Monday, May 29, 2023

NDC takes flight: Oman Air’s Plan for next-generation Airline Distribution

Oman Air, the national airline of the Sultanate of Oman, was among the early adaptors to IATA’s New Distribution Capability (NDC) with a goal to improve their customer experience and streamline the booking process by providing more relevant and personalized travel options to its customers. Since then, the airline has made several inroads in their NDC journey becoming one of the first airlines to implement and enable IATA Pay and to be awarded the ARM Index Certification globally.

Speaking exclusively to, Umesh Chhiber, Senior Vice President Revenue Retail & Cargo, Oman Air takes us through their NDC journey and what lies ahead for the future of airline’s distribution.

Where are you on your journey to full adoption of NDC?

Oman Air has always been at forefront of embracing new distribution technologies. We started our NDC journey in the year 2018 and went live in January 2019. Over the last 4 years, we have elevated our NDC platform capabilities with several functional and Schema enhancements to attain the “Airline Retailing Maturity” (ARM) Status. Oman Air has been one of the very few airlines globally who have been awarded the ARM Index Certification.

Has your perspective on NDC changed since it was first launched? What do you plan to do differently?

Being an early NDC adopter, Oman Air knew that NDC is going to be one of the most disruptive technologies offered to Travel Trade. Post our go-live in 2019, we quickly accelerated our pace by making the correct strategic decisions in an effort to significantly scale up on our Direct Channel volumes. As we expand our direct channel content, its resulting in significant Distribution Cost reduction for Oman Air. 

Oman Air Management is working towards a plan to quickly scale up on our NDC volumes in the European, US and Asia Pacific markets in the next few months by providing advance NDC APIs to global OTAs, TMCs and aggregators through various technology partners. Apart from this, we have an aggressive plan to provide differentiated preferential content through our NDC channel in the coming months. Oman Air already differentiates content in the domestic market.    

What’s the next phase for Oman Air’s distribution strategy? Do you believe the NDC rollout to still be a viable alternative for customers too?

Oman Air is willing to work with all technology providers who can strongly demonstrate their capabilities and fulfil our Offer and Order Management (OOMS ) vision of 100 per cent Offers and Orders by 2030. We strongly believe that NDC would be a viable alternative for our trade partners as well as customers, as well as becoming a valuable contributor to our end vision.    

Could you tell us about the development of the Offers and Orders consortium that IATA formed?

Oman Air is extremely privileged to be a part of the consortium of 12 airlines to lead the transformation to Modern Airline Retailing. Both IATA and the consortium airlines realise that moving towards a world of Offers and Orders only, free of legacy artefacts such as ETs, PNRs and EMDs, is an immense task. It requires commitment at the highest levels from various airline verticals. This consortium has been formed to obtain full support from all airlines and tech partners (incumbents and potential ones) to build an appropriate business case and to consider aspects that are more difficult to quantify, such as the risk of doing nothing and the current inefficiencies in business processes. Oman Air strongly believes that 100 per cent Offers & Orders along with One-Order would benefit the entire travel industry by modernising legacy processes, and we are commitment to make it a reality. The airline industry is now well on its way to being an intelligent retailer and is taking steps in that direction, which other industries have taken much earlier.

What are some of your key learnings from all the news at American and/or Air Canada?

There are no right or wrongs in this journey. Each airline will have its own path, whether it’s an aggressive roll-out or a gradual one. It is relative to the absorption in the respective markets. Bigger carriers obviously help to elevate the visibility and importance of the NDC expansion. 

There has been much talk about adoption challenges for corporate travel? What, in your opinion, is key for better NDC penetration on corporate travel?

In our opinion, a hybrid world of traditional airline distribution methods and NDC-driven channels is likely to exist for some time. Implementing NDC content into TMC workflows presents a minefield for corporate travel managers. With all major airlines providing negotiated content, there needs to be a more efficient way for these savings to be passed on for business travel bookings. A wider adoption of the NDC standards across the airline industry will mean that travel managers not working with NDC-enabled providers will increasingly find they are not offering full content to their end users. TMCs have their own role to play in encouraging the adoption of the NDC standard and driving change. It’s time to move on from talking about industry nuts and bolts to offering and selling content to business travelers, in an efficient and profitable way that best fits their needs.

Oman Air also enabled the IATA Pay payment in India last year. What value has that brought and are there plans to roll it out to other markets?

As mentioned, Oman Air has always been at forefront of embracing new distribution technologies.  We were the first airline to implement and enable IATA Pay as the alternative form of payment on our NDC Channel. We implemented it first in India, followed by other key markets globally. IATA Pay is a real-time highly secure bank transfer payment method that leverages UPI (Unified Payment Interface). Using IATA Pay, travel agents can provide a seamless payment experience along with safety and security with no costs associated.

Once the integration is completed by the IATA Pay Team, we plan to launch IATA Pay in Oman and other GCC markets over the next few months. We strongly believe that activating IATA Pay in GCC markets will enable us to significantly increase our volumes since most of the non-IATA agents prefer using this highly secure and real-time payment option provided by IATA. We are grateful to IATA, especially Mr. Amine Boulaghmen, IATA Head of Payment Facilitation Solutions, for all the support.

What is your opinion on FinTech taking the lead with modern airline retailing?

It’s no secret that the airline industry is undergoing a major transformation. Customers are demanding more choice, convenience and personalisation in their travel experience. Competition is intensifying from new entrants and alternative modes of transportation. Moreover, technology is evolving rapidly and creating new opportunities and challenges for distribution and communication. The answer lies in Airline Retailing, a customer-centric approach that allows us to offer more personalised and differentiated products and services to our customers across different channels. It will also enable us to generate more revenue and value from our core and ancillary offerings. 

IATA has set 2030 as its vision to achieve modern airline retailing. Where do you see the regional airlines, including Oman Air, by 2030?

In our opinion, the timelines set by IATA are realistic and if all industry partners work towards the vision, we can surely achieve modern airline retailing by 2030. We are totally committed and aligned with IATA’s vision and Oman Air is moving resources and budgeting appropriately, in our journey towards modern airline retailing. We are working closely with IATA and are appreciative of their support.

How have conversations with travel agents changed over the last few years, to ensure they will continue to have the best access to NDC content?

When Oman Air launched its NDC Channel in 2019, it was indeed a challenging task to convince travel partners to book Oman Air content via the NDC channel. Since travel agents globally have been using the legacy GDSs for decades, they were reluctant to adopt NDC technology and cited the limitations of NDC adoption. However, in time, IATA has introduced improved schemas that are elevating adoption.

Oman Air introduced several agency-friendly initiatives along with content differentiation to convince travel partners to book through our NDC channel. As we stand today, our NDC volumes have tripled over the past 4 years. Our vision is to increase NDC volumes to the high 30s over next 2 years, and into the 70s by 2030. 

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