Why we can’t ignore NDC any longer
Above: A chat about NDC, blockchain and the future of travel booking between Innfinity CEO Beverly McCabe and Executive Director of the Association of Corporate Travel Executives (ACTE) Greeley Koch at the ACTE Toronto Conference from November 21, 2017.
A breakdown of the New Distribution Capability (NDC) and why the business travel community ought to start caring
The New Distribution Capability (NDC) has begun to gain some traction with travel buyers and TMC’s alike, and I think it’s time we talk a bit more about exactly what NDC is. Though we’re far from seeing the full impact that NDC will have on business travel buying at this point, it’s definitely worth getting better acquainted with the technology and understanding what it will offer travel buyers moving forward.
So, for those that are a little fuzzy…
What the heck is the New Distribution Capability (NDC)?
The International Air Transportation Association (IATA) launched NDC to “transform the way air products are retailed [by airlines]to corporations, leisure and business travelers, by addressing the industry’s current distribution limitations: product differentiation and time-to-market, access to full and rich air content and finally, a transparent shopping experience."
On a more technical note, NDC provides a standardized messaging format that enables airlines to modernize the way they retail fares and offer special client-specific bundles and deals via a direct integration between booking channels and their API’s.
And why have we, as a corporate booking tool, taken such an interest in NDC?
The answer is simple: We feel writing direct connect integrations is a natural extension of what we’ve been doing all along. For those that don’t know, we got our start in the Energy, Resource & Marine sectors many years ago, booking and managing charter planes, buses, boats, helicopters, and various other charters of the like. We then broke into commercial travel, adding Sabre content and Air Canada content simultaneously into our tool. (The integration of these two commercial air content channels into our technology stack gave life to what is today the Innfinite online booking tool.)
By embracing NDC technology, we’re able to continue aggregating additional content channels for the benefit of our clients. NDC helps us to do so more easily by standardizing the way airlines feed fares, deals and bundles into corporate booking tools like ours, ensuring content is delivered in a uniform way to booking tools. Creating uniformity for the way content is fed into the booking tools facilitates and expedites the writing of these integrations for our developers. This is because we now have the comfort of knowing that every time we’re approached by an airline to spin up a direct connect, our developers won't be forced to write an integration that looks completely different from the last one they wrote.
Content is King
By writing NDC-compliant direct connect integrations, we can offer our clients richer content. This ultimately means greater purchasing choices—if our clients want them. And at the end of the day, we’re looking to offer that flexibility.
So… what specifically does richer content mean for travel buyers?
And... for the rest of world that gets less excited about standardized messaging formats and more fired up about free lounge access or complimentary in-flight wifi, we'll focus on two words here to illustrate the value of NDC:
Favors & waivers
With an NDC interface, a corporate booking tool can give airlines the option to offer their valued corporate clients fares that are automatically bundled with favors (a.k.a. perks). Favors might look like…
- Free lounge access to all business travelers
- Multiple free checked bags for travelers booked on any fare class
- Complementary boarding for all travelers flying Business
- + any number of other favors the airlines might decide to offer their corporate clients.
Waivers are any sort of fees that airlines might choose to waive for their valued corporate clients. These might take the form of:
- Free exchanges
- Waived cancellation fees
- Waived copay for flight upgrades
- + a variety of other waived fees, depending upon what the airline decides to offer.
The examples listed above are just that, examples. Special bundled perks and waived fees offered via NDC-compliant direct connects will be agreements negotiated between companies and their supplier airlines. Each corporate client will see only the fares/bundles/waivers they have negotiated with their preferred air suppliers within the booking tool.
A note about NDC Negotiated Fares:
NDC negotiated fares will fit in right alongside private fare, marines fares and all other additional content we're already able display to our clients within the tool.
Where we fit in as the booking tool:
Just to be clear: We, as the corporate booking tool, merely serve as the conduit to deliver these prices & offerings on behalf of airlines to their corporate clients.
We think it’s a win-win-win
NDC is a win for airlines because it allows for broader customer reach beyond what the airline is able to offer corporate clients via their own company website (supplier.com) or via existing corporate booking tools.
NDC gives TMC’s greater opportunity to more fully service their clients by offering them access to these special airlines bundles and waivers, and richer content in general.
For Travel Buyers
As far as purchasing is concerned, NDC gives travel buyers the ability to ask for special NDC negotiated fares, bundled perks and fee waivers. Up until now, this type of conversation would not have been possible, because airlines had no way to deliver these special deals via a corporate booking tool.
Travel buyers' ability to get the most out of these negotiations will of course depend upon the negotiating power they have when it comes time to sit down annually with their preferred air suppliers.
Some additional value-adds for travel buyers:
- Greater visibility: By letting travelers know they’ll receive special deals by booking with the authorized booking tool, travel managers can incentivize travelers to book on the tool, which in turn reduces leakage and improves compliance for their companies.
- Maintain integrity of Duty of Care: By reducing leakage and improving travel program compliance among their business travelers, travel managers are better able to maintain the integrity of their Duty of Care. This is always top priority for companies with tightly managed travel programs.
And with that... here's to a productive rest our work weeks! I hope I've shed some light on what NDC is and why we should all be kept up on this exciting technology as it gradually shapes the future of business travel buying.
Post authored by:
CEO of Innfinity, Beverly McCabe is a 25-year veteran of the lodging and travel industry.