Bitcoin, Will Travel!
Booking a flight and/or hotel through traditional payment methods is quite a pain in the neck to say the least. Double-charging credit cards or wrongfully booking wire transfers are just some of the potential risks when using those payment options for your next trip. Additionally, most service providers have slow to horrible customer support, making your stress-free vacation a lot more stressful in quick succession.
For the travel agency or service provider, accepting credit cards and bank transfers is also far from an ideal solution. Card payments are subject to high fraud rates and chargebacks, plus the initial payment costs nearly 3.5% in fees to process. Wire transfers take days, if not weeks, to clear, while customers want to leave for their holiday destination as soon as possible.
Dealing with cash transactions isn’t much better, as it makes travel agencies vulnerable to robbery and theft. Plus, they are forced to spend funds on dedicated money transport companies to pick up funds and bring it to the bank. None of the traditional payment methods are beneficial to either customer or merchant in this case.
Luckily for all parties involved, Bitcoin offers a solution to these problems. Transaction fees are minimal, payments are nearly instantaneous and virtual currency payments can not be charged back. From the customer point of view, no sensitive financial data is shared with the travel agency either, as there is no card or bank account involved.
It should come as no surprise to find out that a few major travel websites such as Expedia and Destinia, have started accepting Bitcoin payments since 2014. With no additional payment infrastructure to set up, neither company had anything to lose by doing so. In the case of Destinia, the decision has worked out quite well, according to a company spokesperson.
Bitcoin customers spend – on average – US$18 more compared to transactions with traditional payment methods on the Destinia website. The Spanish travel agency has been receiving Bitcoin payments nearly every day, but there is also a slight decline in the number of overall transactions in recent months.
Reasons For Decline Remain Vague, Destinia Still Very Optimistic
“Despite all of this, we are delighted with the way in which this payment method [bitcoin] is performing and we foresee a lot of potential. Last year bitcoin was mostly used for paying for hotel reservations, this year we have noted a significant increase in bitcoin payments for flight bookings … currently, sales for both are pretty levelled.”
A few reasons for the slight decline in Bitcoin transaction volume include the lower Bitcoin price – an issue affecting nearly every aspect of the popular virtual currency – as well as more competition in the online travel agency space. None of this is keeping Destinia from being optimistic for the future however, as the company recently announced Bitcoin payments can now also be used for low-cost flights.
As you would come to expect from a European online travel agency, Destinia’s most active Bitcoin customers can be found in Spain, Germany and Sweden. That being said, Argentina is also ranked in the top four, which is a bit of a surprise. However, Argentina has been warming up to Bitcoin in recent months, which could be a determining factor.
Source: Information Via Email
Images courtesy of Shutterstock, Destinia