The NDC explained: what it really means for the corporate traveller?

Travel News 25 Jun 2018

The global buzz around the NDC (New Distribution Capability) is getting louder by the day, as corporate travel buyers increasingly agree that the NDC is ‘a positive thing’ for the travel industry. New research from Business Travel Show reveals that one in five buyers (18%) believes the NDC offers more transparency with pricing.

Although a lot of noise has been made around how this new set of rules by the International Air Transport Association (IATA) will ‘facilitate’ communication between travel agents and airlines, why should the corporate traveller care about this?

The short answer is: because it will offer you quite a few benefits.

1. Offers tailored to your preferences

With NDC, travellers can choose to save their information to their profile.

It’s not mandatory to save your details to your profile, however, by saving your information, you can have the benefit of easily customising your search results.

For example, Wi-Fi on the plane could be included in your company’s corporate agreement with the airline, while for the leisure traveller, Wi-Fi will cost an additional R150 on the same flight. The different pricing results will immediately be reflected on the NDC results, giving you a more accurate overview of what you can expect to pay.

Thanks to the NDC, airlines will also be able to access any personal information you are willing to share to construct an offer tailored specifcally to you. Take for example Lufthansa, they could send you an offer for a Bavarian brewery tour if you have a long stopover in Munich.

2. A faster service from your travel agent

For the travel agent, the new communication standard means they can pay for a preferred seat, add additional baggage or re-order catering through any Global Distribution System (GDS) they are using instead of having to book this on the airline’s website.

Right now, if you want to book pre-boarding or pre-pay for your luggage with FCM, the consultant has to leave the GDS. With NDC, we are able to shop for all these services in a single transaction in one place.

For your travellers this means we can offer you a lot more options in a more efficient way, whether you would like extra legroom, extra baggage fees, comfort class upgrades or special meals.

3. A visual representation of what to expect from your travels

Hesitating if that extra leg room is worth the splurge?

Since NDC is based on a high-quality XML standard, both travellers and travel agents will have access to a rich content experience with pictures and videos. That means that you can see exactly how much extra space you are actually buying.  It also makes it easier for you to compare several items (and airlines) at once.

For travel agents, the visual representation means it becomes easier to communicate with you about product differentiation beyond price and schedule.

4. The ability to comparing apples with apples

It can sometimes be hard to understand exactly why your FCM consultant advises you to pay more for a flight that leaves at about the same time and follows the same itinerary.

Why would you fly Air France instead of British Airways for example if you’re headed to Brussels? One will take you via Paris, the other via London, but other than that: what’s the difference?

Thanks to the NDC, we can show you what the seats on your chosen airline look like, and help you compare what you can expect from the lounge and what mileage you earn on each airline.

5. An easier way to book low cost carriers

The rise of low-cost carriers, which were traditionally outside the GDS, have seen travel bookers lose visibility and control of a growing proportion of their air spend. The NDC could help in this regard.

IATA explains that for low-cost carriers with no GDS presence, NDC will enable such a carrier – which today only sells direct to the customer – to sell via your FCM travel manager.

If it’s that great, why is not everyone jumping on the NDC bandwagon?

Firstly, the NDC implementation doesn’t come cheap. The technology is expensive and it’s not a mandatory requirement for any airline or travel agency.

The NDC is not a uniform technology either, and can look different from one organisation to the next. There are different versions of NDC as well as different levels.

How about the surcharges airlines have started charging?

A number of airlines have started charging fees for bookings made in the GDS, instead of through their own channel or through the NDC. Among these are Lufthansa, British Airways, Iberia Airlines, and Air France - KLM .

The Flight Centre Travel Group has signed multi-year distribution deals with most of these airlines to eliminate the booking surcharge. This means that FCM Travel Solutions’ clients will be exempt from the surcharge.

Further good news is that the three main global distribution systems: Amadeus, Travelport and Sabre, have all decided to get on-board with NDC capability.

The reality is that the NDC could have profound effects on how air travel is booked and marketed to travellers in the next few years. Exciting times are ahead…