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

Posts Tagged ‘travel distribution’

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Wow, look at all this fuss being made over the IATA NDC (New Distribution Capabilities) initiative. And I was so much looking forward to some R&R over the holidays.

Before we start, you need to know that I have not been a glowing fan of some of the IATA moves over the years, but this initiative—NDC—is one I think is rather insightful and extremely helpful not only for our airline industry but also for consumers, third-party developers, and travel agencies alike.

So let’s start to unravel the fuss with an understanding of what a schema actually is (in this case, a technical development schema) because I am pretty sure that most of the folks making all the fuss have most likely never worked with a technical schema or probably even seen one in real life. (I have attached a piece of a schema below so now they can attest to at least seeing one). A technical schema is a roadmap with very specific directions that, if you follow, will get to where you want to go–technically speaking, that is. In other words, an XSD schema file (XML Schema Definition) defines the structure of an XML message/document to include, for example, elements and attributes (child elements, order and number of elements, data types, and more).

For example, let’s say you are at the zoo and you want to go see the zebras. You will probably start out looking at a map of the zoo. If you follow the path defined for you by the map, you will undoubtedly end up seeing zebras and not those pesky hyenas by mistake. Same concept applies to a technical schema. In our case, a technology developer wants to accomplish certain tasks by connecting to an airline’s internal system to request a seat map, or retrieve a PNR, or make an exchange, etc. The schema simply provides the predictable technical pathway to accomplish the task at hand.  Read the rest of this entry »

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In some ways we (the industry we) are so predictable. I am referring to the very recent breaking news from Abu Dhabi that the IATA membership has directionally endorsed and approved that the organization is moving ahead with its NDC initiative. For those of you not familiar with this particular acronym, it stands for New Distribution Capabilities.

And, as quickly as those voting for the NDC initiative to move forward could drop their hands back into their laps, we see two industry groups—ASTA and Business Travel Coalition (BTC)—publically coming out against NDC. It’s almost as if this reaction was planned ahead of time… (Let’s see, the vote was Thursday morning, October 18, Abu Dhabi time, that’s 9 hours ahead of EST. Tnooz published on October 18 at 8:24 am ET and The Beat published its story at 7:24 pm ET, so if I carry the 1, I get… I don’t know. I was always bad a math. But the point is, this denunciation of NDC was all ready to go before it was even voted on.

For those of you that didn’t have the chance to read the articles, allow me to summarize (in my own words, of course)… “NDC is bad, we don’t really know what it is, but we know it is bad, so stop doing this bad thing!” Read the rest of this entry »

TakeTravelForward recently posted an article on airline distribution and how it is time the industry shift to a consumer-centric marketplace as opposed to one where an intermediary controls the product offers to airline travelers. They also produced a series of videos on the same subject. We thought it was worth reposting on our blog in case you missed it. Enjoy!

 

Today, airlines are competing for consumers in ways never imagined just a few years ago. For decades much of the airline industry had been relegated to a commoditized offer of an available fare and schedule. In fact, the inability of airlines to differentiate their product offerings led to what many viewed as a “race to the bottom” in terms of innovation, service, and the entire experience from “buy to fly.”

But why did this happen? Did the airlines really want to give consumers a bad experience? Of course not. They simply could not maintain profitability in an era of rising fuel prices and a mass commoditization of their product.

The turmoil in the industry today reflects that the pendulum is now swinging back, as airlines strive to offer consumers new and better travel experiences that are unique to the airline. But the shift is not so easy, and there is friction across the industry. While airlines are willing to share any information necessary to deliver customized offers to travelers, friction is inevitable as airlines try to achieve these changes against a backdrop of an entrenched business model that may serve the dominant industry intermediary (the GDSs) well but has left consumers as a mere afterthought.

Today’s consumers are unique and different, and so are their trips—vacations, business trips, weddings, and more. Consumers want to be treated special, rewarded for loyalty, given options and choice, and know they’re getting the best deal.

The Internet has given us the power to search and comparison shop for the best deal, and the notion of “one-size-fits-all” has been replaced with “Real-time, Transparent and Personalized.” Consumers enjoy and expect these benefits in today’s transparent retail world, and it should be no different when they search for and purchase air travel. Now is the time for the travel distribution industry to join in.

 
Episode 1: Do You Really Know What Happens When You Shop For An Airline Ticket?

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Earlier this month, I had the privilege of attending and presenting at the Department of Transportation’s Advisory Committee on Aviation Consumer Protection hearing. The objective of the day was for a hard-working advisory panel to get input from a variety of industry folks on whether or not to recommend some form of new regulation concerning the sale and distribution of airline ancillary products and services as it pertains to travel agencies—both traditional brick and mortar travel agencies as well as online travel agencies such as Expedia, Orbitz, Priceline, and Travelocity. The lines were clearly drawn between those advocating a free market approach where innovative and competitive distribution technology solutions empower full consumer transparency, choice, and personalization versus a government-regulated approach that could easily end up dictating both technology requirements and a commercial model clearly favoring the status quo. I am sure you can guess which side I came out on….

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What I found most interesting was a presentation by Sabre where they proclaimed to the panel that they have solved the problem of offering and selling airline ancillary services (or “fees” as they like to call them) through the Sabre travel agencies. They exclaimed, “The shelves are built!” They went on to say that all Sabre needed to “fill the shelves” of their travel agency selling software was for DOT to adopt a new regulation that would force the airlines to give them all of their ancillary data, in a format that matches up with the way Sabre chose to build their selling system. That’s right: if the airlines would just agree to sell their products the way Sabre wants them to, everything would be a piece of cake. Hmmm…whatever happened to the concept of building a better mousetrap instead of telling the mouse to just stand there while you trap it?

Anyway, back to that piece of cake. After measuring, mixing, and baking, Sabre was ready to pull that piece of cake out of the oven and put the icing on with a product demonstration. They initially positioned the demo to the panel as “here and ready for agency use.” Many of us in the audience had seen this presentation before, on YouTube and GBTA-sponsored webinars. Read the rest of this entry »

During the Innovation in Airline Distribution 2012 conference I had the pleasure of listening to a couple of lawyers talk about the ongoing litigation between the airlines and the GDSs, and I didn’t even have to pay for it. It was great, and it actually led to a bona fide epiphany. Here’s how it went down:

One of the attorneys was making a general reference to the competiveness of the GDS industry and commented that “the GDSs do compete very aggressively against one another by spending millions on agency incentives.” An innocuous and no doubt accurate statement, right? The GDSs spend millions of dollars (of the billions of dollars they collect in distribution fees from the airlines each year) to allegedly compete against each other. Big deal. But then it hit me like a 2,000 page legal brief.

 

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If the GDS spend all this money competing against each other for travel agency business, then how much do the GDSs spend competing for airline distribution business?

This question now haunts me. I am sure it will consume most of your waking hours just as it does mine. So let’s try to answer the question. Hmmmmm… better get out the abacus for this calculation. Read the rest of this entry »

Did you know travel agents are working around the GDS to meet customer demand for booking airline ancillary products and services? In fact, “nine in 10 corporate agents and more than 70% of leisure retail agents have booked air ancillaries over the past year.”

Wait. That quote can’t be right. I must have read it wrong. Due to technological limitations that restrict the meaningful display of ancillaries in the GDS, almost no airline ancillaries are available for sale through GDSs. I know because the GDSs and their allies are trying to push for government regulation to require airlines to distribute and display their ancillary products and services through the… well, let’s just say the less-than-modern GDS channel.

But no, I read this recent Travel Weekly article three times and that’s what the quote says. The article reports on a PhoCusWright study that states, among other things, “Agents’ willingness to book [ancillary products] without compensation implies that the demand for handling ancillaries as part of the flight reservation is customer-driven.” So there we have it! Despite these agencies getting no help from their GDS, they are finding ways to sell ancillaries. It’s really no surprise when you think about it. Travelers, like all consumers, want choices and options, and travel agents are once again demonstrating resilience when it comes to meeting the needs of their customers!

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On the drive home from work the other day, I listened to a fascinating story on NPR about television. It wasn’t about the best shows of 2012, or about content at all, really. It was about the way we watch television and, more specifically, about how we will watch television in the years to come.

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But it’s TV. What’s left to change? We’ve already gone from antenna to cable and satellite. The viewing quality has greatly improved from analog to digital to HD to even 3D. And we have more and more channels, which for me is just more and more channels I don’t watch but have to pay for to get the five channels I actually like to watch. So what else can really change? Apparently everything. Read the rest of this entry »

With a new year upon us, the air [pun intended] is filling with talk of Airline Strategy 2012. With hundreds of airlines all over the world, there is no doubt a tremendous amount of strategic discussion going on. And I’ll go out on a limb and say at least some of that discussion centers on Airline Direct Connect Distribution. But with all the information, misinformation, uncertainty, and controversy pinned to Airline Direct Connect, how is anyone really in a position to determine if it is, in fact, the right move?

In our never-ending quest for transparency, we thought we would do our part to help answer the question, Is a Direct Connect Strategy Right for Me? And as with any good quandary, providing answers to a simple set of statements can provide you with instant enlightenment and direction. After all, this methodology has been employed by many social sites and popular magazines to determine if our love lives could be better, if he’s cheating on us, and how sexy our names are. So it can clearly solve something as simple as, Is Direct Connect Right For Me? Read the rest of this entry »

Last week, I decided that I really needed a 3D television and, of course, all the trimmings to go with it to make it a total sensory experience – funny 3D glasses, a new 3D surround-sound system, and, of course, the smell-o-vision option. With the holidays closing in, I had my perfect cover – The Family Gift. They would love it. What would be better than the family sitting around the new 75-incher, basking in its warm glow while watching and smelling Harry Potter 12? Ah, I love the holidays.

Since I really despise actually going into a store, I decided to make my Family Gift selection online. As I began my search, I came across a number of aggregation sites that displayed price ranges for certain brands and models, but honestly, those sites weren’t of much help. I mean, telling me that the Mitsubishi TV is $4,140 – $6,000 isn’t terribly helpful. And those sites certainly didn’t take into account any personalization like my favorite places to shop online for electronics, and that I am a Costco member, and a Best Buy Rewards geek, and that I have a Fry’s credit card. But how could they? These aggregation sites know nothing about me. So naturally all they can serve up is a very generic display of something I may or may not want – the same display they provide to every other shopper looking for the same thing.

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