Uncertainty among travel managers in light of the new NDC model

With a landscape in which airlines are changing the way they market their products and services, the so-called New Distribution Capability (NDC) opens up new possibilities, but also poses challenges and challenges for corporate travel programs. This is highlighted by research conducted by ACTE Global, developed in collaboration with American Express Global Business Travel (GBT).

The study, entitled "The Evolution of Air Distribution," explores travel manager experiences and attitudes toward changes in the airfare distribution model;It explores the experiences of travel manager attitudes toward changes in the airfare distribution model, including the NDC model, a technology developed to standardize distribution through an API (Application Programming Interface) protocol.

According to the survey, travel managers expect the NDC to bring benefits, with 64% of respondents believing it will improve the booking experience, while 56% believe it could help contract negotiations with airlines. 

However, most travel managers fear that the fragmentation created by NDC could threaten cost control (89%), the compliance policy (87%) and the objectives of ‘duty of care’ (77%).

Fragmentation is already a reality due to the purchase of ancillary services offered by the airline. Nearly half of survey participants (49%) say their travelers purchase ancillary services that are outside their travel policy through airline websites.

The flight from the online booking tools used by airlines to other channels is a direct consequence of the fragmentation of airline fares based on baggage payment or baggage selection;This has made the traveler's booking experience more complex and made it difficult for the travel manager to have full visibility of the airline's spend.NDC is a response to market demands and enhances the traveler experience through personalization. But it also comes at a price for the travel manager, who is trying to figure out how to maintain control of his or her programs if NDC becomes the norm," says Greeley Koch, executive director of ACTE Global. 

Although there has been much debate in the industry about NDC since IATA introduced the concept, the uncertainty about what exactly it is and what implications it will bring continues to linger. 

Nearly a quarter of participants (23%) feel they do not have sufficient knowledge about NDC and the impact it will have on their travel programs, while more than 58% believe they have “some knowledge” about the topic.

As a result, few travel managers consider themselves fully prepared to incorporate tools adapted to the new distribution system into their programs, with 63% saying they are not currently exploring new platforms beyond their current online booking tools.

According to the study, travel managers fear that NDC could

transgress key pillars of their travel programss. The main concerns in this regard include reduced functionality of the companies' online booking tool; increased costs as a result of fragmentation of products and services; lack of data availability or lack of transparency on fares (88%).

“With the advent of NDC, the big question is whether travel managers will be able to maintain visibility into costs and traveler behavior, but they can't afford to wait to manage change, says Koch.

 

 

With the advent of NDC, the big question is whether travel managers will be able to maintain visibility into costs and traveler behavior, says Koch.