It’s time for a straightforward perspective with regard to NDC. To start, I strongly urge that every travel agent in Australia click here and visit this AFTA webpage.
Click on the link to read the report “NDC: Travel Agencies’ Enabler to Success “
Heed the call to action.
Why upgrade the technology
Airline systems are pre-Internet . XML or extensible markup language has a very cute definition. More below
In a nutshell, XML allows you to connect up your website to someone else’s database and make it work the way you want to. It’s a great way for connectivity to flourish. I’ve worked in technology for 15 years. roomsXML relies heavily on hundreds of XML connections back and forth to over 30 different wholesale providers.
So from a technology and efficiency perspective overall, this makes sense. You put technology in place to be more efficient and more profitable. Removing layers from transactions to lift profits.
Makes sense for who?
Who does this benefit the most and who is driving it? The same group obviously. Which is airlines? Better technology means they can get better product distribution through more channels with fewer steps. Per transaction, airlines make more money from direct sales. Naturally, you would want to maximise that interaction, right?
I think in 2013 in Sydney I went to a presentation about incoming ATAS. There were a number of speakers including someone from an airline who not had a bed for the past 56 hours but slept on planes, shaved, gone to meetings, presented and repeated. Unfortunately he loaded the wrong presentation meant for direct sales, not agents.
He finished with a statement, to a room full of travel agents, something like:
“Currently direct sales are about 60 percent, but we have a target to get that up to 75 percent and believe we have the potential to read 85 percent direct sales to customers. Wont that be great.”
Airlines want direct sales. You do not drive change to decrease your profit margins.
But let’s refer back to a cute little statement about XML “a markup language that defines a set of rules for encoding documents in a format which is both human-readable and machine-readable.”
Same feed, travel agent versus machine. The last time humans beat a computer at something like this was War Games. That was 1983 and not even Commodore 64’s were around. Computers are great because I can do things so much faster than humans and…
“Shall we play a game?”
The key question
The fewer steps in the supply chain, the less profit needs to be shared from income yielded from the end user back to the supplier. If you have lots of steps, everyone wants a cut.
Will travel agents benefit? There is no lie that this will make it easier for travel agents when booking multi-segments, with multi-products.
Will it benefit agents more in the long run?
No.
It will clearly benefit OTA’s and anyone who has the marketing budget to do extensive reach. Airlines will have a greater chance of going direct and using big data to optimise profit per transaction. This is not a criticism of airlines, it is simply a statement of fact.
Oh yes, some of that big data will come from travel agents bookings information.
What can agents do about it?
Go to www.afta.com.au for gods sake .Continue to be good at your job. Focus on customer service, support and knowledge. Continue to improve your skills at anything that a computer cannot do well.
Being human.
