Saturday, June 15, 2024

A focus on Offers and Orders in Modern Retailing

With the evolution of modern airline retailing, the journey has revolved around the crucial aspects of refining offers and streamlining orders.

This process began with the inception of the industry standard, New Distribution Capability (NDC), in 2015. Fast forward to the current phase, the industry is advancing towards a realm where 100% of airline transactions are centered on optimizing offers and fulfilling orders.

This will give prospective air travelers full transparency and visibility on airline products and services, regardless of whether they shop directly with the airline or via a travel agent or online travel seller.

To propel this journey, IATA established a Retailing Consortium comprising advanced airline adopters. From pushing a case for modern airline retailing, highlighting the potential for revenue enhancement, cost reduction, improved customer satisfaction, and operational simplification, the consortium is now looking to push airlines to implement offers and process orders.

The latest milestone is the release of a comprehensive whitepaper titled “IT Provider Readiness and Airline Transition Pathways.” This document meticulously details potential IT transition pathways. It offers crucial insights to equip all airlines with essential background information, empowering them to realize their retailing ambitions.

In an article in IATA’s magazine Airlines, Olivier Hours, IATA’s Head of Distribution Strategy, underscores the significance of this whitepaper: “The extensive input from 15 IT providers, comprising over 40 hours of detailed conversations and 30 pages of written responses, encapsulates a clear understanding of the challenges and solutions in modern airline retailing and order fulfillment.”

All participating IT providers have endorsed the whitepaper, including both established players and emerging contenders, showcasing the vibrancy and competitiveness within the retailing landscape. Their unified endorsement emphasizes the collaborative approach and underlines the need for ongoing industry engagement as the retailing journey progresses.

The whitepaper serves as a guide, explaining the steps required to establish a unified customer order record. It builds upon the existing standards developed as part of the ONE Order initiative, covering the booking process, payment handling, and order delivery stages.

This progressive approach aims to eliminate technical challenges caused by disparate artifacts like passenger name records, e-tickets, and electronic miscellaneous documents. These artifacts, although crucial in existing processes, present synchronization issues and are becoming obsolete from a customer perspective.

The document marks a tipping point, fostering awareness and readiness for the airline IT transition. Acknowledging the numerous interdependencies in the ecosystem, the paper focuses primarily on the airline’s journey. It advocates a gradual transition, allowing modern and legacy environments to coexist, ensuring uninterrupted business operations.

The proposed transition involves launching new modules in a shadow mode, progressively taking-over use-cases from legacy systems until they become the default. Ultimately, legacy environments will be decommissioned, and translation services will enable interlining between airlines at different stages of their retailing journey.

Hours emphasizes, “We are at a turning point with a strong consensus on the need for change, supported by evolving technology.” Moving towards modern airline retailing places airlines in control of their products, finances, and data, ultimately benefiting the customers. This evolution promises customers seamless access to ancillary services within a unified order, offering personalized and convenient experiences across different channels.

The readiness of the industry for modern airline retailing, with a clear business case, reference architecture, and an implementation guide, signifies critical tools for airlines to embark on this transformative journey. Hours acknowledges the complexity but stresses the importance of meeting customer expectations for a modern and efficient shopping experience, regardless of the channel.

While not every airline may immediately embrace modern retailing, it’s evident that the market is shifting in this direction. Airlines, along with other industry partners, must align their strategies, considering how this transition impacts various stakeholders in the value chain, including travel agents, ground handlers, and rail operators.

Continuing collaboration and commitment remain pivotal for achieving true customer-centric operations. The landscape is evolving, and the time is now for airlines to strategize and initiate implementation towards the retailing end-state. IATA and the Retailing Consortium will continue refining guidance and anticipate further exploration into potentially phasing out specific artifacts, such as check-in and reservation booking designators.

Hours concludes, “Collaboration and commitment are pivotal in achieving true customer centricity. The IT providers recognize that the monolithic PSS (Passenger Service Systems) will evolve or diminish. It’s time for many airlines to explore and strategize towards the retailing end-state and initiate the implementation process.” Access to the whitepaper and other Retailing Consortium resources is available for further insights.

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