New Distribution Capability – known throughout the industry as NDC – has been around for nearly a decade, with a promise of bringing significant changes to the business travel sector by creating more dynamic and personalized offers for travelers. By and large, that drastic change has yet to happen, though it finally seems NDC is beginning to affect how corporate air travel is purchased and managed.
A big shift occurred last year when American Airlines pulled as much as 40 percent of its EDIFACT fares, redirecting them to NDC platforms, and then launched a direct-sell SME loyalty program, laying off most of its corporate sales staff. This move brought NDC squarely center stage for many travel buyers for whom it had previously been just a murky concept.
Indeed, ignoring NDC is not an option for anyone in the business travel industry anymore, says Greeley Koch, managing director of 490 Consulting.
“In the evolving landscape of travel, resisting the shift to NDC is not a sustainable option,” he adds. “It’s a pivotal moment to critically evaluate what aspects of your travel program are falling short and how they can be improved with NDC. Over the years, many of us have found ourselves defending our travel programs against claims of better rates available elsewhere. This challenge is re-emerging as content shifts away from traditional EDIFACT channels.”
Koch says that in advising his clients about NDC, he encourages them to take a fresh perspective when approaching it, as if they were learning about it for the first time. This suggestion stems from the fact that NDC has been discussed so extensively from various viewpoints – including those of TMCs, GDSs, and airlines – each with their own business models to defend or disrupt through NDC. And this dynamic naturally has bred a cacophony of different opinions and agendas.
“Therefore, I recommend starting from zero, focusing squarely on your company’s objectives and the kind of travel program you aspire to create,” Koch advises. “By continuously aligning back to your goals, you move away from merely maintaining the status quo and toward innovatively using a blank slate. This allows you to design a travel program that not only meets but exceeds needs in sustainability, traveler convenience, content availability and cost management. Dive in, and let’s redesign travel planning to be as forward-thinking as your ambitions.”
Neil Hammond, a partner with GoldSpring Consulting, agrees with the assessment that many travel buyers are now having to pay attention to NDC for the first time. “It’s been in the pipeline for ten years, but nobody has really taken it seriously until now,” Hammond says.
However, because NDC is a technology ‘standard,’ different airlines currently approach NDC in different ways, which causes confusion. So Hammond says he is instructing his clients to “really stay on top of the industry trends and what’s going on. See which TMCs and online booking tools are able to manage NDC content and what distribution channels they are using.”
Hammond also notes that further drastic moves such as what American did last year should not come as a surprise because “some airlines have determined there is so much more value by directly connecting with the end user – the traveler. The airlines, as a supplier, want a more direct relationship with the end user.”
This is driven in large part by the value airlines see in rewards programs, Hammond explains, and how they can offer more relevant perks and pricing if they know who the end user is when they book a ticket. “Airlines were blind [in GDS booking]. They didn’t know who the traveler was until the ticket was bought,” he says. “Knowing who the customer is extremely important to them.”
Seeking Seamless Consistency?
For traditional players in the business travel ecosystem, NDC is becoming a big part of their offerings. “We offer airlines’ NDC content through offline and online channels,” says Thane Jackson, SVP, global distribution strategy and supplier partnerships Europe at BCD Travel. “We look to deliver a user experience that integrates NDC content alongside other travel content as seamlessly as possible, including delivery of support for those bookings in an equally consistent way.”
Jackson points out that each airline offers and implements NDC slightly differently. “As the corporate ecosystem is comprised of multiple stakeholders that build a full end-to-end flow, NDC capabilities can and do differ per channel, tool and airline,” he cautions.
However, Jackson notes that NDC has thus far not fully delivered on its promise. “Clients understand that NDC can offer differentiated content. However, many also see that NDC does not yet provide the fully personalized offers that have been promised over many years,” Jackson says. “Not all clients are fully aware that NDC itself drives changes in existing processes and systems with associated costs of change, for their programs and their travelers.”
Elliott McNamee, VP of marketing for Amtrav says currently around 47 percent of their bookings are done through NDC, via either Amtrav’s proprietary booking tool, offline channels, corporate customers or their travel advisors.
Amtrav, says Elliott, embraces NDC technology, and in a report shared with the media, the company says it offered fare prices for American Airlines tickets at the same equivalent price buyers could get direct from aa.com – and lower than “legacy corporate booking tools.” Thus, McNamee says, “from the perspective of our customers there is no real difference between NDC and non-NDC.”
Travel technology company Sabre says there are currently 19 airlines globally that are live with NDC content in its systems, and it expects to have 35 airlines live by the end of 2024.
In terms of capabilities, Sabre is currently supporting end-to-end capabilities from shopping through to servicing, including cancel, void, refund and voluntary exchanges; multiple passengers and multiple passenger types; and seat ancillaries. Further enhancements and functionalities are on the 2024 roadmap and will be delivered throughout the year.
“NDC is a corporate priority for Sabre as a key enabler of personalized, real-time retailing based on offers and orders,” the company said in a statement provided to Business Travel Executive. “Sabre is one of only a few companies that operate as both an NDC aggregator and as an NDC IT provider. As a result, we bring a holistic perspective and deep knowledge to NDC forums. There, we advocate on behalf of advancement for the travel industry overall, not just for one link in the travel value chain.”
Sabre says it is “prioritizing the content and the capabilities that our agency and corporate customers really need.” According to the statement, “NDC implementations vary airline-to-airline. The Sabre team does the heavy lifting of managing this complexity so that our customers don’t have to – from maintaining multiple versions of NDC technical schemas, to accounting for country-specific tax guidelines, to supporting mid- and back-office workflow requirements.”
Travel technology provider Amadeus also recently expanded its commitment to NDC, with the company forming a strategic partnership with Expedia wherein it will deploy its NDC technology for the online travel agency.
In a statement, Amadeus says, “This multi-year agreement reinforces Amadeus’ commitment to accelerate the industry evolution towards modern, enhanced retailing, and to help the travel ecosystem to deliver value that supports both industry growth and an improved traveler experience.”
Sam Abdou, executive vice president of global sales, airline IT, distribution and global online travel agencies for Amadeus, adds that “Amadeus is determined to enable all stakeholders to make the most of the potential that NDC can deliver, and bringing one of our largest online travel agency partners onboard is a great illustration of this. Building on our relationships with both airlines and travel sellers, we are in a strong position to foster cross-industry collaboration on NDC to the benefit of travelers everywhere.”
What Lies Ahead?
As the travel industry continues to evolve, NDC is expected to play a crucial role in reshaping how airlines distribute their products and how travelers book their flights. Koch notes that NDC can open the door not only to lower fares but also a broader inventory, which can significantly mitigate the common complaint among travelers about rate discrepancies.
“This advantage alone makes exploring NDC worthwhile,” he adds. “Embrace NDC as an opportunity to streamline and enhance your travel program, reducing frustrations and aligning more closely with modern travel needs. This evolution within the industry promises to resolve many of the challenges we have faced for years, if not decades. This is a transformative time for corporate travel, and embracing these new technologies could finally provide the comprehensive solutions we’ve been seeking.”
While shopping receives a lot of attention during NDC conversations, Sabre says that support for end-to-end workflows – including mid- and back-office integrations and duty of care/corporate policy considerations for corporations – is critical for making NDC compelling to travel sellers so that they can maintain efficient operations.
“As for future developments, NDC is an important part of the industry’s shift toward Offer and Order-based retailing,” the company states. “Transitioning to NDC enhances flexibility. Airlines can showcase distinctive content consistently across channels, not just on their own websites. Travel retailers can also access this kind of content for the first time, thereby opening new cross-sell and upsell opportunities. Corporations can start conversations with suppliers about creating offers that fit their employees’ most common travel patterns and that align with corporate policies.”
