In my last two blogs, I’ve written about the continued relevance of the GDS and the need for our industry to invest in new ways to meet the needs of our customers for richer content and greater choice. But it will take more than individual company investments to change the way we’ve been operating for so many years. Real change will come when all the players in the travel industry engage around a shared view of a new model for global distribution, rather than pursuing sometimes conflicting proprietary goals.
We need a new model because we are entering a new era - one that will be characterized by widespread adoption of innovative, technology-enabled services that will facilitate new ways of aggregating, displaying and transacting travel content. The model I envision is one that unites our travel industry in a way that puts our mutual customer - the traveller - at the centre of everything we do. It will:
- Accommodate a vast array of supplier travel options
- Provide agencies with relevant, tailored opportunities at the point of sale
- Deliver solutions that work across multiple channels - the agency as well as the corporate client desktop - and source content from multiple channels
- Enable individuals and corporations to buy travel the way they want to
- And focus on delivering choice and value to informed travellers.
To make this vision a reality, the industry first needs to create and adhere to some standards so that technology systems and platforms can connect and play well together without creating massive system overhead costs. The focus should be on more choice, not the lowest common denominator. In other words, the industry should not accept standards that only lend themselves to the current, well-established technologies, but instead look to the near-term potential of emerging platforms and capabilities.
Standard initiatives, such as those driven by the Open Travel Alliance, IATA, HEDNA and ACRISS, are essential to help underpin and integrate the future technology platform for which we all have such high expectations.
We also shouldn’t confuse standards with a “one size fits all” approach. The new world of distribution requires standards for communications and where to look for content - but it also needs to have flexibility in work flow as well as screen output and display.
This will require investment. Although there are few players today - particularly in this economic climate - with the resources to invest in technology that is scalable, flexible, robust and supported on a global basis, the GDSs need to do exactly that - invest. We also need to wean ourselves from an approach that focuses on segments first and everything else later. If GDSs want to be technology and service providers to the industry - and I think that’s our future - then we need to start acting that way.
There’s no question that the GDSs need to up their game. But there also needs to be a well-thought through “technology framework” for the travel industry if we are to put the customer at the centre of everything we do.
As part of a new model for distribution, wouldn’t it also make sense for the supplier, GDS and travel agency community to move away from drawing up battle lines with content held as ransom to the lowest bidder? Wouldn’t the GDS-supplier dialogue be more productive if it was more about how to increase the attach rate of additional services to the base fare sold? Can travel agencies afford to invest in GDS-independent point of sale tools, solely so they can periodically shop their segment transition from one GDS to the next? Or would they be better served actually spending the money with the GDS as a technology provider rather than as a transaction processing engine?
I see Travelport today as much more of a travel technology company as well as a transaction processing company. In other words, I don’t really see us as “just a GDS” any more. We are spending much more of our time and money on traveller desktop and workflow automation. We’re also investing in technology to support merchandising, including cross-selling, up-selling and other ways that suppliers want to sell their products and provide the choices demanded by consumers, corporate travel buyers and travel agencies. Our technology is designed to be multi-GDS and multiple-source in terms of where the actual transaction is created.
The challenge for the GDS in the new distribution model I’m proposing is that we have to disrupt the status quo. We have to invest in products that are neutral in terms of where transactions go to be processed. And we have to take a more dynamic approach to content, pricing and technology so that suppliers can sell the way they want to sell and buyers can see and filter all the available options.
There is real potential here for the three sides of the distribution triangle to come together to set standards in an environment where we all feel safe investing with a renewed focus on giving our customers informed travel choice. It requires a radically different approach, but there’s never been a better time to do it.
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