We may still be a very long way from the death of the PNR, but all signs are pointing towards its days being numbered. Will travel agencies be ready when that last day arrives? Read on to learn more about what the industry transition to a retail-driven future will mean for travel agencies. Spoiler alert: it could actually be very good news.
So far in this blog series, we’ve examined the wide range of benefits that a retail model will deliver for travelers and airlines, explored the core building blocks of such a solution for airlines and revealed what lies ahead for fare filing and booking classes. In this blog, we widen the focus and turn our attention to another key part of the travel ecosystem – travel sellers. We’ll look at the challenges agencies currently face and what the path to a retail-centric future state built around offers and orders could look like.
It is a commonly held belief that the travel industry today is primed for transformation. Limited differentiation in the marketplace has led to travel becoming increasingly commoditized in the eyes of travelers. Consumers are now seeking out more personalized travel experiences that meet their exact requirements, and an opportunity is emerging: Sabre believes that agencies are uniquely placed to take advantage of this current state of flux and capitalize on the accelerating shift in consumer demand. The road ahead may be long, and necessitate changes to current ways of working, but the long-term rewards could be well worth the journey.
For more than 150 years, agencies have provided the link between travelers and travel experiences. At present, the process of shopping, booking and managing travel does not allow for a seamless experience, particularly with business travel. This is precisely where an agency can add real value by navigating the travel supplier labyrinth on behalf of travelers; sourcing the right choices that optimize traveler-defined value; and lending a hand when servicing and support issues arise.
However, agencies are hamstrung in this endeavor by an industry mired in complex processes and legacy infrastructure. Travel agencies are endlessly resourceful and have adapted to evolving situations well through the years, but many core systems and processes were developed decades ago to meet the comparatively simple needs of an analog world – certainly by modern standards.
Aren’t agencies already plugged in to offer and order-based retailing through NDC? How is that going?
Yes, some agencies are already shopping and booking NDC offers and orders. Currently, over 3,000 Sabre-connected agency offices in 49 countries have activated NDC capabilities through Sabre. This progress is encouraging, but it remains early days in terms of adoption. Some of the dynamics affecting agency adoption of NDC include:
- Limited content differentiation: some agencies are waiting on the NDC sidelines until they see more live examples of innovative content from airlines.
- Rollout of airline-initiated surcharges: some airlines are using NDC as a means to introduce surcharges on ATPCO/EDIFACT content that agencies book through non-NDC connections.
- Foundational capabilities in work: operational efficiency is key for agencies, therefore agencies would like to see more foundational capabilities available before hitting the NDC accelerator.
- IATA NDC standards continue to mature. The NDC standards remain a work in progress and important use cases, such as interline, are not yet defined by the IATA working groups.
Agencies can expect to operate in a world of hybrid content – i.e., processing both traditional ATPCO/EDIFACT and NDC content – for years to come, requiring new workflows and legacy processes to run in parallel. As a result, some of the efficiencies of offers and orders are being deferred in the short-term.
“Sabre is deploying NDC capabilities that are ready to scale from day one for our customers. As airlines create more innovative offers, we are ready to provide agencies and corporations with efficient access to that content. We are also committed to minimizing disruption for travel retailers as they embark on the transformation journey and adapt to new ways of working”.
Vice President, Channel Delivery
Sabre Travel Solutions
Moving beyond legacy constructs such as the PNR to a retail-driven model underpinned by Sabre’s NDC-enabled offers and orders opens a world of opportunity for travel agencies. The proposed future state should see agencies better able to meet the needs of travelers while reducing costs and increasing profitability.
“Agencies should approach the transition to a retail-centric future with an open mind and a long-term outlook. Established and familiar ways of working will, in time, yield to new and improved alternatives. Obstacles faced today, such as content fragmentation, will be overcome with consolidated multi-source solutions. Ultimately, agencies will be able to more easily compare offers and advise customers, all while benefiting from seamless back-office processes.”
Senior Vice President, Indirect Channel
Sabre Travel Solutions
The IATA vision foresees an end-state in which agencies will be better equipped to offer customers the right choice of tailored products and services, effectively and with improved profit margins. Modern, streamlined processes and increased automation will result in efficiencies that reduce operating costs. Resources will be freed up to focus on core business activities that add value, rather than labor-intensive manual processes that don’t
For travelers, the overall experience should feel more personal and engaging, more closely aligned with what they have come to expect from retailers and service providers in other areas of their lives. They will benefit from travel experiences centered around meeting or exceeding their expectations, and that deliver better value per travel dollar spent than ever before.
Industry transformation is coming, and soon. The changes outlined in this blog are far-reaching and will impact many of the fundamental ways that agencies work today. The status quo may be sustainable in the very short term, but beyond that the existing ways of working will need to evolve. Now is the time to start planning for that future. But agencies aren’t in this alone – Sabre will be there to provide the advice and support travel agencies need to ensure a successful transition. We will cross the uncharted waters together, in partnership, navigating through the unknown to emerge better and stronger on the other side.
Interested in learning more? From educational resources to industry insights, we’ve got you covered at Sabre.com/open.