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

Posts Tagged ‘distribution’

We’re happy to premiere a new video with a very simple, age-old concept: More Revenue Happy Customer. The concept is nothing new, but when it comes to airline distribution, sometimes it’s a concept we’ve struggled finding the right balance for.

Without further ado… Enjoy!

 

View the video on YouTube.

In case you missed last week, IATA’s Alexander Popovich wrote a great piece in Tnooz explaining some of the fears and angst surrounding NDC. Definitely worth the read!

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NB: This is a viewpoint by, Aleks Popovich, senior vice president for financial and distribution at the International Air Transport Association.

Providing customers with more information and choice, enabling agents to sell a wider range of products and opening up a new realm of services more closely tailored to customers’ needs.

This should be a welcome development in the travel industry.

However, IATA is well aware that many in the travel agency community are concerned about IATA’s Resolution 787, the foundation document for the New Distribution Capability (NDC) project.

Yet despite the filing of 400+ comments and motions for or against Resolution 787 with the US Department of Transportation, there has been almost no attention paid to what is really driving travel agent angst over the NDC project: fear of the unknown.

Read the rest of the article at Tnooz.

© Maridav - Fotolia.com

© Maridav – Fotolia.com

As a number of technology companies position themselves to capitalize on IATA’s NDC initiative, it is likely that some “NDC impersonators” may be lurking in the shadows, ready to pounce on unsuspecting airlines.  So, how do you know if you are dealing with an NDC impersonator? Well as Jeff Foxworthy might say, You know you’re dealing with an NDC Impersonator when they say…

“Hey, all you have to do is give us access to all of your customer loyalty data, and we will personalize the offer for you.”

– Or –

“We can build that API for you, and it will only cost you… $1 Million dollars as a down payment.”

– Or –

“You want to introduce a new kind of seat? No problem! It will only take 24 months for implementation.”

– Or –

“Don’t worry! The PSS will handle all of this… and it’s freeeeeeeee.”

– Or –

“Well, we’ll have to weigh your requirements against the community. Let’s put your idea to a vote to see if other airlines want it, too.”

And finally, you know you are dealing with an NDC Impersonator when they say…

“We coded those applications for your current solution. Of course it doesn’t work now because you changed hosting providers. It’s your fault!”

Empty_Box_Person_Looking_InOk, sometimes I am easily confused, but this one is taking the cake. I am totally confounded because in the last several months practically everyone I have spoken to—travel agencies, corporate travel managers, and even GDSs (well, Sabre and Farelogix aren’t really on speaking terms lately, so not all GDSs)—has expressed interest in having viewable, transparent, and bookable access to the various airline merchandising and ancillary services many airlines have on their websites. Everyone wants it, which makes perfect sense. Having access to more options that are relevant, up-to-the-minute, accurate, and maybe even personalized for the individual traveler making the request is clearly good for consumers, corporate travelers, corporations, travel agencies, OTAs, and GDSs. It’s good for everybody!

Enter IATA. IATA, through its standards-setting body, has developed its optional NDC initiative. This standards initiative was developed with input from various travel supply chain players. They worked long and hard to define a technology integration and workflow standard that enables an airline to deliver relevant, up-to-the-minute, accurate, and maybe even personalized offers to travel agencies, consumers, corporate travelers, corporations, OTAs, and GDSs. So, essentially IATA is enabling more airline content to be delivered and more is good, right?  Read the rest of this entry »

We couldn't think of a good picture for this blog, so we went with a classic gif: Monkey Washing Cat.

We couldn’t think of a good picture for this blog, so we went with a classic gif: Monkey Washing Cat.

I read Mr. Pestronk’s recent response to the NDC question with fascination and bewilderment. Clearly some education and clarification is needed, so I thought it best to go through parts of his article and add my comments. They are in bolded italics.

Think of NDC as like American’s Direct Connect except that, instead of being pushed by just one airline, it is going to be backed by all 240 IATA airlines, including all U.S. legacy carriers, at the same time. When you say, “think of NDC as like American’s Direct Connect,” are you referring to American’s Direct Connect to Travelport, whereby Travelport will connect to American using the NDC standard with the only difference travel agents will notice is that they have all the ancillaries that American offers and can therefore provide their customers with up-to-the-minute, authenticated, and perhaps even personalized offers? Because that is truly what accepting NDC means. It means an airline can use one modern, flexible pipe to connect to all distributors. No longer would there be a need for multiple pipes with separate and different standards on how to connect. Instead everyone would connect in the same way.

IATA has asked the Department of Transportation (DOT) to approve the agreement setting up the rules for NDC, and interested parties have until May 1 to file comments. True, and if you are a travel agency, I think you should encourage DOT to approve NDC as soon as possible so airlines that choose to adopt this new connectivity standard can get on with delivering that precious content travel agencies and their corporate and leisure customers want.
Read the rest of this entry »

© alphaspirit - Fotolia.com

© alphaspirit – Fotolia.com

As the airline industry begins to adopt modern and sophisticated distribution technology, we are delighted that United Airlines and Priceline have selected Farelogix as their technology provider in this innovative solution. It is clear Airline Commerce is expanding by leaps and bounds! On that note, we invite interested airlines to come see what all the fuss is about, and join us for the Farelogix Technology Symposium, taking place here in Miami in just a few weeks.

 

 

 

Delivering on NDC Ad

In my opinion, Global Distribution System (GDS) companies wield significant horizontal and vertical market power over the airline ticket market serviced by travel agencies. The GDSs have three primary customers—airlines, travel agencies, and third-party technology providers. Over time, the GDSs have intentionally crafted their relationships with their customers to build and solidify a market structure impenetrable to competition. This deliberate process was put in place as each commercial relationship came up for renewal.

The net effect of having a “tied-up marketplace” is harm to consumers. They find themselves having fewer airline product options and paying higher airline ticket prices than they otherwise would, given an open and competitive ticket distribution market. Additionally, the ticket distribution market suffers with a higher-than-necessary cost structure due to the GDSs blocking innovation and lower-cost distribution alternatives.

The Circle That Ties

To preserve their market power and block competition, the GDSs have implemented contractual hooks into each of their commercial relationships with airlines, travel agencies, and third-party technology providers.  Read the rest of this entry »

American Airlines’ new fare bundles reflect the growing popularity of airlines competing for consumers’ business through more personalized and unique airline product offers. We consumers just love choice, so this is a welcome change from the one-size-fits-all, commoditized airline product based solely on fares and schedules. Consumers can now pick the product that best suits their needs for a particular trip. Nice, huh!

Okay, now for the nuts and bolts. American Airlines now displays its new products on AA.com and through its Direct Connect. They also state that it has made the bundles available to the GDSs. So far, so good. Both Sabre and Travelport say they now can display, sell, and ticket Americans’ new bundled products. Again, all good.

So let’s just see. No seriously, let’s see it! Lately we are all so focused on transparency, full disclosure, and no secrets. Okay, some in the industry like secrets—secret projects[1], secret boycotts[2], secret meetings[3]. But I say, no secrets! Let’s see how the selling of these bundles actually works in the Indirect Channel. So, we’ll show you ours—right here, right now. Here it is. Screenshots are below. Don’t like pictures? Check out our YouTube video of a fully transparent booking of American’s product bundles.

Okay, now let’s see yours…

SPRK1

SPRK2


[1] October 24th p35 lines 16-26 and p36 lines 1-11

[2] October 24th p 28 lines 1-2

[3] October 24th p49 lines 20-25 and p50 lines 1-17

Great article exposing ulterior motives behind the Open Allies lobbying effort and the overall DOT fight. It is refreshing to see some bold reporting in the travel space!

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Virtually everyone agrees that travelers need to be able to compare the true cost of airfares, plus baggage fees and seat selections, in a transparent manner without getting gouged along the way with hidden extras.

Open Allies for Airfare Transparency, a coalition of industry associations, corporations and travel agencies, advocates that the Department of Transportation step in to ensure that airlines distribute all of their seat and bag-fee information through the GDSs. Open Allies is making much of a Harris Interactive 2012 traveler experiences survey that found that 94% of the 2,310 adults queried who booked summer travel using an online travel agency endorsed the notion that “all airline fee information should be available to travel agents and online travel websites.”

The online survey, conducted September 4 to 6 by Harris Interactive, was commissioned by a founding member of Open Allies, the Interactive Travel Services Association, whose members include global distribution systems such as Sabre, Travelport, and Amadeus, and their OTA clients, including Expedia, Orbitz Worldwide, Priceline, and Travelocity.

Lots of allies doing the GDSs’ bidding

Founded in early 2011, Open Allies, too, despite its roster of nearly 400 trade associations, travel agencies and corporations, has been spearheaded by the GDSs, the American Society of Travel Agents, and the Business Travel Coalition, all of which have collaborated before on similar lobbying efforts. The stakeholders’ primary interest is making sure that the current methods of airline ticket distribution remain the same and that airlines do not sell direct to consumers — even if that lowers prices for consumers.

Read the rest of the post at skift.com.