Resilience Council partner Trust My Group publishes informative blog series about navigating Risk: An Overview of Risk for the Travel Industry

Written By Karen Jensen

Trust My Group's brand, Trust My Travel, has delved into the multitude of risks inherent in the travel industry and provided strategies for effectively managing them in their recent blog series, "Navigating Risk”.

 The first instalment of the blog covers the risks the travel industry faces including insolvencies, disruptions, chargebacks, reputational damage, and high insurance premiums. Insolvencies of suppliers, disruptions such as economic shocks or health crises can cause cancellations and strain on operations. Chargebacks, particularly high in the travel industry, result in financial losses and potential blacklisting. Reputational damage from negative incidents can lead to cancellations and reduced bookings. Connected to this is of course the rising cost of High insurance premiums that are a barrier to profitability.

While the first instalment covers the risks and gives detailed definitions of the risks for the travel industry, the second instalment showcases the impact of data on risk mitigation.

To mitigate risks, travel businesses can adopt proactive measures including responsible financial management, supplier due diligence, and a diverse supplier network. But data can be as useful to forecast any changes and helps with risk management. For example, utilising internal data sources like booking, payment, website, and customer support data and external ones like economic trends, travel restrictions, health alerts, and news reports can aid in risk management.

 Operational efficiency can be improved by effectively utilising data by identifying bottlenecks and making targeted fixes as well as managing reputation risk by monitoring traveller sentiment and surveying feedback. Furthermore, data can help with informing fraud detection tools to monitor transactions for suspicious activity.

 But not all risk can be mitigated by forecasting with data or managing reputation. The third instalment showcases that having a secure way of managing payments are as important: New models like trust accounts are emerging to mitigate financial risks in the travel payments ecosystem. Trust My Travel offers financial protection and payment processing solutions to safeguard travel businesses and build trust with customers. With Trust My Travel, you get an ABTA-approved Package Travel Regulations and Package Travel Directive-compliant solution that safeguards consumers should you or one of your named suppliers experience financial failure. Trust My Group simplifies package travel protection for travel businesses.

Operating a protection-led business model ensures that traveller funds are managed responsibly, and profits are spent appropriately, therefore avoiding financial failure. Overall, proactive risk management and resilience-building are essential for travel businesses to thrive amidst uncertainty in the industry.

Travellers today are wary of who they choose to purchase travel from—they need to feel assured that their funds are in safe hands should anything go wrong between purchase and delivery. When they see the Trust My Travel logo, travellers can feel assured that their payments are 100% financially protected against insolvency.

 The fourth instalment focuses more closely on the traveller and the changing needs the individual got before summing up how important it is to go with the time and find insurance that suits the ever-evolving travel industry. Traveller expectations are changing, with increasing emphasis on sustainability and flexibility. Businesses need to adapt to these changes and invest in technologies like artificial intelligence and automation. Future regulatory changes also pose risks, and businesses should stay updated and develop contingency plans. The industry needs proactive action to create resilient businesses and Trust My Group at the forefront of this development.

Karen Jensen
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