Travel and payments are two examples where there are different futures for outwardly similar cultures.
There is no future. No singular future at least. Everyone’s future is different, moderated by geography, culture, and our own experience. We are not all impacted by the same, single wave of change. Instead, there are many parallel and overlapping waves of change that hit different places, and different sectors, at different times.
Spend some time abroad and you will see this clearly. In Germany this Christmas, I noticed two very great differences to the British high street. Places where waves of change were more advanced here, having encountered different social and cultural barriers. First, the prevalence of travel agents. And second, the lack of electronic payment options.
On paper the adoption of e-commerce by consumers in Germany is very similar to that in the UK. 15.1% of transactions in Germany are online vs 17.8% of the UK, but in terms of internet penetration and uptake of ecommerce, the numbers across the two countries are very similar. But it appears that in one sector at least, travel, the behaviour is very different.
Germany trails the European average when it comes to use of online travel agents, at 43% of transactions vs the average of 49%. In the UK it’s more like 60%. In Germany, high street travel agents continue to grow alongside growth in the online market. This is very easy to see. Walking through the centre of Heilbronn this Christmas, I was amazed by how many travel agents we saw: five or six stores along one route. And they didn’t look tired or defeated. These were freshly-refitted shops with sharp window displays. And they were busy. Heilbronn is not a big place. It’s a regional capital but its population is only about 125,000.
Travel and payments: cultural differences?
You can read this two ways. Germany is culturally different, so there is a sustainable, larger market for high street travel agents. Or, the Germans are on the same path as we are, towards the majority of bookings being online, and just behind us on that curve. The answer, as usual, is somewhere between the two. It may well be that Germany will have a larger proportion of offline transactions in the travel sector for the foreseeable future. But the macro trend is the same between the two countries: towards digital.
The same is true for payments. The other shocking thing as a consumer in Heilbronn was the prevalence of cash. Restaurants and bars just did not take cards. And I’m not talking about tiny places, but big independents, like the Italian restaurant where I had to leave my family to go and hunt for a cash point in order to pay for the meal. Will this cultural preference for cash persist? Or will it ultimately be overwhelmed by the shift to digital forms of payment? My belief is the latter, but it will never be quite like other places. Every future is different. That’s true for travel and payments, and for a thousand other small differences between geographies.
So much of our discourse about the future is driven from the same sources. Tech-heavy, US-centric, and market-driven. It’s easy to forget that even the most universal of macro trends will encounter different levels of resistance in different places and sectors. This resistance will both change the rate of adoption for any big trend, but also drive adaptations. Trends can be macro but their local effects will always be moderated by the environment. Not one wave of change but many, smaller waves.