Friday, September 30, 2022

Leading NDC and the future of travel retailing: Amadeus

The aviation industry has seen a radical leap in the last few years, strengthening their offering in line with the changing requirements and demands of an ever-more discerning consumer market. When IATA launched the New Distribution Capability (NDC), Amadeus was one of the first global distributions systems to deliver a full end-to-end integration of content via NDC connectivity.

Speaking to ArabiaTravelNews.com, Maher Koubaa, Executive Vice President, Airlines, EMEA, Amadeus says the company has always worked closely with IATA as well as their airline, travel agency and corporate customers to deliver NDC and make enhanced retailing a reality.

Last year Amadeus published a report dubbing 2021 as “the year of scaling” for IATA’s New Distribution Capability standard, citing airlines’ development and release of bundles and travel management companies going live with NDC content.

“Over the last years, and through our NDC [X] program, we have advocated for better standards, focused on delivering required servicing capabilities, ensured high performance at scale and collaborated to find new and exciting ways to transform the traveler experience.”

“We have laid the foundation for the future of travel retailing. NDC is just part of a bigger retailing evolution with One Order. There is high industry awareness and increasing engagement from airline and travel seller communities, to deliver NDC and the great opportunities it can provide. There are great benefits for airlines, travel agencies, corporations, and travelers. This is an opportunity for the industry to come on board with adapt to these new travel technologies and latest retailing capabilities.” 

“Despite this unprecedented crisis, NDC is even more crucial than ever. It is one of the paths to recovery and an opportunity to leapfrog into better retailing for the travel industry. NDC allows airlines, and in turn travel sellers, to offer more tailored services, up-to-date, relevant information and additional ancillaries to travelers, driving more value for the traveler and more revenue for travel companies” said Koubaa.

2021 has been a very busy year for Amadeus despite the global circumstances. According to Koubaa the pandemic put the spotlight on the many benefits the NDC standard can bring, and that the industry needs now, more than ever – easier servicing and richer, more contextual offers.

At Amadeus, significant progress was made to drive NDC at scale. Some of their accomplishments in 2021 include:

  • 18 airlines being implemented in the Amadeus Travel Platform, of which four are live and one piloting, and 13 airlines live with Altéa NDC and 20 more currently being implemented – so the foundation for travel retailing is stronger than ever.
  • 5,000 travel agencies in almost 60 markets who can now book and service airline content via NDC using Amadeus solutions. Amadeus is on its way to making NDC-sourced content available to all their travel seller customers around the world by early 2022.
  • In Q4 2021, the company signed NDC content deals with Cathay Pacific, Avianca and Viajes El Corte Ingles.

“Travelers today want simple, clear, and personalized offers. Amadeus can provide this as all content via NDC connectivity is integrated in our re-engineered Amadeus Travel Platform together with content sourced via other technologies. Travel sellers can compare and manage all content in the same way in one merged display,” added Koubaa.

Amadeus provides a unique difference with their technology. Especially integrated alongside other travel content, the simplified flow, and specially the servicing capabilities and end-to-end integration, makes Amadeus a preferred option for travel sellers.

“Other players don’t allow end to end integration and  servicing capabilities are also really limited for them. At Amadeus, we provide unique functionalities as aggregator,” he added.

NDC opens a whole world of opportunities for travel sellers. From new, richer, and more tailored-made content – that is delivered to travel sellers faster; one simplified flow – to efficiently search, book and manage content via NDC; content integrated alongside other travel content – in one merged display for easy comparison; Amadeus servicing capabilities and end-to-end integration – into travel sellers’ existing environment so they can seamlessly run their business and a futureproof, scalable solutions with on-going investment – the benefits with Amadeus are many .

“There are several concrete, real life examples of NDC bringing such opportunities in the industry today – ranging from simpler promotional messages, to new ancillaries like tastier in-flight meal options, to additional frequent flyer information, allowing much simpler cancellations or changes and dynamic price calculation,” he added.

Looking back 18 months, Koubaa says its clear that despite the strain caused by the pandemic, the industry has not sacrificed its commitment to NDC.

“In September, we released a report, ‘NDC 2021 and the path to industrialization’ that was designed to shed light on where we are today as an industry in terms of NDC readiness, the barriers that still exist to reach full industrialization, and show what can be done to accelerate the journey to modern retailing.”

“Based on this report, we identified several barriers that the sector will need to overcome if it is to accelerate NDC further. Firstly, we found that standardization continues to be a major challenge, with a growing desire for airlines to focus on a single version or interpretation of the NDC standard to limit downstream complexity. However, we are confident that version 21.3 of the standard – which will be released later this year – is the one that the industry can unite around.” 

“Our research also found that mid- and back-office system transformation remains a sticking point, particularly for corporations that need booking data to seamlessly flow through these systems, before finally reaching their own accounting systems.”

“Alongside the need to prepare airline systems and reach commercial alignment across the industry, a culture shift is also required for NDC to be truly effective. There’s a whole new language that comes with NDC and a completely different set of behaviors that sellers need to apply, but for an industry that has been working in a certain, specific, and structured way for the last 30+ years, transitioning isn’t going to happen overnight,” said Koubaa.

Airlines are making the most of this new potential and this is evident with the ‘innovative new fare bundles’ that help ease steps from the booking and expense processes and are based on richer contextual information, which can be accessed during shopping.

“American Airlines has been one of the pioneers. Through NDC, it can work with its large corporate customers to design tailored offers for subsets of employees, such as, special packages for senior managers of a corporation. British Airways on the other hand, has introduced additional price points using NDC with small increments between fares within booking classes. For travel sellers looking to source the optimum deals for corporate or leisure customers, NDC now delivers new levels of price flexibility,” he added.

In spite of the progress, Koubaa agrees that the journey has just began and that differentiated content available currently is still quite limited. But like all big changes, adopting NDC requires a different mindset.

“The reality is NDC brings about a change in the familiar ways of working, and this requires acceptance and time. In practice it means forgetting about bookings and PNRs – and moving to think about offers and orders. If you have been working in a specific way for the past 30 years and are asked to start working in a completely new environment, there is bound to be a bit of trepidation.”

“Transitioning from the classic and familiar environment to a retail-oriented next-generation one is a sophisticated process and a change in mindset and way of working is needed from both airlines and travel sellers. Through collaboration, we can rebuild travel to be bigger and better than ever before, to deliver value across the whole industry. In this sense, a culture shift will be needed for NDC to achieve 100 per cent effectiveness, said Koubaa.

The buck, however, does not stop there. IATA recently announced a new update to measure NDC adoption with the Airline Retailing Maturity Index, a new standard that measures the progress in air travel retailing and is structured around three key pillars: capabilities verification, partnership deployment, and a value capture compass.

Amadeus is a registered member, both as an airline and travel seller provider under the Airline Retailing Maturity index (ARMi).

“Ultimately, as an industry we need to strive towards richer, more tailored, and more relevant travel offers to speed up recovery. We have so far seen some initial successes selling ancillaries and bundles through NDC, but the ability to sell more personalized offers still remains mostly untapped. We see this index as a positive development that can accelerate the transition towards this goal,” said Koubaa. 

Amadeus is committed to innovation, cutting edge technology and leadership on NDC and retailing, and being dually registered in the index is another proof point that the company is headed in the right direction.

“We sit at the center of the travel industry and continue to drive collaboration among all industry players. Transitioning from the classic and transaction-oriented way of working to a retail-oriented, next-generation environment based on NDC and ONE Order is a sophisticated process that will require a change in mindset and way of working from both airlines and travel sellers. Working together, we can rebuild travel to be bigger and better than ever before and to deliver more value across the whole industry,” added Koubaa.

While NDC has been adopted by most major airlines, some stakeholders have decided to slow down their development. According to Amadeus, the broader industry picture is still one of acceleration, scale, and optimism.

“Airlines are now beginning to differentiate with NDC, travel sellers are going live across the world and technical barriers are being broken down, which have all advanced in the last 18 months,” said Koubaa. 

“These findings are also backed up by an NDC advisory forum we held earlier this year, which involved our airline and travel seller partners coming together to discuss where NDC is in terms of the wider industry and how Amadeus can move it forward. Participants were asked about the impact COVID has had on their plans and 95 per cent confirmed that they very much felt that the industry was still pursuing NDC as a way forward for travel retailing and 100 per cent confirmed it was a strategic priority for them,” he added. 

Going into 2022, Amadeus will continue to innovate its technologies. While the pandemic may have accelerated new tech enhancements across the industry, the emphasis now is to rebuild travel to be bigger and better than ever before and to deliver value across the whole industry. 

“Digital travel retailing is undergoing significant change, and NDC, together with ONE Order are the foundation for this evolution. In the future, we envision self-service for disruption (even in cases of interlining, ancillaries or third-party content), easier partnerships between airlines and third-party content providers, tailored packages, dynamic pricing, easier settlements and more,” said Koubaa.

Amadeus is also committed to making a positive contribution to sustainable travel. This is possible by offering green solutions to calculate, control, reduce, offset and capture carbon emissions, and thus avoid compromising the future of the travel industry.

Global airlines are also adopting sustainable initiatives such as carbon offsetting and increase fuel efficiency and are turning to leverage the flexibility NDC brings in order to share this relevant information on their side in an efficient way with the corporations.

“We expect this would be an area where NDC might open the doors to a new way to communicate information which is extremely relevant for the industry,” said Koubaa.

Corporate travel will also benefit immensely from NDC, as business picks pace. Amadeus integrates content via NDC seamlessly into its online corporate solution tool, so business travelers can reap the benefits of a more exclusive and personalized content from airlines. Transparency, seamless booking and technology will play a big role in its comeback.

At Amadeus, content via NDC is presented together with non-NDC options so business travelers can compare and ensure they book the offer that best fits their needs. A consistent booking flow so booking content via NDC is no different from any other content whether it be on their desktop or mobile app; an end-to-end integration with the corporation’s travel agency so travelers are assured to receive the highest level of service from their agency; a scalable, future-proof and sustainable solutions that are easy to use by the travel manager and business traveler are some of the features Amadeus offers its corporate travelers.

“For corporations, we take care of the complexities of integration. We’re committed to be a stable and innovative technology provider that can deliver end-to-end integration with the performance, scalability, market reach, and global support in line with airlines’, travel sellers’ and corporations’ strategic objectives,” added Koubaa. 

Speaking about new travel trends, Koubaa said that today’s travelers are looking for safe, touch-less, friction-less travel while being conscious about how they travel.

“In the past we saw business, adventure, family and religious tourism here. Today, the Middle East is claiming back sustainable tourism with new, untapped destinations – a bigger offering to the traveler. PwC recently detected five new megatrends for the region: forces such as demographic and social change, a shift in global economic powers, rapid urbanization, climate change and resource scarcity, and technological breakthroughs presenting both opportunities and challenges to the tourism in the region.

“On the other hand, the UNWTO referred recently to regional travel initiatives such as the EU-funded programs offering the opportunity to visit stunning places which potential as tourism destination. Some examples include:  the artisanal salinas of Anfeh, in North Lebanon, which revitalization and business diversification also involves sustainable tourism development; and the village of Jab’a along the Palestinian Heritage Trail in Palestine where there’s an initiative to boost tourism attractiveness and associate local communities in benefitting from tourism-related income. Other projects include the creation of websites for outdoor activities in Lebanon; the use of gamification for tourism like the Gadara Spinner, a board game for players to dig in the history and heritage of Jordan’s archeological site of Umm Qais; or even platforms to connect locals and tourists through food.”

“The traveler in this part of the world is demanding and technology savvy. We have the content and the technology to make their travel experience a great one. Both inbound and outbound travelers rely on technology to make them travel in a safe way. Joint efforts by public-private parties are needed to reach the required solutions as soon as possible,” he concluded.

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