As you know, I was in Dublin last week for the CAPA Airlines in Transition conference. But it was Travelport that brought me out to the conference (paid for flights and hotel) because they rolled out their new Merchandising Platform the night before. What the heck is a merchandising platform and why should you care? Well, the most immediate benefit is the ability to compare and then book easyJet and legacy airlines side by side. But this is just the beginning.
Last month, I wrote my series about why airline distribution takes so long to change. At the time, I mentioned that American had signed a deal with the Global Distribution System (GDS) Travelport that would allow it to sell tickets the way it does on its website. This deal would allow travel agents and potentially consumers to buy fare bundles in an intuitive way, add baggage, choose preferred seats, and more. It would also allow American to give pricing based on elite status, if you provided your frequent flier number. (It would know you had a free bag, for example.)
But that was just an announcement and nothing had been put into practice. And while it still isn’t in practice with American yet, we now have a real live example of how this can work with easyJet.
Above you’ll find a screenshot of a graphical travel agent desktop. It may not look like much, but the fact that you can now see easyJet side by side with other airlines is a big deal. In fact, it’s a big deal for a few different reasons.
easyJet Can Be Compared
First of all, agents can now readily see how easyJet compares without having to go outside the GDS into a separate system. That in itself is a big victory for people who want to look at all options. And why would easyJet want that? Because it wants a piece of the higher dollar corporate bookings that are going to come through these systems. It now has a much better chance of selling to business travelers.
easyJet is in a GDS
You might not think this is a big deal, but a lot of low cost carriers don’t use systems that can readily interface with GDSes. They may have non-traditional ways to do it, like through an API, but GDSes haven’t really worked that way when it comes to selling tickets. When Travelport made a decision to start working with non-traditional methods, it opened up opportunities for airlines like easyJet to get in the GDS without having to make a significant IT investment.
easyJet can Sell Ancillaries
One of the big reasons that easyJet is in the GDS is that Travelport has decided to let airlines sell ancillaries and has inserted this into the selling process directly. In the shopping screen, you can see multiple fares types. In easyJet’s case, it’s both regular and flexi fares. You can also buy a bag on easyJet, or you can pay for a seat assignment, priority boarding, etc. Of course it’s not just easyJet here. Other airlines do it as well. For those who are familiar with a travel agent “green screen” (the text-based, old-school method for selling tickets), this is how it looks with Alitalia’s ancillary options:
This isn’t what a regular consumer would see, but to a travel agent, this is a beautiful sight. The ability to sell everything in one place will make life so much easier.
easyJet Can Do This in a Cost Effective Way
Admittedly, I don’t know if this is true. Nobody will ever talk about commercial agreements unless they have to in court. But I can’t imagine a scenario where easyJet gets hit with some insanely high booking fee and still decides to go forward with this. Sure, I can imagine that with the legacy carriers here. They’re already in the system, so they really want to try to sell ancillary services. But for easyJet, it had to be a compelling business model or the airline wouldn’t have considered it. Right? (If not, then I fear for the airline’s survival.)
But this goes beyond even just being allowed to sell ancillary services. This platform will also allow airlines to include all kinds of information in the booking process that will help agents to sell those ancillary services. Here’s a mockup of what’s to come:
Even from a green screen, you can easily find what is included in a fare bundle. Or if you see a seat map, you can see exactly what the seat looks like. Basically, Travelport has created a big database that can be maintained by the airlines with branding and product detail. Considering that most airlines sell the bulk of their tickets (outside of direct sales) via a couple of GDSes, it would be in the airlines interest to keep these up to date.
In the end, the way Travelport spins this is that the company will work with any airline in any way that airline wants. Does one airline want to keep connecting in the legacy format used by many airlines today? No problem. Does another airline want to use an API? Fine. Does an airline want to do a hybrid of the two depending upon what’s being sold? Go for it. Travelport is going to become an aggregator of all these options.
But will this translate into the customer experience outside of travel agents? It could. After all, Travelport powers Orbitz, among others. So if the information is in Travelport’s system, it makes it easier for Orbitz to sell. This doesn’t mean, however, that you’ll find easyJet flights on Orbitz today. Just because it’s technically possible doesn’t mean that the airline wants to do it. After all, easyJet isn’t going to find many of those high-dollar corporate travelers on Orbitz. But that doesn’t mean other airlines won’t jump at the chance to participate, if the price is right.
Now we just have to hope that Travelport is willing to make the price right for airlines to participate in any form. I would think easyJet got a great deal. As a successful airline not using the GDS today, it has more leverage than a legacy airline that relies on GDS bookings. And of course, American’s agreement came with the end of litigation between the two companies. But what will be see with other airlines? With any luck, we’ll see widespread adoption.
If we do, it sounds like airlines can get up and running quickly. I was told that if an airline is actively engaged in the process, it can be online within 3 months. But when I said, “Great, so I can expect to see American up by July?,” I didn’t exactly get a response.
Assuming airlines really do start participating, Travelport is about to get a lot more useful.
Doesn’t Travelport own Sabre? If so, wouldn’t that be some sort of conflict?
How does this compare to efforts by FareLogix and Amadeus to inclulde ancillaries?
Sabre was started by AA but is now an independent GDS. Travelport is an amalgamation of earlier GDS’s including Worldspan which can trace its roots to Delta and Galileo which can trace its roots to United, but is now also an independent GDS. So Travelport and Sabre are independent competitors along with Amadeus.
Bravenav explained it well. Today, Sabre and Travelport are the two biggest GDSes in the US by far. So they are competitors and are unrelated.
Amadeus is a competitor to both Sabre and Travelport and they are a distant third place in the US market. Any efforts they make would likely benefit their travel agent community.
As for Farelogix, it works quite nicely, actually. Farelogix works with airlines to create APIs. They aren’t trying to create an aggregator on their own. So in this case, American hires Farelogix to create the API. And then Travelport can take the API and integrate it into its system.
I could see a system where you could compare side-by-side different airlines with everything you would want. Start off searcy by clickinig from a menu that you want advance seat assignments, food purchase, checking X number of bags/bikes/golf clubs/etc and then see side-by-side the total fare which would include what other options you want. That is the only true way to judge who is really cheaper. A fare alone doesn’t do that when you have to start paying the extras.
David – Yeah, I talked to the Travelport guys about that kind of system, and they said that it’s not part of this product but they know that’s where people want it to go. It will take work to get to that point, but it sounds like it’s on the roadmap, at least.
David, it’s also a matter of building one block at a time and delivering and testing that. Software development focuses on smaller deliverable pieces instead of one huge mammoth release that does everything.
better for who?
stan – Better for pretty much everybody.