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The travel industry has seen steady progress in the adoption of New Distribution Capability (NDC) in the last few years. The recent pandemic drove the need for personalisation and simplified process in air shopping.
Travel Daily Media has spoken with Mark Sheppard, senior director, NDC product leader, Sabre about progress of NDC in APAC and its role in rebuilding travel. Mark has been with Sabre for almost 25 years and wore different hats. Currently, he is a product management leader for Sabre’s NDC program.
Travel Daily (TD): In layman’s terms, can you give a short description of Sabre’s New Distribution Capability (NDC) and its importance in air shopping?
Mark Sheppard (MS): The International Air Transport Association (IATA) created New Distribution Capability (NDC) to enhance how airlines and travel sellers communicate to sell and manage travel. NDC is an XML-based messaging standard that helps airlines broaden their distribution reach by enabling third parties to access and sell airlines’ dynamic offers, ancillaries, and rich content.
“NDC is not a destination, but rather a stepping-stone to realizing a broader vision.”
At Sabre, we call our program, Beyond NDC, to indicate that NDC is not a destination, but rather a stepping-stone to realizing a broader vision. It is about thinking bigger, beyond what the technical standards enable. It is ensuring NDC helps to usher in offer and order-based airline retailing by making new types of smart travel options more widely available and easier to manage through the Sabre marketplace. We are focused on delivering NDC capabilities that not only look good on paper, but also perform well in practice. Working with companies across the travel landscape allows us to collect feedback from varying perspectives. We use that feedback to build scalable solutions – in partnership with Google Cloud – that benefit the travel industry overall, not just one particular group.
TD: What role does NDC play in rebuilding travel?
MS: For travel demand to continue its recovery, the industry needs to concentrate on understanding and supporting the current needs of travellers—be they leisure or business, solo adventurers or groups. The challenges of the past few years have focused travellers’ attention on value and flexibility. They are willing to spend money if they see value delivered on their terms. At the same time, they also want to know there’s flexibility in the system to help them respond to changes without getting completely derailed.
NDC contributes to building a travel infrastructure for the future that addresses these needs. NDC expands access to new types of offers. It also accelerates the speed with which airlines can get those offers to market. As a result, NDC creates more opportunities to deliver more options that align with varied definitions of value. In turn, these new travel options create new opportunities for agencies to realize value, as well. Over time, a world of offer and order-based airline retailing will streamline servicing and trip management. Multiple records and identification codes will be consolidated into a single order. Agencies will be able to help travellers keep their trip components coordinated when plans change. They will also begin to realize operational efficiencies related to streamlined settlement and simplified administrative processes. NDC is the doorway through which agencies can work with airlines to access these new capabilities.
TD: What is the progress on NDC in the APAC region (e.g. in terms of implementation and adoption?)
MS: The APAC region has always been at the forefront of NDC innovation. We have made great progress bringing NDC to life in APAC, and around the world. Thousands of travel agencies are shopping, booking, and servicing NDC content from leading airlines in the Asia-Pacific region and beyond. These include carriers that are based in APAC, or fly in the region, including Singapore Airlines, Qantas and Qatar Airways. Our development pipeline includes more than 30 airlines. Stay tuned for more airline announcements with links to APAC throughout 2023.
TD: How does your partnership with key airlines like Qantas and Singapore Airlines help in encouraging the adoption of NDC? How do airlines grow their top and bottom lines with NDC?
MS: Airlines want more control over the what, where, how and when of travel retailing. NDC expands airlines’ distribution reach, which means that third parties can access new types of offers that include not only airfares, but also ancillaries. Longer term, offer and order-based travel retailing will make it easier for airlines to partner with other suppliers to introduce yet more variety. These offers can include rich content, which helps airlines stand out from competitors. By expanding access to different combinations of existing content, as well as new types of content, airlines unlock new opportunities to create value.
Close collaboration with innovative airlines, such as Singapore Airlines and Qantas, has been vitally important to our ability to make progress on NDC. We apply a flexible engagement framework to airline collaborations. This framework includes opportunities to collect and incorporate feedback from travel agencies. Since we work with many different types of travel companies, we are able to aggregate feedback and help airlines better understand what capabilities are needed to encourage adoption along the value chain. For example, we have provided suggestions to airlines about how to optimize their technology so that offers can be displayed faster. These changes reduced agency automation time-outs and reduced the risk of shopping cart abandonment. We also help airlines think through delivery sequencing so that capabilities that agencies value highly receive appropriate attention. By bringing these different parties to the table, we are able to facilitate conversations that lead to the delivery of NDC capabilities that work for airlines and for travel sellers.
TD: What do OTAs, leisure agencies and TMCs think about NDC?
MS: Agencies are interested in the promise of NDC, but wish progress were faster – as do we all. As with any new technology, there are early adopters and companies that may never adopt. The common denominator is broad interest in the topic and a desire to become better informed. An example of this dynamic I can share is our recent participation in a Qantas-hosted agency education seminar in Australia focused on NDC. The room was packed. It was energizing for the Sabre team members on-site to demo our NDC capabilities and answer attendees’ questions.
In January, we look forward to participating in a similar agency education session that Singapore Airlines is hosting. Strong attendance at these types of events signals agencies are interested in figuring out how NDC fits into their operations. They want to see more examples of innovative content from airlines, such as the recent discounted fares Qantas announced that they are making available through NDC connections. Agencies keep a close watch on productivity metrics, so they want to ensure a compelling return-on-effort exists. The more we can all do to clarify the value NDC can deliver to agencies, corporate buyers, and travellers, the easier it will be to encourage companies to leave the sidelines.
TD: What challenges do buyers and sellers face in adopting NDC?
MS: For agencies, access to content and operational efficiency are key. Agencies tell us they are eager to see airlines create more differentiated offers through NDC connections. They want to see more innovative examples of content bundles and tailoring to different traveller segments. Remember, NDC is not fully mature. The standards continue to be defined and to be refined. In some cases, current NDC workflows are not as streamlined as existing processes. They will get there over time. However, if an agency is going to ask their frontline team members to step outside of existing processes – even on an interim basis – they want to understand what value they will get in return for investing that effort.
We are addressing agencies’ needs in our development. Our agency booking solution, Sabre Red 360, features an optimized display where NDC offers appear alongside traditional ATPCO/EDIFACT options. This reduces the number of steps required to access different types of content and makes it easier to compare options and make informed purchases. As I mentioned earlier, flexibility is important to travellers, and agencies want to provide efficient support when plans change. As a result, we are focused on rounding out a robust suite of servicing capabilities by the end of this year, which includes cancellations, voids, refunds, and exchanges.
In terms of corporate buyers, we have heard feedback that there is a general desire for more transparency from online booking tools (OBTs) about their NDC plans. The OBTs will strongly influence the pace of NDC adoption within corporate travel. So, corporate buyers want to understand how OBTs are optimizing displays and user experience; considering the duty of care responsibilities and corporate travel policies; and sequencing the delivery of NDC capabilities. At Sabre, our online booking tool, GetThere, has supported NDC offers since Q4 of 2021. It interoperates with agencies that use our agency booking solution, Sabre Red 360, which enhances efficiency.
“No one company, or one sector of the travel industry, can bring NDC to life on its own.”
No one company, or one sector of the travel industry, can bring NDC to life on its own. Re-tooling processes that have been in place in the industry for decades is a group effort, so activating and accelerating NDC will take time. Imagine that each stakeholder in the travel value chain – airlines, aggregators, agencies, online booking tools and corporations – is a dial in a combination lock. And, the dials need to be positioned in just the right way, considering commercial terms, markets, capabilities, and technologies, in order to unlock NDC’s full potential for the industry.
