It's no secret to those in the travel and aviation industries that IATA’s New Distribution Capability (NDC) has faced a difficult road to adoption. Established to create an industry standard for airlines to directly sell their flights and ancillaries to travel sellers, NDC set out to enable carriers to differentiate themselves from their competitors and get to know their customers through personalised offers. By providing direct inventory access to third-party providers, airlines hoped to create transparent competition and lower the price of distribution, bypassing costly legacy systems.
However, in the six years since its implementation, NDC has faced a series of challenges and travel sellers still show a lack of confidence and uncertainty about using the standard. This won’t do. At DRCT, we believe airlines should work to strengthen their ties with Online Travel Agencies (OTAs), Travel Management Companies (TMCs) and smaller agencies.
"We’re calling on carriers to take action, making access to NDC content easier without additional expenses for sellers"
That’s why we’re calling on carriers to take action, making access to NDC content easier without additional expenses for sellers. For too long, smaller travel agencies and travel management companies have found the integration of NDC into their sales costly and complicated. This neglects a significant part of the market, who could enhance an airline’s fare distribution strategy and make it actually work. In addition, there is still fundamental friction between NDC and GDS platforms, which is why we believe airlines should cancel the incentives received via GDS, so sellers will not be willing to use the outdated technology.
Recently, we issued a call to action for airlines, offering advice on the five steps they could take to enhance their NDC sales:
Step 1: Prioritise developers. By providing sandbox environments and efficient support for developers, airlines can tackle issues with current products and learn from feedback.
Step 2: Make API documentation and the flow of the certification process public, so aggregators can quickly start providing sellers with needed NDC content. This takes into consideration smaller sellers who may not have the finances to invest in multiple airline NDC implementations but can afford to work with NDC aggregators.
Step 3: Switch on NDC for as many TMCs and OTAs as possible by making contract signings non-binding and the generation of credentials automatic, ensuring content can be sold without barriers.
Step 4: Offer incentives so the costs to distribute NDC content are not passed back to travel sellers. Step 5: Provide exclusive fares and ancillaries via NDC, giving those sellers a financial advantage to cover the costs of changing business processes and show the value of changing to newer ways of retailing.
Distribution is one of most expensive parts of the price of an airline ticket, largely because airlines still use the same outdated technology and distribution systems in place since the 1980s. Every year, one billion airline seats remain unsold, and improvements are needed in the online experience for passengers.
It’s time to remove the barriers NDC has faced since the standard was launched. We believe that airlines, OTAs and TMCs need to launch a dialogue now so these sellers are not left behind. * Dmitry Ianishevskyi is the director and co-founder of DRCT, a travel technology provider and IATA-certified NDC aggregator.