The IATA’s New Distribution Capability (NDC) has aimed at helping airlines become real retailers since the start, for several years already.
The “new” world is starting to become a reality, with 45 airlines NDC certified and a leaderboard of the most advanced 20 airlines committing to make 20% of their indirect sales through NDC API in 2020.
Nevertheless, the vision may be clear, but the path to reach it remains to be defined for many.
In October 2018, the IATA ran its first Airline Industry Retailing Symposium in Rome, Italy. NDC/One Order was the center of discussions, covering all dimensions, from technology to organisation. Many attendees at the Rome event were looking for insights to take back home to their own NDC project.
Conztanz and three other companies (InteRes, Datatrans AG and Lufthansa Systems) were invited to take part in a panel discussion (entitled “What could it look like tomorrow? Best-of-Breed Innovation in Airline Retailing”) and share their vision with the attendees on how to get full benefit from the NDC world, to “Innovate with Speed”, defending a best-of-breed approach that becomes scarce in debates.
Who was on the panel?
- Hélène Millet, Head of Consulting & Airline Products at Conztanz
- Alexander v. Bernstorff , Director of Airline Solutions at InteRES
- Urs Kipfer, Head of Key Account Management, Datatrans AG
- Peter Schöber, Director Revenue Management & Pricing, at Lufthansa Systems
- Ursula Silling, Founder and CEO, at XXL Solutions (panel moderator)
4 Key insights from the panel discussion
Here are four ideas shared by the innovative companies presenting
1. NDC implementation cannot be partial
NDC / One Order environment could bring many opportunities to simplify and enhance the industry’s processes, and might not, if the entire end vision is not implemented.
It is not a question of copying and pasting today’s processes. Modern digital retailing for airlines should be free of typical limitations found in the traditional model. Simplification and efficiency are mandatory to move forward.
2. The best-of-breed approach
In the early times of NDC, all participants agreed that moving to NDC would allow new stakeholders to enter the game, that putting together several specialists together could bring better innovation than contracting with a one stop shop provider. This idea was underlined in the panel: each of the four companies that participated specialized in a specific domain. They are really focused and know what they can and can’t do. This makes their processes transparent for the airlines who want to work with them.
3. Flexible and easy-to-integrate architecture
NDC architecture includes mini functions, such as dynamic pricing, offer, order, payment (and PCI compliance), and uses a cloud architecture. It was presented by IATA from the early days as “lego like”: easy to integrate, with a high flexibility. Not every airline integrates NDC into their processes in the same way – yet the panellists agreed that the most important step is to start experimenting with the technology, on a try-and-fail mode. Airlines may choose to collaborate with one, two, three or four of them to solve specific parts of the NDC puzzle (using NDC messages as a common language between them), and integrate with the rest of their IT environment, or even with another provider.
4. Moving to NDC is not a one shot process : transition is key
The panelists agreed that the deployment of NDC is not a ‘big bang’ but an evolution. NDC and non-NDC channels are likely to coexist for a long time. Therefore, from day one, flexibility should be ensured between the two types of channels. Transparency for the customer, no matter which channel he/she chooses to buy on, is essential.
With its Travel Data Agility Platform, Conztanz ensures a smooth transition and allows airlines to gather comprehensive data from the NDC and non-NDC world right from the beginning:
- From NDC : NDC Order detailed data is mandatory to be able to serve the customer properly
- From Non-NDC: PNRs are the key source to get data from.
NDC is here – now’s the time to prepare
The IATA’s NDC initiative offers serious potential benefits for airlines – for instance by increasing ancillary sales. However, they need to understand what is possible as an end vision, to define what their main business needs are. It is a matter of not being afraid of stepping out of their comfort zone.
Once the end vision clarified, they then need to build a solid strategy for NDC roll out: transition is mandatory, but it is possible to handle it properly, without any negative impact on the end customer. The panel discussion in Rome clarified how quick and innovative solutions of NDC roll out are possible.