FCM experts weigh in on the state of NDC
New Distribution Capability (NDC) is not a new concept for most corporate travel professionals – it’s been a burning topic for a while now. However, the urgency surrounding NDC has only intensified since the start of 2023, spurred on by the rapid onset of airlines implementing NDC fares and buyers wondering what’s next and how to keep up. All this being said, it only makes sense that NDC would be the dominant conversation topic at industry events, including GBTA Dallas 2023.
For those who weren't at GBTA Convention to catch panel discussions surrounding NDC, we're expanding the conversation here with more analysis and rumination on the implications of NDC. Two of our FCM experts divulge on the topic.
Meet the experts
Disruption is key to innovation…with caveats
To say NDC is disrupting the airline ticketing status quo is an understatement. And historically, the greatest leaps are made when embracing disruption and tackling change head on. Peter reflected on the need to make sure any forward momentum is ready for the long term, and not a “flash-in-the-pan” response.
“Everyone’s clamoring for a piece of the same pie, even as some suppliers are aggressively pushing their agendas on the end-to-end distribution network,” Peter said. “The content also needs to be productive in how it's serviced end-to-end before protocols like new distribution capability (NDC) finally achieve critical mass. While disruption is key to innovation, it's important not to force-feed change before the full supply chain is ready to ensure sustainable progress.”
Florian also showed caution around the phrase “NDC ready.” To various TMCs and airlines, it could mean something totally different. To Florian, it means certain benchmarks need to be met beyond NDC fares just being accessible in the OBT.
“[NDC ready] means to be live with NDC content for both shopping and servicing and meeting minimal viable product,” said Florian. “It doesn’t need to be the perfect solution, but it can’t just be shopping either. That’s a bit too easy.”
But NDC fares being accessible in a buyer’s OBT of choice is a whole other ball game, and one that comes with its own set of rules and concerns. “Without naming names, some are doing better than others,” Peter reflected. “Each OBT’s solutions for NDC is slightly different; NDC was designed as an industry standard, however each OBT has interpreted this slightly differently in how to develop their tools and thus deliver at scale. OBTs that have focused on user experience, modern airline storefronts, and self-servicing of NDC content are leading the way.”
For Florian, there also needs to be an element of managing expectations when it comes to the NDC readiness of the industry. Change is difficult, and it will require flexibility from all sides to rise to the occasion. “There is a lot of fragmentation right now, and that will continue for another 12 months until solutions are broadly available for the top airlines in relevant markets,” said Florian. “Since online adoption is well above 50%, the first step will be OBT readiness together with serviceability. Shifting all online transactions to offline channels will likely not be realistic due to scalability and resourcing. And to be frank, more than 85% of the world’s airlines have not announced an NDC program, so the key is not just about NDC but also about managing both NDC and EDIFACT standard.”
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Crucial next steps…and questions
Between all the back-and-forth of what NDC means, how it’s going to change air sourcing, and the impact on the traveller experience, there’s just one single question buyers keep asking: What do we do now?
Florian said the key first step is to get everyone on the same page. “Prioritize your key airline partners and get the experts from each party in the same room so all stakeholders can talk among each other. Then ask about each stakeholder’s roadmaps and identify the gaps for your program. Ask your partners for possible solutions and then develop a mitigation plan for your program which should include internal communication.” And Florian knows something about coordinating with stakeholders to implement NDC: He spoke on the GBTA Dallas panel “Taking NDC from Theory into Practice,” which detailed how FCM, United Airlines, SAP Concur, and our client, Bechtel, worked together to access NDC fares. “[The session showed] it can be done, but there are challenges to overcome. Attendees appreciated the time and effort invested by the members of this pilot, as it helped paved the way for other programs to remove roadblocks and learn how they can access NDC fares, even with less resources.”
Peter noted that the way TMCs’ travel platforms can solve for the NDC conundrum is by accessing maximum content. “By getting maximum content into as many booking channels as possible (regardless of the EDIFACT vs. NDC protocol), providing the ability to make NDC/EDIFACT cross-exchanges, successfully reporting on NDC bookings, and ensuring users can enjoy NDC’s benefits of purchasing ancillaries like baggage, meals, and seats during the booking experience, TMC technology can ensure buyers are getting the most out of NDC.”
Discover the alternative…in NDC
Obviously no two TMCs, airlines, or OBTs are approaching NDC the same. So to round out our interview, we asked Peter and Florian one more question: How is FCM approaching NDC differently?
“Investment, innovation, and expertise,” said Florian. “We embrace NDC, believe in its capabilities, and have been live with NDC for years in multiple countries. We have the highest level of IATA certification and are involved in industry boards and councils. With our parent company’s majority ownership of TPConnects, a market-leading content aggregator, we have a unique setup that allows us to plug into multiple sources of content (GDS, airline direct connect, and low-cost carrier) enabling us to shop and service the most relevant content for our clients.”
“FCM is working with its clients to help them understand the technical and commercial implications of NDC so that they can make informed decisions around when, how, and where to make this content available to their users,” Peter said. “For example, does it make sense to enable certain content if it has technical limitations on modifying, canceling, or refunding these bookings? That’s where FCM’s expertise comes into play. Further, our investment in TPConnects futureproofs our roadmap as NDC content provider.”
Take the next NDC step
NDC is the future, but it needs to be approached thoughtfully. It’s critical to build a team with all your necessary stakeholders, and remember to not sacrifice functionality for the sake of innovation.
If you’re looking for your NDC-ready partner, look no further than FCM. We have the right team, tech, and knowledge to start implementing NDC into your travel program. Learn more about FCM’s NDC journey and mission HERE.
If you’re ready to transform your program, reach out to us today.