like Amazon. The goal is to make airline marketing and selling more effective in both the consumer and corporate sectors. It is, almost without question, going to have an impact on the way corporate travel is managed in the future.
</THE 1MPACT ON_BUYER5> Buying Business Travel has written exten- sively about the topic over the last few years. It is surprising, therefore, to learn that some buyers still don’t know what NDC is. And of those that have come across the acronym, many are still not really sure if it means anything to them. In April of this year, the Institute of Travel and Meetings (ITM) surveyed 93 of its buyer members on the topic of airline dis- tribution and NDC. Three in ten said they had never heard of NDC, while half of the rest admitted they had no idea what it would mean in terms of budget control and compliance levels. To avoid confusion, NDC is not a system or a platform. It is a technology standard de- signed to enhance communication between airlines and travel agents. It will be open to any third party, intermediary, IT provider or non-IATA member, to implement and use. It will allow airlines to offer relevant, tailored, rich-content offers to bookers in all channels. Those offers could be made through the global distributions systems (GDSs), travel management companies (TMCs) and online booking tools (OBTs), otherwise known as the pillars of the managed travel environment. They could be made via new market entrants. Or airlines could target travellers directly. Yes, direct sell… cue policy leakage alarm
bells. Ian Heywood, head of global supplier strategy for travel tech giant Travelport, has some very direct advice for buyers, and everyone in the distribution supply chain. “Understand NDC and prepare to control it before it’s too late,” he warns. “Buyers and TMCs should not view NDC as a threat; it is an opportunity to do things better. It will only be a threat if you sit back and do nothing.”
<TR1AL_RUN> The NDC wheels are well in motion. In recent weeks IATA revealed that eight major global carriers, including Air Canada, British Airways, United, Qatar Airways and Virgin Atlantic, conducted NDC trials last year. They tested codeshare flights, insur- ance upsells and mobile bookings. Business travellers buying United tickets though the
50 BBT MAY/JUNE 2015
NDC is, without question, going to have an impact on the way corporate travel is managed in the future
in the history of airfare distribution, though didn’t pique the interest of many travel managers. At the time, the NDC project was clouded in confusion and controversy. Travel intermediaries complained they had not been consulted on the technology and its implications. The GDSs branded NDC an assault on fare transparency, limiting comparison-shopping and compromis- ing data privacy rights. IATA eventually conceded it had failed to communicate ad- equately with travel industry stakeholders. A breakthrough was made in the US
Amadeus GDS can buy extra legroom seats for the first time. Meanwhile, Swiss is cur- rently trialling the sale of packaged fares that include free checked bags, seat upgrades, and champagne onboard. Much more is expected throughout the rest of 2015. The experiments have come a long way since late 2013 when the first live NDC booking was made in China. The ticket, for a seat on a Hainan Airlines flight, was bought through a travel agency using Chinese GDS, Travelsky. It was a landmark moment
in January 2014 when the Open Allies for Airfare Transparency coalition (which includes the GDSs and a number of major travel agencies) and IATA finally agreed on conditions that the US Department of Transportation should include in its approv- al of IATA’s Resolution 787, the foundation document for NDC. IATA said it clarified its “commitment to the core principles of Resolution 787 regarding anonymous shopping, compatibility of existing data standards with the NDC standard and the voluntary nature of the standard”.
</The_1nvestor>
Abrar Ahmad is a partner at travel investment firm Travel Capitalist Ventures, which is partnering with IATA to provide a £5 million fund for managed travel innovations based on the NDC platform.
I’VE BEEN A CORPORATE TRAVEL AGENT and seen the opportunities and challenges first hand – this isn’t a theoretical exercise for me. The business travel market is yearning for solutions to address managed-versus-unmanaged travel, the changing role of TMCs, and the increasing demands of business travellers and corporates. I believe the NDC standard enables greater engagement between business travellers, TMCs and travel-tech providers. For example, flight search results contain personalised flight options, amenities, upgrades, pricing and change/cancellation details tailored to my frequent flyer status, company or the event I’m attending. If I have the highest frequent-flyer status on a Oneworld carrier and receive specific flight results and amenities – for example, a premium economy upgrade – unique to that carrier and my status, would that increase engagement? Yes. Do business travellers want to see these options? Of course. These examples just scratch the surface of what the NDC standard enables for business travel. As an investor, I see it like this: give business travellers a highly intuitive NDC-enabled, corporate-approved booking channel on a mobile app, with personalised flights, hotels and transfer options tailored to their frequent flyer status and purchasing history, and I know you’ll see higher engagement and conversion rates. Make that same business traveller jump through complicated hoops to get something they could do with one or two clicks on a – unmanaged – consumer app and you won’t. The NDC standard is not some magic solution for all corporate travel problems, but I do believe in its positive impact – and a strong return on investment.
BUYINGBUSINESSTRAVEL.COM
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