Questioning the travel industry status quo, one blog post at a time


What’s the real story with Amadeus and its Fare Families?

On September 23, 2016, an article was published by Tnooz with the following headline:

“Amadeus admits fare families are not working for all its airlines”

That same day, the headline from the story was changed as follows:

 “Amadeus says fare families work well for some airlines but not all [UPDATED]”

So what is all this about? Why the different headlines? In my book, it’s called editorial influence and it is usually quite rare to update an article with a different title, but we’ll leave that for what it is.

The real story is not the change of headlines, or even that some (or all) of the airlines that invested in the Amadeus merchandising offering are not getting the results they expected. The real story, if you are an airline, is getting a better understanding of the technology tools available so you don’t make costly mistakes that will significantly limit your airline’s future when implementing one of the most revolutionizing aspects in ensuring Happy Customers, and More Revenue.

Is the Amadeus offering a true merchandising engine? Perhaps you should Ask the Question. In my view, it’s actually just a merchandising “program” that airlines sign up for and Amadeus, rather than the airline, sets up and determines how the airlines will participate. If my thinking is correct, then frankly, it’s no surprise that the results can be sub-optimal. Any attempt to utilize existing GDS and PSS systems and industry processes – that were never designed for anything close to airline merchandising – to implement an airline merchandising program is bound to be fraught with difficulties.

From the Farelogix point of view, our FLX Merchandise airline merchandising engine was created from scratch, and designed as a “built-for-purpose” technology solution for airline merchandising. It was created with input from the airlines so that it addressed their particular needs. Our technology solution is designed to be integrated into the airline’s actual technology stack servicing all distribution channels. This is a fundamentally different approach and yields fundamentally different results. Just ask our FLX Merchandise customers*.

We’ll spend some more time in the near future providing more details of the different approaches to building and delivering airline merchandising solutions. And, of course, we will continue to Ask the Question.


* Skift published the following headline…and only once:

United Generates More Ancillary Revenue Than Any Other Airline – Brian Sumers, Skift – Sep 21, 2016 6:30 am

It’s beeOptical fibern a long time coming, but it’s incredibly rewarding to finally see NDC connectivity to the Sabre GDS enabling airline product differentiation, personalization, and improved profitability.

If you missed the news, I’ll recap it for you. American Airlines recently announced its GDS integration to Sabre using the airlines’ NDC-style API. It’s no secret that Farelogix built and powers the AA direct connect API, and that we are incredibly proud of the work that has been done with the airline to date. Connecting a full-service airline’s API to a GDS is no easy feat – at least doing it the first time – but all three companies (Sabre, AA, and Farelogix) worked hard and cooperatively to make this happen. But, believe it or not, that’s not the real story here.

The real story is what this connectivity to Sabre means for an industry that has basically been “stuck” in third party distribution limbo for years. This announcement just changed the status quo for everyone, and it’s a win-win situation for all. No one loses.

Airlines win by being able to offer differentiated content, which can increase loyalty and generate new revenue. The TMCs/OTAs win by having the most up-to-date and relevant airline content, helping to secure their value proposition to their customers. The GDSs win by being able to deliver (and ultimately display and sell) new airline services to their users (i.e., airlines, TMCs, and corporate booking tools). Consumers and corporate travelers win by getting access to the airline content and product choices they have been clamoring for, with minimal process change.

Given our history with Sabre, I was skeptical about ever seeing this level of win-win situation in airline distribution in my lifetime. But there it is, staring us right in the face. And although there is still much more work that has to be done to bring the entire industry in line with NDC, for once we are all moving forward in the right direction. New airline connectivity to GDSs is here, and it is reloading the value proposition for what was always viewed as a tired, outdated, and over-priced distribution channel. Plus, any future GDS integrations with our other airline customers will be almost automatic since 90 percent of the integration work is reusable with any GDS, thanks to an NDC-aligned integration standard.

How great is that? And in my lifetime too!

An effective airline merchandising program showcases your brand, delights your customers, and grows both revenue and loyalty.  But effective airline merchandising is not easy to accomplish.  Embracing value-added services, personalization, and New Distribution Capability (NDC) requires innovation on many levels, from strategy to technology.


Farelogix is pleased to announce Dan McKone of L.E.K. Consulting and Jeff Hong of Hawaiian Airlines will both speak at the Ancillary Master Class on August 31st, 2015. Dan McKone is a Managing Director with L.E.K. Consulting, as well as a Partner and member of L.E.K.’s Global Leadership Team.  He currently heads the firm’s Retail Sector and Head of Travel/Lodging in the Americas.  He has directed more than 300 projects spanning corporate strategy, new concept development, and channel strategy, pricing and positioning.

Jeff Hong is currently the Director of Commercial Applications with Hawaiian Airlines.  After a successful tour-of-duty with the United States Army, a period working with a technology startup, and working with Microsoft, he returned to his home state of Hawaii.  At Hawaiian he specializes in delivering cutting edge solutions for the airline.

It is not too late to sign up for the Merchandising Master Class.  For more information, please click here.  If you would like to register for the event, please click here.

After attending the Merchandising Master Class, please be sure to attend Airline Information’s 2nd Annual Mega Event Asia Pacific 2015.  This conference will bring together industry stakeholders responsible for merchandising to discuss the latest trends, best practices, actionable strategies and insights.

Last month, Farelogix hosted its Merchandising Master Class as part of Airline Information’s (AI) Mega Event in Barcelona, Spain. Farelogix representatives brought together industry thought leaders, top airline performers, and technology solution providers to discuss merchandising with the standing-room-only crowd. These Master Class events, which have become a staple of AI’s Mega Event series, have been conducted all over the world – from Singapore to New Orleans.

Recognizing that designing and implementing an effective airline merchandising program requires innovation on many levels, the Barcelona workshop explored the entire end-to-end process with a focus on taking action – from strategy to execution. Real case studies and hands-on technology approaches were used to tackle the full spectrum of successful merchandising including: differentiating your product and brand; tips to create and optimize the best offer; and insights on New Distribution Capability (NDC) and related technologies that can help you get to market quickly with the highest flexibility, efficiency and revenue per passenger.

Jim Davidson, President of Farelogix, kicked off the event with his presentation: “Merchandising Call to Action: Are You Leaving $15 Per Passenger On The Table?” Read the rest of this entry »

FLX-M Use Case Challenge

For those of us in the northern hemisphere, spring is here! The temperature is warming, and the snow is finally melting. It was a great winter if you love skiing and sledding, but it was quite miserable for airlines trying to run on schedule. The delays and cancellations added up quickly, leaving passengers frustrated and airlines stretched to accommodate everyone. And while the good news is that the weather is getting better, there will still be storms, equipment troubles, and a myriad reasons why flights get delayed and canceled.

As an airline there’s often nothing you can do about such troubles, but your customers usually don’t see it that way. You can however make the rebooking and re-accommodation process as simple and pain-free as possible. This is exactly where FLX Merchandise can help.

Today, most airlines send emails and/or text messages to impacted travelers and those messages are usually limited to two choices for the travelers: 1) go with the auto-rebook on another flight (chosen by default by the airline), or 2) please call customer service.

But with the power of FLX Merchandise and personalization, a “Recovery Package” can be offered to the traveler that can turn a negative, frustrating situation into a positive experience with the airline—and we all know how word-of-mouth can impact customers’ feelings towards an airline. Read the rest of this entry »

An effective airline merchandising program showcases your brand, delights your customers, and grows both revenue and loyalty.  But effective airline merchandising is not easy to accomplish.  Embracing value-added services, personalization, and New Distribution Capability (NDC) requires innovation on many levels, from strategy to technology.


We invite you to attend a one-of-a-kind master class, dedicated to exploring what it takes to successfully grow happy customers and more revenue through effective merchandising and value-added services.

At Merchandising and NDC: The Path to Happy Customers and More Revenue, we will tackle the full, end-to-end process of merchandising and personalization, including how to differentiate your product and brand, creating and optimizing the best offer, leveraging NDC, and understanding what technologies can help your airline stand apart while increasing revenue per passenger. Read the rest of this entry »

FLX-M Use Case Challenge

Corporate travel is the lifeblood for many airlines. With competition heating up with differentiators like more comfortable seats, additional legroom, and countless other value-added services, how the airline retains its corporate clients—or woos them from a competitor—is more strategic than ever before.

Just think, not so long ago, in the pre-NDC, pre-merchandising world, the only option for airlines seeking to accomplish a “differentiated corporate product” was to file private/negotiated fares for corporate clients via ATPCO. The extent of the differentiation was the filed fare itself, which was special for that corporation. Missing from that picture was the myriad of other services and privileges negotiated for that corporate client. Rather than competing on a customized, relevant offer of services, airlines were stuck competing strictly on a number and a fare basis code.  Fortunately, those days are behind us. Today, using sophisticated merchandising systems such as FLX Merchandise, airlines can configure customized offers that go far beyond a filed fare and include a series of bundled services or options most relevant for that trip, corporation, and traveler. Let’s look at a couple related Use Case Challenge examples. Read the rest of this entry »

FLX-M Use Case Challenge

There are many universal truths in life: money isn’t everything, laughter is the best medicine, and so on. I think another one is that people really love a good meal. And for decades another universal truth was that airplane food was bad. But that’s all changing! Today, airline meal options are plentiful and tasty. Airlines are going gourmet and some even have culinary delights from celebrity chefs!

The power of meals to differentiate an airline’s brand – and drive revenue – has made this a popular Use Case topic, and so we’ve decided to feature an example. So, how does an airline approach premium meals for Economy Cabin?

Like any product offering, there are a few basic questions for the airline to answer. In this case, things like:  What meals will the airline offer? In what conditions does a particular meal make it onto the menu (based on markets, flights, regions, etc.)? And what—if anything—will the airline charge for the meals, taking into account personalization and loyalty status? Each of these “answers” are is easily configured in FLX Merchandise, which will then drive the business rules engine to pass the correct offer or choices to the airline’s point-of-sale using standardized XML web services. Let’s take a quick look. Read the rest of this entry »

FLX-M Use Case Challenge

Airline Merchandising isn’t always about creating value by selling additional products and services. Very often, using merchandising to reward loyalty can be just as beneficial. Loyal and high-value customers often expect a certain level of service, and retaining these customers by providing certain perks can be extremely valuable. This brings us to today’s Use Case Challenge…

Today’s Challenge: Chauffeur Services

In this example, an airline wants to offer chauffeur drive services at departure and arrival for travelers in the first- and business-class cabins who have the highest level of frequent flier status. In this example, we’ll focus on the arrival portion of the offer. Let’s see how this looks in the offer designer…

Follow the JFK – * node to the 0.00 USD node. In this scenario, the service is offered at no charge for those travelers in first and business class, who also are members of the Tier 1 frequent flier program. Read the rest of this entry »


FLX-M Use Case Challenge

Ancillary revenue has become key to airline success, with almost $50 billion in revenue projected in 2014. As luck would have it, we have an award-winning airline merchandising engine (FLX Merchandise) that is helping a number of airlines grow revenue and make customers happy. Among all the cool features of FLX Merchandise, without a doubt, the one that always tops the list among our airline users is flexibility. It’s always fun to demonstrate how new products and services can be introduced in a matter of minutes (not months!), without hard coding and without the overhead of administrating a static product catalog.

In fact, showcasing the flexibility is how we came up with the very first FLX Merchandise Use Case Challenge. There we were, leading a Merchandising Master Class in Singapore, and we thought, “Why not try a live on-the-spot challenge?” So about five minutes into the event, we invited about 100 merchandising managers to submit ideas and strategies for merchandising. What do you want to offer, to whom, and how? We were impressed by the creativity of the submissions—some of these people were really thinking outside the box! Read the rest of this entry »