Saturday, May 28, 2022

FCM sharpens its NDC-game with new investments, focus on personalized travel

When Nicola Ping took over as Manager of Air Content and Distribution at FCM Travel, the corporate travel business arm of Flight Centre Travel Group, her goal was to drive the technology strategy for air content with the company’s partners and internal development teams.
As part of this drive for innovation, driven by technology, the company announced its new, strategic commercial arrangement to increase its investment in TPConnects, the Dubai-based software as a service (SaaS) business to 70 per cent, building from the 22.5 per cent equity investment, it took two years ago.

The increased stake in TPConnects firmly positioned the company’s corporate businesses at the forefront of the developments that are taking place in the distribution landscape. ArabiaTravelNews.com spoke to Ping to find out more about how NDC has brought a disruption into the traditional travel distribution models and how working with TPConnects will deepen its focus on travel content.

Q:  Tell us about the role of NDC in travel distribution today and how has this evolved over the last 2-3 years, since FCM was first NDC-ready?
During the pandemic, when airlines were facing huge losses and cost-cutting was the need of the hour, there was a lot of nervousness if the progress around IATA’s New Distribution Capability (NDC) would come to a halt, as there were huge costs involved. But what we actually saw happen was the opposite. While airlines were cost-cutting and many projects were brought to a halt , we saw that their efforts and commitment to developing their NDC content continued strongly through the pandemic.

I think the reason for that was that they knew when travel came back, the ability to offer more content to the customer and the ability to control their own distribution would be the way forward to ensure they got their market share over competitors.

The other thing that helped was IATA announced its new 21.3 convergence version standard – released late last year – that saw a massive focus on servicing. In a post Covid scenario, servicing had become the need of the hour. With border closures, travel restrictions and flight schedules still constantly changing, people needed the option to change their schedules. IATA’s new standard offered various features and enhancements that allowed for better retail value and helped address feedback better. This made a huge difference.

Now, with people traveling again, we are seeing a far higher number of NDC bookings than we did prior to the pandemic. This of course, also depends on the region. For e.g. for travel within the U.S. and Europe, where a lot of restrictions have been eased, travelers have become more confident about booking online but in regions where there may still be some restrictions, offline bookings take precedence.

Another opportunity that has risen is that, while traditionally leisure bookings required a lot less servicing than corporate bookings, leisure travelers travel less often and so they tend to be less loyal to a particular airlines. They are not familiar with the product onboard and booking through NDC  meant they got the chance to know and experience the product beforehand, adding value to their entire booking process.
 
For corporate travelers who travel so frequently and usually stick to their preferred choice of airline – it is more about making the content really relevant. As a large corporate customer, if you know your customer, for e.g. wants WiFi onboard, particularly if they have to pay for it themselves, NDC is a great opportunity to bundle the WiFi into their fare.

So, NDC truly allows for different types of personalization for different types of personalized travel.

Q: FCM has been in the news for its new acquisition with TP Connects. Tell us about your new partnership.
We have been working with TPConnects for a long time now. Our new acquisition gives FCM a 70 per cent stake in TPConnects, building on an acquired 22 per cent which was acquired in 2020.

From a FCM perspective, today we have a very strong relationship with TPConnects and equally so with GDS’s like Amadeus, and Sabre along with as other aggregators in different markets today. What is really important for us, is ensuring we continue to deliver the widest choice of airfares to our customers. In today’s competitive scenario, relationships between airlines and GDSs have become a bit more contentious. For e.g. we saw how Emirates recently pulled out their content from Sabre because they couldn’t reach a commercial agreement. As a customer, this is not something you understand. So, it is important for us to make the most of our technology and our relationships and ensure the customer does not have to worry.

Likewise, sometimes airlines offer cheaper fares online, or through their different GDS channels. If a customer is looking for that, we must offer it to them.  What TPConnects enables us to do is efficiently tap into their multi-source content aggregation platform and pull content from various sources, including GDSs, low-cost carrier direct connects, NDC-based connections as well as other third-party aggregators, and offer the best fares/ content to our customers.  

TPConnects aggregates these into a single ‘universal API’ to feed our agent-facing and traveler-facing interfaces allowing us to access the best of these fares for our FCM and Corporate Traveler brands. They have also been the sole supplier, offering their NDC content, published fares and low-cost carrier content, through a single API into Melon, Corporate Traveler’s digital platform.

So it goes without saying that they play a crucial role in our global supply strategy today. The idea that you bring more competition into what was traditionally a monopolistic market – is what the industry is achieving with NDC. Today there are various new aggregators coming up in the market and this is a good thing. A competitive environment not only drives down costs but it also drives up innovation. And that is what we want for our customers.

Q: Aggregators vs GDSs. What makes them unique in their offerings to FCM ?
Since the conception of NDC, the aggregators proactively jumped onboard because of API connectivity. It did take the traditional GDS more time but since they did, they have spent a lot of money on building scaled projects that have become solutions for the industry as a whole.

But if you look at the relative size – an organization the size of these GDS companies, is always going to move more cautiously than the aggregators. These GDSs are building a solution that needs to work seamlessly, efficiently and timely for thousands and thousands of travel agents globally. If you look at the aggregators, their customer base is much smaller enabling them to be more dynamic and allowing them to be more tailor-made to their customers.

Q: Tell us a little bit about the new brand refresh for FCM, your corporate brand.
Our customers have told us that we are unlike any other TMC in the market today. In the sense, we are flexible and unconventional and we don’t necessarily box them into limited solutions.
We didn’t think that was reflected clearly in the brand’s identity and so the new branding was aimed to highlight just that. The new identity is bold and reflects on that mindset of being flexible and unconventional and providing agile travel management services to our customers, globally and locally. We launched the new end-to-end rebrand across 97 countries, across all websites, customer communications and social media platforms.

Q: What new innovations can we expect to see roll out in the immediate future?
We are gearing up for the roll out of our new omnichannel technology platform. It is completely designed in-house and will provides a new way to engage with our customers. Our customers will receive a ‘globally-consistent’ experience from one centralized design which also allows them a lot of choice behind the scene. It is easier to use, has more efficient navigation tools and allows customers to choose at a modular level.
It also allows us to service and directly address customers’ pain points with current and legacy corporate travel technology.

The platform was designed to address six key pillars: a globally consistent booking experience; always available travel assistance; traveler safety and wellbeing support; sustainability; AI powered reporting and savings, and flexible integration capabilities.

The platform was developed following extensive research by FCM to understand the different concerns of our bookers and travelers. Our AI-enhanced chatbot tool Sam will also be integrated into the platform allowing for real-time assistance across the platform. Other features like the AI-powered reporting will allow for a search experience similar to that of Google- for action-ability of data and so much more.

We are really excited at the opportunities AI and the metaverse will bring us, allowing us to engage with our clients in a brand new way. At the moment there are so many new ideas and we continue to work towards developing this.

Q: How important is sustainability when it comes to your business practices?
There is a lot focus on sustainable travel policies in the current, post pandemic environment. For Flight Centre Travel Group and it’s travel brands, sustainability , accessibility and a duty of care is key to our business practices. It is a core pillar of our sustainable offering and we recently welcomed a Global sustainability officer to help drive our Environmental, Social and Governance (ESG) efforts and in turn help our customers achieve their sustainability goals.

The opportunities to do sustainable travel are different region to region. Like in Europe, the ability to choose train travel over flights are more likely because of the strong train network. In other regions, like Australia where the distance between cities is so much, that opportunity is just not there.

Our new FCM booking platform has been designed specifically to cater to provide relevant information to customers, that will not only provide them with sustainable travel options but allow them to track their carbon reporting and carbon offsetting information and make an informed decision at the shopping stage itself.

As a company, we are committed to ensuring our business practices remain economically, environmentally and socially sustainable, at every stage.

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