In the payments industry, tokenization is often portrayed as a new or futuristic security method, better suited for the world of mobile wallets than the era of magstripe cards. But SeatGeak decided early on to make it a cornerstone of its mobile commerce experience.

Tokenization replaces sensitive account data with a value called a token, which is linked to that transaction and can't be used to create a cloned payment card. The technology is fundamental to the security of Apple Pay and other emerging payment products.

SeatGeak, a sports and entertainment ticket search site, began working on an integration with credit card data vault and payments gateway Spreedly in late 2014. After testing and full deployment, the new system — which relies heavily on tokenization — has increased conversions 300% in about a year, and has 40% of customers return each month, a rate the company said is also increasing.

Spreedly provides SeatGeak with a token that allows the ticket site to securely retrieve the consumer's payment data, enabling one-click payments within SeatGeak's app. SeatGeak and Spreedly handle the transaction with the sales staff for the event sponsor or third party broker, and the tokens protect consumer's information in flight.

This level of security allows SeatGeak to replace its earlier model that redirected customers to a ticket broker through a referral link. The old method required consumers to re-enter payment information at a different site for each ticket purchase.

"It doesn’t matter who the user is buying the ticket from, the card data is stored with us," said Justin Benson, CEO of Spreedly.

SeatGeak operates in market with a lot of competitors, including StubHub and TicketMaster, and using payments technology to gain an edge is part of the game. Gametime, another ticket app, is using Venmo's social payments engine to make it easy for a group of people to split payments.

In SeatGeak's case, it's using payments security technology to give it an edge by providing an easy experience. Cart abandonment is a big problem in its industry, as people are quickly discouraged by being redirected to another site after finding a seat, said Eric Waller, the co-founder of SeatGeak.

"Before we didn't have good insight into what people were doing, we saw the clickthrough rate but were not able to see how many purchases result from the search," Waller said. "That was the big story for us because most people who do this don't have this type of insight."

Spreedly, which delivers tokenization as a Web service, predicts the model will be transferrable to other industries.

"We're seeing it in a lot of different areas where there are metasearch sites for hotels, bed and breakfast, airline travel, vacation rentals…anything where someone who does a search is routed to a third party on the back end to make a payment," Benson said, adding Spreedly is also looking to branch into charities seeking to receive donations via mobile apps.

Security has advanced enough to allow purchases from search sites without redirection, said Adil Moussa, a payment consultant.

"The case is just storing the card information on a different platform," Moussa said. "It's a little loophole that allows the merchant to remain outside of PCI compliance and it is used in many recurrent billing businesses such as telecom, subscriptions to remove friction at the point of sale."

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