As air travel buying becomes more complicated, NDC offers solutions as well as complications of its own
While the proof of NDC’s potential still remains to play out in the marketplace, some intriguing research offers both compelling impetus for the standard’s continued development, and some cautionary counsel.
NDC Is Here to StayIn 2018 major US airlines alone generated $26.9 billion in ancillary revenue, according to travel and expense solutions provider Serko. Given the scope of that spend, the control and visibility that NDC brings means the standard is destined to be more widely implemented in the future.
According to IATA, some 178 companies including 73 airlines, Amadeus, Sabre and Travelport, plus 20 other aggregators, travel IT providers and travel management companies have now successfully taken part in the NDC certification program and are capable of sending and receiving NDC messages.
Personalization is KeyIn Travelport’s Global Digital Traveler Research 2019, which surveyed 23,000 people from 20 countries, 42 percent of survey respondents reported the desire when booking a flight to personalize their own experience through add-ons such as added baggage allowance, meal upgrades and extra legroom. NDC provides a more transparent shopping experience for both corporate travel buyers and individual travelers.
The Transparency Solution?At the same time, over half of travelers in the same survey (52 percent) noted frustration in not being able to understand what is included as part of the bundled fare (52 percent) and not knowing what add-ons are available to them (56 percent). Potentially, such frustrations can be reduced or eliminated through NDC options for viewing and comparing air fare options.
Positive ImpactWhile NDC goes back to 2012 when the standard was first introduced by IATA, wide-scale acceptance has been slow to evolve. Concerns remain in areas such as cost control, policy compliance, duty of care and management of flight disruptions. By 2018, however, a clear majority of travel manager (64 percent) surveyed in a poll by the Association of Corporate Travel Executives said NDC will have a positive impact on the traveler booking experience.
Travel management companies too are positive on the opportunities offered by the NDC adoption, with a vast majority saying it offers access to a broader range of airline content and greater ability to negotiate airfares or traveler perks or benefits.
But Uncertainty PersistsOn the other hand, a significant number of global travel managers remain skeptical: 90 percent fear lower functionality; 89 percent believe unbundling could mean higher costs; 88 percent worry about less fare transparency, 87 percent about compliance; and 77 percent are concerned about duty of care.
TMCs also expressed concerns about risks posed by NDC adoption, such as airline content access challenges and/or content fragmentation, or facing technology disruption or new expenses for TMC systems.