New distribution capability (NDC) has been a much-discussed term among the travel agency community in recent months, as more airlines move toward adopting the new program. And travel advisors are becoming increasingly savvy about identifying the advantages and mastering the challenges of this evolving approach to selling air travel.
As just about everyone in the retail travel industry already knows, NDC is a data exchange format launched by the International Air Transport Association (IATA). The new approach aims to make it easier for airlines to create more relevant offers and avoid the heftier costs of legacy distribution models like EDIFACT.
The program also benefits consumers and travel agencies, according to IATA, by helping advisors to access a wider array of content from the airlines and allowing them to make ancillary sales, all while giving customers a more transparent experience.
“New distribution capability was an inevitable direction when looking at the inefficiencies of the historical distribution landscape, when compared with modern data management protocols in other industries,” said Jason Block, CEO of WorldVia Travel Group. “The primary issue is that there is an apparent rush to drive the implementation of this change by some carriers, regardless of the industry’s readiness to adopt the change. It reveals how some carriers value the agency distribution channel, which, evidently, could be improved.”
Indeed, major changes in business practices can naturally cause concern, as advisors must learn a new process for selling air.
“Among the significant challenges posed by NDC for travel advisors at present is the slow response time and inherent inefficiencies associated with its use,” Block said. “Additionally, advisors face booking challenges, which encompass restrictions on multi-city and multi-airline reservations, certain payment limitations and the risk of data losses when transitioning between systems.”
Still, Block sees long-term advantages to using the new platform, and many advisors are taking steps to stay on top of the new reality. Here are some valuable tips about making the most of NDC, according to several industry insiders.
Recognize the Benefits
Despite the short-term challenges, NDC presents attractive opportunities for the travel industry, according to Block. “Travelers stand to benefit, at least in the short-run, from lower NDC fares, which encourages a broader increase in volume across the larger travel industry,” he said. “From an agency management perspective, an expected reduction of debit memos is a welcomed plus.”
Block said the new system can also help to attract new talent to the retail travel industry. “The advent of modern, user-friendly, point-and-click technology within the NDC framework stands as an allure for the next generation of agents,” he explained. “This new wave of professionals can readily adapt to the industry without the steep learning curve associated with older, more intricate systems. However, this is a double-edged sword for air specialist advisors, as reduced skill requirements are likely to drive down compensation over time.”
Anthony Mavrogiannis, president and CEO of Vai Travel, a TravelSavers agency in Hilton Head Island, S.C., is optimistic about NDC’s ultimate ability to help advisors and their clients. “I’m hopeful that we’ll be able to serve our clients better and do it more efficiently as well,” he said, noting the advantages of advisors having greater access to airline content and products. “Sometimes we have to refer our customers to the airline, and I’d like for us to be able to do it all.”
Rely on Partners
No travel advisor works in a vacuum. There are ways to find help in facing the challenges of NDC, especially for agencies affiliated with a consortium or host agency. In September, for example, Travel Leaders Corporate began making NDC-based booking available to clients for free. The current NDC content is largely from American Airlines, United Airlines and some international carriers, but more will be added, company officials told Travel Weekly.
WorldVia Travel Group is among the companies offering educational programming for travel agencies about NDC. “We are committed to ensuring that our travel advisors are well-versed with the intricacies of NDC,” Block said. “We have conducted training aimed at teaching them how to proficiently book an NDC ticket. Nonetheless, given the protracted booking durations associated with NDC tickets, we’ve strategically decided not to involve all team members in this aspect of booking. Developing thorough training curriculum is an opportunity that air carriers can pursue to demonstrate their support of the agency distribution channel.”
Indeed, some airlines do offer travel advisor training to bring them up to speed about NDC. Steve Hirshan, senior vice president of sales at Avoya Travel in Weston, Fla., says it’s always a good idea to explore what the airlines are offering. “Take advantage of the airline’s sales department’s educational offerings,” he said. “If you’re new to the business, this is a great opportunity to look for a good general travel education platform that will give you a basic understanding of how to sell and book air.”
Monitor Client Reactions
The average traveler has little or no awareness of NDC, to be sure. But it’s still a good idea to keep an eye on client reactions to any changes. “While some clients are interested in pursuing NDC fares, we are finding many clients are taking a more cautious approach when they understand the implications of an NDC booking,” said Block. “For clients opting for an NDC fare, we’ve instituted specialized handling procedures for NDC carrier records in a dedicated queue with dedicated team members. Advisor training and matching advisor skill sets to the booking requirements are of key importance to maintain labor efficiency.”
Know Your Options
Travel advisors can choose to direct their business where it makes the most sense, according to Heidi Nanigian, a Signature Travel advisor at Heidi’s Holidays, affiliated with Travel Concepts in Orange, Calif. “[Some tour operators] are not going to participate in offering any NDC fares,” she noted. “This will encourage travel advisors such as myself to book with tour operators instead of in the GDS or direct, to not have to deal with the complicated restrictions of NDC fares.”
Consider Creating an Air Desk
Having a dedicated air desk can make it easier for agencies with enough staff, so that there’s always someone available who is a specialist in air sales. “The two most likely scenarios where it makes sense for a travel agency to develop an air desk are if the current advisors do not have experience selling air, or if the business has reached the point that the agency’s air volume would justify the expense of having a dedicated air desk function,” said Hirshan.
An alternative is to use a similar service operated by a consortium or host agency. Travel Edge Network, for example, has its own air desk that supports airline transactions that its member advisors book.
Don’t Forget the Fees
It’s up to agency owners and managers to decide about charging fees for booking air. Now, as more advisors are investing more time to get over the learning hump about using NDC, their time is more valuable than ever.
“While each advisor needs to make that decision [about fees] for themselves, it’s important to note that booking an air itinerary requires time, knowledge and expertise, and a travel professional should be compensated for their services,” said Kristina Barrett, relationship director, air, and insurance at Travel Edge Network.
Look at the Big Picture
Even as the industry continues to learn the ins and outs of a new sales structure, Block encourages advisors to look at the long term implications, many of which are positive. “I see a broader, more connected travel distribution ecosystem that encompasses far more diversity of product and enables easier connectivity to modern retailing and marketing platforms,” he said.
“While the present teething pains, characterized by partial system integrations and some operational inefficiencies, might appear daunting, there’s an undeniable silver lining,” Block added. “Embracing NDC could be the catalyst that propels the travel industry into a modern era. This paradigm shift, underpinned by intuitive technology, could beckon a generation of talent well-versed in today’s digital norms, injecting fresh energy and perspectives into our community.”
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