You know me. I love to talk airline distribution any chance I get. The other day I was involved in a discussion about the traditional distribution model, often times referred to as the Push model. The Push model, currently employed by intermediaries like the GDSs that feed information to most travel agencies, is essentially a static model where the GDSs gather basic airline components (schedules from OAG, fares from ATPCO, and fare class availability from the airlines) and store this information in their own systems. This stored information is periodically updated from the aforementioned sources. This data then patiently waits for a travel agent to make a travel request inquiry to the GDS. The GDS (not the airline) then creates the actual airline offer for the agent on behalf of the airline, often times with little or no input from the airline until well after the sale is made.
The Push model has served the industry well in the past and made all the sense in the world at the time it was developed. However, today’s Push model is a technological byproduct of an era when electronic communications and bandwidth were expensive (pre-Internet), system-to-system connectivity was complex, temperamental, and expensive (pre-APIs and web services), and airline content was little more than a published set of schedules and fares combined with availability based on fare classes.
But, as often happens, things change. New innovation upsets the status quo as new technologies hit the market. Assuming the market is open and not dominated by one or a few players, innovation nurtures in sweeping changes—new products, competitors, processes, and in many cases, new lower-cost pricing structures that drive efficiency and satisfaction for both buyers and sellers.
Enter the new Pull model in airline distribution. This model is not only the product of newer and cheaper technologies, but also a direct result of a desire by many airlines to serve up more and varied dynamic products and service choices to consumers.
The Pull model, put simply, is a new process of sending the travel agent inquiry directly to the airline(s) with as much information about the traveler as available at the time of the inquiry. The airline (not the GDS) then creates a specific offer based on all the available criteria and sends a fully “personalized and transactable” offer back to the travel agency via a distribution aggregator for display (a GDS or other third-party aggregation tool). This process has been referred to as the Distribution 2.0 model based on traveler authentication, or Who’s Asking.
While the Pull model is not yet widely implemented in the airline distribution industry (with the notable exception of how Low Cost Carriers connect to a GDS), it is not new to many other industries. The Internet, broadband, and faster communications protocols have made adoption of the Pull model commonplace today. Essentially every time a user “signs in” to a consumer website that stores any profile information about the user, the Pull model is most likely being deployed. Amazon, Google, and Apple all deploy elements of a Pull model.
As empowering as the Pull model may be for consumers, it is not without its detractors from both technological and process viewpoints. The two highly touted technological “push-backs” appear to be that 1) significant additional work (time & cost) would be required to connect to those individual airlines wanting to deploy the new Pull model, and 2) there would be too much latency (measure of time delay) in getting the information to and from an airline’s internal systems. I’d guess other industries that established the Pull model heard these very same objections. But, rather than retreat, these objections became the fuel that energized innovation. Standardized connectivity quickly overtook single, one-off connectivity initiatives, and, in terms of latency, well all I can say is that the guy next to me in 27E is streaming a video using the on-board Wi-Fi, and he doesn’t seem a bit bothered by any latency issues. And let’s give our industry a bit of credit as airline distribution connectivity is quickly being simplified and standardized through the good work of OTA, Open AXIS, and now IATA with their recently announced global connectivity standardization initiative.
From a process standpoint, the main objection to the Pull model seems to be a rather absurd notion that if an airline knows who its potential customer is, they will somehow withhold or hide content, such as the lowest fare. That is ridiculous and irrational. Airlines want and need repeat business, and consumers tend to vote with their wallets, especially if they sense they are somehow being bamboozled. So the notion that airlines would somehow want to withhold giving any consumer their greatest level of product choice, including optional offers which could be either free or paid for, would only make sense for an airline that has made a conscious choice to no longer be an airline!
Looking ahead, will every airline adopt the Pull model? Maybe. Or maybe not. But that decision should be up to the airline and its customers—the travelers. It should definitely not be defined, directed, or dictated by entrenched legacy companies, the government, or anyone else for that matter. Our nation has a rich history of letting competition and fair play flourish to the benefit of consumers. I, for one, think we should keep it that way.
Your thoughts and comments are always welcome.