Ai Video: Skyscanner gears up for differentiation, are airlines ready?

First Published on 22nd September, 2017

Shopping for flights tends to get mundane when travel e-ecommerce sites or apps come up with an overly generic or inconsistent presentation of product attributes. As key players in the flight search category, meta-search engines are being counted upon to let travellers understand, compare and personalize their trip essentials by overcoming data, technology and user experience (UX) hurdles.

How close are airlines to letting travellers visualize what they have to offer - Wi-Fi, power ports, seatback entertainment, food, seats, in-flight shopping, specific aircraft, baggage etc.? Yes, one can garner and compare basic information, but there are also signs that some concrete, functional information about product attributes is being showcased.

Filip Filipov, VP, Product Management at Skyscanner, says, “As we go deeper into the purchasing funnel (working with certain carriers for the same), we are now showing how big is the seat pitch, what is the actual seat like (in terms of photographs/ rich content)…ultimately it comes down to whether the airline is able to provide information to us. We do intent to show as much as we can, but it’s a question of technological advancement (where airlines are able to pass on the requisite content)."

In this context, the role of IATA’s XML-based standard NDC (New Distribution Capability) is being continuously scrutinized. Filipov says the standard has simplified the ways the API is structured. So, for examples, every airline would define their attributes, say baggage or in-flight entertainment, in a certain manner. So considering the number of airlines, every single definition then becomes an exponential problem for an intermediary like a meta-search engine.

Considering that there was “too much flexibility in the initial versions of schema and implementations weren’t the same”, intermediaries are hoping that this aspect would be taken care of in the future. The challenge for an intermediary arises considering that airlines have developed their API based on a different or a certain version of the NDC XML standard. So aggregation of multiple airline APIs requires further work to achieve the desired result.

For their part, Skyscanner is open to the collaborative route, for instance, the concept of airline store-front on their platform where shopping is practically identical experience to one on airline.com.

The team at Skyscanner is experimenting with rich content, be it for photographs or videos at this juncture, to improve upon the experience of the shopper. Of course airlines, too, need to play their part in making this a possibility. So, yes, attributes of a particular flight are being displayed, but there is no video yet. But one can expect lot more immersive experiences in the future, may be 3-4 years from now on. 

Hear from British Airways and Skyscanner about the role of meta-search and the contribution of NDC in improving merchandising at the upcoming 8th Mega Event Worldwide, to be held in Palm Springs, CA, USA (29 November – 1 December, 2017).

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Ai Video: Jay Sorensen on Branded Fares

First Published on 28th August, 2017

Branded fares allow a traveller to upgrade his or her experience. Travel shoppers aren’t always after the lowest fare; in fact a considerable set of travellers are open to paying for a premium for more comfort and convenience.

Among a number of factors that go into finalizing branded fares, a basic criterion that is applicable is to go ahead with 3 options. “Research has shown consumers are more tempted by a “middle choice” when three are presented,” says Jay Sorensen, President, IdeaWorksCompany, who referred to SWISS’ way of presenting the same. “SWISS adds to the attraction by flagging its Classic fare as “recommended” and using a visually larger display box.  The features for each fare are listed in a simple and transparent style,” he said. 

It is also recommended that focus should be on simplicity, for instance, add bullet points to list the features associated with each branded fare product. Avoid generic display of information that isn’t directly related to the decision-making of the traveller.

Sorensen also mentioned that the basic premise of choice needs to be supported by apt pricing strategy, and the price distinction needs to be consistent irrespective of the starting price of the base offer. Other areas of consideration include whether to set up itinerary flexibility into the branded fare choices or not, the profile of ancillary items in terms of their margin, excusive service or ancillary item that isn’t otherwise available for sale etc. 

 

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Ai Editorial: How does Amadeus see NDC connection and commission for agents?

First Published on 23rd August, 2017

Ai Editorial: How quickly can NDC connections bring about a big change in the manner in which travel agents go about selling airlines’ offerings? What about the long association between GDSs and travel agencies? Ai’s Ritesh Gupta spoke to Cyril Tetaz, Head of Commercial, Asia Pacific, Airlines, Amadeus, about the same.

 

A couple of months back, American Airlines with their NDC connection, featuring end-to-end shopping, booking, and ticketing capabilities plus new content and functionality, introduced $2 per flight segment NDC commission as part of their NDC incentive programme. 

There are interesting aspects associated as far as the participation of travel agents is concerned. For instance, how would agencies go about developing an NDC connection? What happens to agencies-GDS volume agreements?

American has mentioned that NDC is not designed to create extra work for travel agencies, and in fact, this will provide agencies with richer sets of airline products and services to compare when using NDC, “which increases consumer choice as compared to today’s legacy GDSs, which may be constrained by outdated technology“. At the same time, travel agencies are responsible for their own hardware costs.

So it is also important to assess how does a stakeholder of Amadeus‘ stature foresees such developments shaping up.

Association of agents with GDSs

Is the dependency of travel agents solely on GDS getting reduced year by year?

“We don’t believe that’s true,” Cyril Tetaz, Head of Commercial, Asia Pacific, Airlines, Amadeus

“Travellers want consistency, transparency and choice and the GDS remains the most cost-efficient way for travel agencies to deliver that to their customers. Amadeus allows our travel agency partners to connect to the richest and most relevant array of content on a single platform. We imagine that managing multiple connections or platforms would require a substantial level of investment, effort and IT skills for travel agencies. “

Tetaz also emphasized that what Amadeus offers no other GDS or channel can replicate – the Altéa community model.

Over 130 of the world’s airlines, including some of the largest, use Altéa for their PSS.

“Altéa and the Amadeus GDS are built on a common platform which means Amadeus travel agencies booking Altéa airlines enjoy best data accuracy and cross-channel consistency. Benefits include fare accuracy, automatic frequent flyer validation, instant SSR (Special Service Request) confirmations, and guaranteed last seat availability,” he said. “Any changes made to a traveller’s PNR by the travel agency is immediately seen by the airline and vice versa. This is a level of service that our travel agency customers appreciate they can offer to their travellers.”

Business processes and functioning of agents

A section of the industry is pushing airlines to re-look at the process of creation of their offers, sharing of fares via static filings, and even 3rd parties creating the offers on behalf of the airlines.

Today airlines typically publish fares through ATPCo and all distributors have easy access to them. Furthermore, the current model also relies massively on caching technology for fares and availability.

“This brings speed (in response time) and cost efficiency for all travel players. As a result, travel agents do not depend entirely on airline systems to make an offer for the traveller. As we’ve seen in their public response to NDC, these are things that concern travel agencies and must be taken into consideration for whatever new model comes into play,” mentioned Tetaz.

If we talk of XML connectivity, Amadeus has also been distributing LCC carriers with XML connectivity since 2008. What are issues with adoption of NDC, is it “too much flexibility in the initial versions of schema” and interpretation being different the main issue? How agents need to move along?

Tetaz highlighted that the cost and difficulty of integration remain quite high and may be difficult for some parties to address.  He said airlines have been largely focused on Level 3 connectivity (Offer and Order Management) that would allow airline offer creation as well as order creation, retrieval, change and travel document issuance, payment and refund to be done via NDC-XML technology.

“IATA has also been highly focused on providing standards around this. But this represents a major booking flow redesign and requires travel agents to invest in NDC interface adaptation and costly IT integration,” he said. “In fact, there are many ways of integrating NDC, and Level 2 connectivity (Airline Offer Management) is one of them. Here, airline offer creation through search and pricing of flights and ancillary services would be done via NDC-XML technology, without impacting the booking, servicing, payment and ticketing steps. However, Level 2 connectivity has not yet been defined by any industry player. “

Options for integrating NDC are still in the making and being discussed by all players.

“Within the context of NDC, our vision is to develop an integrated solution that can be widely adopted by both travel agencies and airlines to deliver sustainable results at a scale that matters. The objective is to ensure easy adoption in the marketplace with minimal disruption and to meet the business objectives of all parties. Collaboration across the industry will be a key factor in driving success for all players,” mentioned Tetaz.  

Merchandising, GDS and agents

Amadeus says they are making sure that branded fares and ancillary products are available through all channels – direct and intermediated. The team has been working with over 128 airlines to date to bring to the market their ancillary services offerings. During the 2014-2016 period Amadeus has witnessed a 125% CAGR on ancillary bookings done through travel agencies using the Amadeus system, with a significant growth in attachment rate across travel agency segments.

“Furthermore, we have seen double-digit growth when it comes to the number of airlines selling their fare families through Amadeus. This has facilitated the selection. of fares by travel agencies for their clients, as well as being a powerful upsell tool that has generated significant incremental revenues for airlines,” said Tetaz.

Meet executives from Sabre, Amadeus IT Group, Datalex, Farelogix, Travelport, OpenJaw Technologies etc. at this week’s The Mega Event Asia-Pacific 2017 - 4th Annual Profitabilty Summit, to be held at the Grand Mercure Roxy Hotel in Singapore (23-25 August, 2017).

 

For more, click here

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Ai Editorial: How is Sabre placed today with “rapid of evolution” of IT offerings?

First Published on 21st August, 2017

Ai Editorial: “Any competition is good. We are the leaders, we are the innovators, we continue to invest significantly to maintain and expand our position,” says Rakesh Narayanan, VP of supplier commerce, Asia Pacific, for Sabre Travel Network. “For us, it is not about a point solution, we look across the whole ecosystem where we can add value.”

 

By Ritesh Gupta - One big challenge that airlines need to address today is how to offer a sublime experience to passengers. There is no doubt the journey of planning, shopping, travelling and even beyond needs to add to the joy of travel.

In order to being inspirational to offering choice to seamlessness to serving in a contextual manner, it is being evaluated to what extent the status quo is being challenged. This includes dealing with the combined impact of complexity in both technology and distribution that leads to inconsistency for the passenger,

Expectedly, the role of travel B2B conglomerates has been under the scrutiny.

It is being highlighted that what airlines manage to do with their content and merchandising via direct channels, replicating the same via the indirect ones has rather been slow. So constraints remain to extend this capability to intermediary channels, but that’s not a technology constraint, rather an evolving business model to be tied down with airlines partners.

So lots of critical questions are cropping up:

·          What is being done to improve upon the overall IT infrastructure, industry-specific business processes, e-commerce and merchandising, distribution connectivity etc.?

·          Are airlines moving on from tightly integrated processes?

·          How can airlines craft an offer and show their content in the best possible manner via intermediaries?

·          Is the reliance on the GDSs set to come down? How indirect distribution is evolving?

·          How quickly can airlines introduce a new offering across all channels?

·          Is there going to be any change in “full content” agreements?  

And as a consequence, the tussle around the best-of-the-breed vs. a single vendor for all commercial as well as operational needs of airlines is interestingly poised. In this market, it isn’t easy to dislodge traditional players and their volume-driven, transaction processing-oriented business models.  

Sabre banks on “rapid evolution”  

From Sabre’s perspective, Rakesh Narayanan, VP of supplier commerce, Asia Pacific, for Sabre Travel Network, asserts that the organization is evolving, just as different airlines continue to move ahead with different strategies.

What works in an organization of Sabre’s stature is the fact that they are a provider of mission-critical offerings, spanning across reservations, operations, commercial and data and analytics.

If we talk of reservations only, a decision to shift to a new solution can take years. For example, as it emerged this year, Southwest’s move to bring together multiple reservation system capabilities onto one common platform took 3 years or so, featuring over 1500 people!

On top of their ability to deliver offerings for commercial and operations of an airline, organizations like Sabre act as strategic partners from a consulting perspective, too. “Being a technology company, we believe technology can be a differentiator for airlines to be successful and we get involved early on from the strategy stage,” mentioned Narayanan, who added that Sabre has introduced more than 31 new solutions in the last 2 years or so. “There has been a rapid evolution of various technologies, modules, applications, software (at Sabre)… on the PSS side and other areas for airlines” to benefit in a significant manner. But as witnessed, certain airlines have been separating core functioning of a PSS that are needed to run operations, and opting to control their own merchandising, e-commerce and API technologies for differentiation. “Technology is evolving, the marketplace is changing, travellers’ behavior is changing…if you look at some of the markets, web and mobile commerce is outpacing some of the relatively mature markets. So whether an airline opts for an integrated offering (from us) or works with multiple partners, we are supportive (of that, too). From our perspective, a real differentiator and value addition from Sabre is the integration piece.”

How are Sabre’s solutions including the PSS, Revenue Optimizer, Digital Experience, data and analytics etc. coming along? Aren’t new age IT companies taking lead, be it for letting agencies sell say advanced seat selection capabilities or branded fares or distribution of content via APIs?  

Sabre has been asserting that the products from 3rd party specialists are worked out in “isolation” and entail  “manual intervention” to garner and put together the requisite information from passenger-service and operational systems, “resulting in delayed and inconsistent offers”. The team also emphasises that working on a retailing mindset means carriers have to plan for an astute IT architecture that is “extremely flexible, scalable and able to handle thousands of sophisticated transactions using real-time or near real-time data in a matter of seconds”.

Referring to how the team has been working on right tools to enable airlines to make more money, Narayanan referred to the Digital Experience platform, which has been designed to optimize web-based offer execution. Terming the newly introduced offering as interactive and customizable, he said that flexibility and agility is coming into the marketplace for airlines to make changes, considering the significance of time-to-market and differentiation. The architecture is as such that there is provision for contextually-rich customer data between SabreSonic core services applications, its retailing platform, encompassing ancillaries, brands and non-air sales; and the Digital Experience, which distributes the optimized offer throughout various web-based channels. Sabre also allows airlines to dynamically combine and make packages based on a specific set of variables or based on value, for instance, frequent flyer program, spend with the airline etc., shared Narayanan.  

Narayanan also referred to the introduction of Sabre Red Workspace, which allows agencies to visualize airlines’ offerings via apt mix of content (branded fares, graphical seats maps etc.) and data (seasonality, weather etc.). “If travel consultants (agents) are able to communicate better, they can sell better.”

Data, tools and revenue generation

Another area that Sabre has been working on is their customer data hub and, as Narayanan says, the same isn’t just about FFP or previous spend or travel with Sabre.

“It is a comprehensive view of the traveller, their experiences with the airline, providing that data at multiple touchpoints. And this, too, not only at the time of making an offer or position on price during the sales process, but even beyond that. So be it for post booking, the day of travel, etc. what kind of value addition can be done to enhance the trip? So Sabre asserts that in their technology, it is possible to assess whether a passenger is likely to buy an upgrade at the airport or lounge access voucher. The ability to up-sell or work out a tailored ancillary product and to be presented by the airport staff is a possibility.”

“It also helps on the service part. If a passenger had an indifferent experience then he or she could offered an upgrade or free Wi-Fi as per the policy of the airline.  So the PSS allows to support customer service and revenue generation opportunities,” said Narayanan, underlining how the core functionality of the mission-critical system is evolving and supporting requirements for e-commerce and retailing.

In addition to this, Revenue Optimizer combines with the PSS and looks at maximizing revenue on a segment as well as the entire journey of the passenger, could be via code-share partners. It will also start maximizing ancillaries, too. So if there are 6 special seats – whom to sell it to, and how to revenue manage? If there is a passenger who is willing to spend $100 but nothing on ancillaries, and $90 on ticket plus $20 on ancillaries, then Sabre is in a position to target the latter. So can a new product, say lounge pass, can be introduced a matter of weeks? According to the company, Sabre’s Dynamic Retailer roll-out has initiated, and the company says in “pretty much” in real-time assembling of different ancillaries or put together bundled offers or customized offers or individual offers.

“So Sabre having the portfolio and the underlying platform that allows us to have an integrated solution, and not interfacing multiple systems together, enables us to most effectively provide the service and maximize revenue,” explained Narayanan.

Also, integration of solutions would also feature handling of operations related to disruption.

“A lot of offerings are interconnected in a certain fashion. We experience with airlines what they go through on a daily basis. So in case of a disruption, passenger services take a hit. Aircraft end up at wrong places, it is imperative to put them back in place, get schedules back, manage crew, and ensuring passengers get back to their destination as soon as possible. (One core development is) Sabre has automated recovery management tools. We have an optimal solution i. e. focused on least disruption to the passenger, ensuring airlines are  operationally viable and not violating any rules/ regulations and keeping disruption cost and impact on service to minimum,” added Narayanan, again asserting the significance of a platform that can support critical functions.  

(Stay tuned for Sabre’s perspective on distribution including full content agreements, direct connectivity, NDC and lot more).

 

Meet executives from Sabre, Amadeus IT Group, Datalex, Farelogix, Travelport, OpenJaw Technologies etc. at this week’s The Mega Event Asia-Pacific 2017 - 4th Annual Profitabilty Summit, to be held at the Grand Mercure Roxy Hotel in Singapore (23-25 August, 2017).

For more, click here

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Ai Editorial: Knowing a passenger inside out – the journey has just started

First Published on 16th August, 2017

Ai Editorial: It is the dream of every marketer to have a rich set of customer data that is consistently available at every touchpoint. Can one unified marketing stack strengthen the pursuit of “single view of the customer”, probes Ai’s Ritesh Gupta

 

The concept of “single view of the customer” has been around for a while. But, for me, as a passenger, it has repeatedly fallen short of expectations.

To put it simply, an interaction with a brand, be it via a company-owned digital touchpoint or any physical one, isn't a seamless one i. e. not based on every data trail or the data strategy seems to be disconnected. So, for instance, as a leisure traveller I have had indifferent experiences with a couple of airlines in the recent past, and despite sorting the issues out via a call, when I have accessed the website (from the same device and IP address), there hasn’t been any recognition of my previous activity and experience.

Transition has initiated

However, there are certain travel suppliers that are working on platforms supporting the idea of customer profiles.

Over the years organizational silos have proven to be too big a snag to fully focus on the customer.

Organizations need to reform themselves to make all of this a possibility and there are doing so.

As we highlighted in one of our recent articles, Bangkok, Thailand-based ONYX Hospitality Group is capturing data right from what triggers the search to the next trip, and this entails what people tend to do and what are the opportunities to influence the behavior of the traveller.  

There is clarity on the following areas:

·          What data needs to be collected from each touchpoint?

·          What system will be involved at each touchpoint?

·          Where the data will be stored at that touchpoint?

·          Who will be the owner of that data once is collected?

Airlines that are looking at maintaining single view of the customer aren’t leaving any opportunity to make the most of data from “log-ins” (could be a social login-in on their website) or their members. “If we know there is a booking from an OTA, we instruct our front staff (in hotels) to get customers’ email id,” said a senior hotel executive. The main focus in letting customers experience rich, experience via a direct touchpoint, and this is one way to do so is by enrolling them into a loyalty program.

So the level of sophistication is rising with initiatives, propelled by today’s open platforms, such as:

1.     Being aware of all interactions with a company.

2.     Pre-empting what a passenger would be looking for based on profile, interests, and actions taken, may be a spa package for a couple on their next anniversary.

3.     How to optimize experiences at each touchpoint? For instance, how to interact with guests at the hotel reception desk of the hotel or with passengers at the check-in counter at the airport?

4.     Automating delivery of content or offers when conditions for a rule defined are met

5.     Data is integrated from various systems and this can result in empowering staff with relevant information when it is needed most. For instance, staff at the hotel front desk is being today offered two screens – PMS plus actionable information about the customer via another screen.

6.     Where is the traffic originating from, site behavior etc.? How is the conversion coming along?

So clearly these platforms are enabling airlines to be in better control of what they can do on their digital assets. This reflects in terms of what is being shown to users in real time, based on past behavior, on the IP address etc.

Outside company-owned assets

It is the dream of every marketer to have a rich set of customer data that is consistently available at every touchpoint that they would want to use to personalize the experience – be it for buying a banner ad, tailoring an email or how the staff recognizes the guest and greets a loyalty program member.

But considering that people are using more and more devices, across more platforms, this explosion of data at different locations continues to pose a bigger challenge. Not a straightforward task to gain a single view of the guest.

More than automated decision-making, it looks as if disconnected data is a bigger challenge. If technologies are disconnected across channels, then there won’t be any single view of the customer journey, and this means one would struggle to personalize in context. The promise of shaping these profiles on the basis of real-time data is fine. But if we talk of the same being collated from every source or channels, there is still a long way to go. There are certain areas that are beyond the control of a hotel or an airline. For instance, the level of data transparency in case a travel e-commerce works with ecosystems like Tencent, Alibaba or Facebook would wary. Also, travel suppliers really don’t expect sharing of data when we talk of experience of a customer who has booked via an OTA.

“So what we are trying to do is leverage a marriage of 1st party data and 3rd party data to deliver the most effective marketing spend and relevant marketing content,” said a marketer. “It is also important to handle local intricacies – for instance, mobile numbers and not email addresses are used for matching criteria between data sources in China.”

The advertising technology space has evolved considerably and continues to do so. For instance, 3rd party data is facilitated in a swift manner as compared to even few years ago. Travel e-commerce players can buy data, avail APIs to upload lists and do matching and lookalike modeling. But is it enough? Travel marketers need to sort out issues related to single view of the customer to deliver contextual experiences and eventually 1-to-1 personalisation – be it for time and cost of implementation, how to integrate with channels, how to activate data, dealing with cultural challenges within an entity etc. Other than managing 1st party data, airlines also need to act on other sources of data. The key question one needs to consider – how can one unified marketing stack strengthen the pursuit of “single view of the customer” and also overcome the elusive match rate hurdle.

 

Where do you stand with your data strategy? Hear from the travel industry executives at the upcoming The Mega Event Asia-Pacific 2017 - 4th Annual Profitabilty Summit, to be held at the Grand Mercure Roxy Hotel in Singapore (23-25 August, 2017).

For more, click here

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Ai Editorial: Airlines + meta-search, how NDC is strengthening the bond?

First Published on 11th August, 2017

Ai Editorial: Meta-search continues to be an attractive proposition for airlines, considering its place in the booking funnel. But as airlines target new ways of connectivity, they also need to scale up for the meta-search world in a cost-effective way, writes Ai’s Ritesh Gupta

 

A traveller doesn’t differentiate between interfaces and channels - it could be an airline app, Facebook Messenger, a WeChat chatbot etc. or could be airline.com, OTA.com, meta-search engine etc. As long as one is being served apt content, choice/ recommendation, offer, payment method…it’s fine.

Airlines, meta-search engines, OTAs etc. have to find out ways to crack seamlessness, one that depicts understanding the intent of the traveller as per the booking funnel and aiding them in taking a decision.

The industry needs to add to the joy of travelling, and take painpoints out of the equation. Be it for itinerary, in-flight meal, clarity over seating and baggage allowance, experience at the airport and so on makes a trip worthwhile.

In this context meta-search engines are being keenly followed, considering that their position comes into play quite early in the booking funnel.

Evolving role of meta-search engines

If on one hand, meta-search companies are even “moving further up” via features such as traveller inspiration timeline and push notification of travel ideas, on the other side they are also drifting away from pure lead generation. The focus is on meeting requirements of a trip, rather than just offering standalone products, and also facilitating transactions within the meta-search environment.

And there is more to this, as the category is looking at fulfilment and customer service, too. At a time when even the definition of direct distribution is being questioned, it is worth assessing how meta-search engines approach the omni-channel shopping. If “instant booking” isn’t enough, then what are meta-search engines working on? How are they working with airlines to showcase their products, including branded fares, bundled products etc.?

Meta-search engines have been working with airlines to craft an attractive merchandising offer with rich content (for instance, baggage allowance, upgrade options etc.) and whatever can differentiate the offering. One key development here is IATA’s data standard NDC.

 

Standarization via NDC – a work in progress

Even as airlines have been working on the objective of letting sales partners connect to their IT systems directly based on the IATA NDC standard, it is clear that there was too much flexibility in the initial versions of schema and implementations weren’t the same. As one executive pointed out, “The big problem came when the players like KAYAK and SkyScanner, and NDC consuming parties tried to build a one-time NDC connection in order to connect to multiple airlines with the least amount of effort considering that a standard was being planned. But the reality is that because of the varying level of interpretation, connections had to be modified somewhat. So with implementers providing their feedback to the IATA, the industry body has worked out a data modelling exercise. So they are redefining and tightening relationships in the NDC schema to ensure that the flexibility and looseness of the interpretation will go away. The new 17.1 scheme are going to be partly generated from the new airline data model and later on 17.2, the full schema set would be generated from the IATA data model. So when that’s done, there should be standardization in projects and implementations.”

A senior executive with a meta-search engine mentioned that for the company or the category in general, there are many different sources of a product - via GDSs, airline-direct, OTA-direct etc. “There is a network of connectivity and the objective is to aggregate as much as possible.  But we need to standardization job as well. We do focus on it, as if entities converge on that, it would be beneficial for us, too. It is still a work in progress, as others are moving, too. And everyone has their own agenda, and time scale.”

So what happens when there are different versions of one standard, then aggregating multiple airline APIs requires the “normalisation” of these APIs into a single version. As of now, it seems like over the past few years, there will be evolving versions of the schema that will impact the specific XML messaging, in that messages themselves will change over time – new ones added, existing ones modified, etc. So considering that airlines have developed their API based on a particular XML standard (NDC or even other), it would result in different interpretation of these standards.

As for airlines, there is a need to re-look at their own IT infrastructure to refine retailing capabilities. In fact, the industry is already looking at major transition, embracing cloud-native, API-led architecture as part of digital transformation. As for sector-specific systems, airlines have been separating core functioning of a PSS that are needed to run operations, and opting to control their own merchandising (control over distribution as well as showcasing core product and air ancillaries to depict value to passengers), e-commerce and API technologies for differentiation. Also, airlines need to scale up for the meta-search world in a cost-effective way, delivering massive search volumes without look-to-book restrictions and the ability to respond in fraction of a second.

Hear from Scoot and Skyscanner at MegaAPAC in Singapore

Trevor Spinks, Head of Sales & Distribution, Scoot and Filip Filipov, VP Product Management, Skyscanner are scheduled to speak at the upcoming The Mega Event Asia-Pacific 2017 - 4th Annual Profitabilty Summit, to be held at the Grand Mercure Roxy Hotel in Singapore (23-25 August, 2017).

 

For more, click here

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Ai Editorial: Assessing the role of cloud-native applications in digital transformation

 First Published on 7th August, 2017

Ai Editorial: Airlines recognize that speed is of essence when it comes to the efficacy of their customer-facing systems. Ai’s Ritesh Gupta explores the role of a cloud-native architecture in delivery velocity as part of the overall digital transformation.  

 

Airlines have been relying on cloud services platforms, signalling a shift in the IT consumption model. So rather than paying for IT infrastructure capacity upfront, today’s organizations are opting for pay-as-you-go model, accessing servers, storage, databases and application services over the Internet.

As seen over the years, cloud has played a key part in digital commerce. For instance, page speed is critical, with every millisecond being crucial. So to step up the conversion rate, cloud infrastructure was chosen to keep latency to minimum, supporting application servers and databases in specific regions to support users.  Airlines have been relying on cloud technologies to deliver services such as luggage drops with label printing and self-boarding gates, and personalisation by enabling the customer-facing staff, for instance, providing the airline’s cabin crew with contextual, relevant information to serve their loyalty program members in a consistent manner.

As for emerging cloud developments, airlines can step up their ancillary revenue generation by capitalizing on journey data. As it emerged during our Ancillary Merchandising Conference in Spain this year, a new 3rd party cloud-based platform is emerging that can integrate airline’s inventory system and central reservation system to display contextually relevant information or ads in real-time. So airlines can make the most of their data to garner incremental revenue. Also, in the wake of outages, it is being pointed out that mission-critical systems have to move to the cloud, ensuring stored backups are secure, data is stored in multiple locations to ensure sufficient backup etc.

Cloud transformation

Airlines are scrutinizing and even executing plans to embrace cloud transformation, banking on open-source offerings rather being bogged down by proprietary technology.

Focus is on ways to integrate real-time data, search, and analytics into applications to optimize travellers’ journey. This essentially has become an integral part of digital transformation, a massive undertaking that features speedy and constructive progress on several counts to strategically leverage digital technology.

In fact, considering the complexity of the IT set up that this industry has, there are options available to integrate applications, data and processes across both on-premises and cloud environments. There are 3 models for cloud computing - Infrastructure as a Service, Platforms as a service and Software as a Service.

Taking advantage of cloud computing:

·          Use cloud as a route to market (APIs are the digital services)

·          Garner data, integrate data from multiple sources

·          Create and capture value – optimize traveller’s journey

Among established organizations in this industry, American Airlines has decided to migrate to cloud a quota of their crucial applications, including aa.com, mobile app and network of check-in kiosks. The plan is to enable developers to swiftly set up and modify application functionalities for American’s passengers. These customer-facing systems will be on cloud. As American chose to move its applications into the cloud, it considered factors such as security (the role of technologies such as encryption and tokenisation comes into the picture) as well as connecting legacy applications to the cloud at enterprise scale.

The cloud business model that the airline has chosen is a hybrid one.

According to the airline’s partner, IBM, the airline would maintain backend connectivity to other on-premise legacy and third-party systems, for “true hybrid cloud functionality”.

Cloud-native architecture as part of digital transformation

As American says, the goal is set up a cloud-native architecture.

What does this mean? It is about capitalizing on cloud computing – making use of vast computing power on-demand and pay-as-you-go. An organization needs a platform for running cloud-native applications and services, as a method for abstracting away from core infrastructure dependencies. For their part, American Airlines intends to create, try and release applications frequently and speedily. Also, all of this would be change ready for release as soon as it is ready. This would be made possible via a microservices architecture (working on an application as a collection of small services; each service implements business capabilities), agile methodology, continuous delivery (individual software updates available for release as soon as they are ready), DevOps (association between software developers and IT with the objective of automating the procedure of software delivery and infrastructure changes), and lean development. So a cloud services platform is must for operating cloud-native applications and services that automates and integrates all these concepts that fall under digital transformation.

Preparation

Harnessing cloud for digital transformation isn’t a straightforward process, with re-designing of IT architecture or operating in functional silos within IT being primary challenges.

For cloud service delivery, some of the areas specialists recommend that airlines need to assess:

·          Assess business goals and their alignment with current IT ecosystem

·          How to move to a structured, agile program? Evaluate technologies and the role of staff to deliver new applications

·          Ensuring IT understands the business challenges and is aligned with the DevOps cycle

·          Finalising cloud service delivery model  

·          Operating model and training – detailed insight into IT architecture, data and technology

·          How to migrate applications to a cloud-native microservice architecture? What makes for a resilient cloud native microservice architecture?

·          To what extent one can bring down the probability of prolonged irregular operations?

The days of traditional software development and infrastructure management processes are getting numbered. Cloud has positioned itself as a competitive advantage, letting developers optimize what they offer and presenting airlines with an opportunity to run with lean methodology and automated IT operations.  

 

Hear from senior travel industry executives about digitization and ancillary revenue at the upcoming The Mega Event Asia-Pacific 2017 - 4th Annual Profitabilty Summit, to be held at the Grand Mercure Roxy Hotel in Singapore (23-25 August, 2017).

For more, click here

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Ai Video: Making data analytics accessible

First Published on 4th August, 2017

Travel companies can now count upon cloud-based XML API analysis that helps them in near real-time to understand inbound and outbound shopping traffic from the booking platform. Such cloud-based offerings are useful even for those e-commerce players whose data volumes do not justify major investment in infrastructure and skilled analysts, says Jonathan Boffey, Business Development Director at Triometric. So travel suppliers can access key operational metrics and count on data-driven methodology to improve upon the same.

“The objective is to make data accessible to smaller and specialised travel companies with less data volume, a wealth of shopping analysis to help them thrive in this competitive and margin sensitive business.”

Suppliers can assess areas like product fit, product availability (evaluating product issues, ensuring that inbound availability searches are being correctly returned), look to book ratios, market trends and buying behaviour as it happens, track bookings in terms of volume, product type and transaction value, gain an insight into the performance of the indirect distribution partners, what to change if performance isn’t up to the mark etc.  

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Ai Editorial: ONYX targets real-time, 1-to-1, personalised interaction with guests

First Published on 2nd August, 2017

Ai Editorial: ONYX Hospitality Group is undergoing a transformation that would enable the entire team to “talk everything in terms of a customer profile”. Of course, data is vital to all of this, but by breaking down silos and offering apt training to the staff, a foundation is being laid for a customer-centric culture, writes Ai’s Ritesh Gupta

 

Customer data platform, data management platform, master data management…these offerings related to management of data have a key to role to play in an organization’s transformation towards customer-centricity.

But how these platforms actually contribute in serving a traveller? What else needs to be done to make it an enterprise-wide initiative?

One organization that is in the middle of such transformation is Bangkok, Thailand-based ONYX Hospitality Group, with a regional portfolio of over 40 operating properties.

“We talk everything in terms of a guest or customer profile,” shared Chetan Patel, ONYX’s Hospitality Group VP Strategic Marketing and E-Commerce. “We are moving towards real-time, 1-to-1, personalised, seamless interactions with our guests. That’s the end goal,” says Patel. The company is working on a new platform, being referred as a CRM platform by ONYX.  

The team is still in the process of completing what it has set out for. But it does mean that ONYX is breaking shackles in terms of what impedes customer-centricity in today’s complex shopping environment. “This (new CRM platform) is a way to break silos, via a single point of truth. So whenever one refers to a customer, there is one place where there is the end of the line as far as information is concerned. On one side (of the new platform) we have database about the customer and profiling, and then using the data on the other side to communicate with the customer,” shared Patel. 

We explore 5 key areas of transformation:

1.     Enterprise-level data-driven decision-making: Silos in a business organization exist, and this doesn’t help as the journey of travellers has evolved from being linear to a dynamic one with real-time “micro-moments” in an omni-channel, multi-device environment. So as we spoke of data platforms, Patel did refer to the difference in digital marketing and information management. But, as a result of this new undertaking, ONYX is streamlining operations around data and analytics at the enterprise level. It has been in the pipeline for a year or so.

Today travel organizations acknowledge the significance of collection and correlation of real-time event information into actionable knowledge, plus gearing up for sharing of data across business functions, and the information management framework has to facilitate connectors to today’s diverse sources of data. A department has to act, and cohesively the effort needs to serve the guest/ passenger. 

As for the real utility of this data, it comes from the fact that the entire customer journey is being mapped out. The focus is on how to collect data from each touchpoint and how to interact with the guest – to reach out in a relevant manner as per the booking funnel. “We are basically looking at the CRM platform (with functionalities such as data integration, analytics and integration with web experience management etc.) to do that,” shared Patel.

So, as per the latest dashboard based on the data platform, ONYX is capturing data right from what triggers the search to the next trip, and this entails what people tend to do and what are the opportunities to influence the behavior of the traveller. “The entire journey is being evaluated for our own systems and touchpoints,” mentioned Patel.

There is clarity on the following areas:

·          What data needs to be collected from each touchpoint?

·          What system will be involved at each touchpoint?

·          Where the data will be stored at that touchpoint?

·          Who will be the owner of that data once is collected?

2.     Data in one customer profile, the base for experience and revenue optimization: A vital aspect is responsibility towards collection of data, and this gets incorporated into the customer profile wherever possible. Various touchpoints and people are responsible for collecting data and reaching out to customers, with everything being spoken in terms of “customer profiles”. “There is a holistic approach to the entire strategy – CRM and team, and everything else will fit into this,” shared Patel.

So, for instance, a user is looking for a property in Phuket after coming across his friend’s experience. He conducts research, comes across an ad from Amari and clicks on it. This data is available in clickstream, but may not be personally identifiable. But once this user lands on the Amari website, there is a possibility to connect with other aspects of the user’s online profile (for instance, Facebook integration on the website, automatically log on to Facebook part of the website, hotel’s Facebook page is listed on the hotel’s website). “We start joining the pieces of the puzzle. Once they return we glean more information. They click on spa, check spa packages so the web experience platform will automatically start profiling the customer. And it will keep the profile in the background in the data. Next time the same user comes on the website, using this past interaction and browsing pattern, content can be customized. So as per the interest shown, the relevant content can get them closer to a decision or conversion.” In case of first time users, they are profiled on the basis of browsing pattern, and from 5th or 6th page onwards, they are served relevant content.

“The web experience platform is in the execution stage, our first website should be live (on this) in September. Also, there is one RFP out there for a CRM system, which will be a single point of truth for all customers that come across us. This system will be leveraged to send out the guest profile information everywhere, and then customize the content, the experience as much as possible,” shared Patel. For instance, post booking, an email confirmation can have cross-selling options depending upon the information from the profiles in the repository. It could be about an upgrade, spa, romantic dinner etc. Similarly, the guest might look for destination-related information or any other section on Amari’s website, this can be capitalized upon during the pre-arrival phase. “So more the customer visits the site, more data is picked by the CRM system. We can personalise based on all these interactions, so better chances of monetization,” he said.

As of now, the primary source of data is the company-owned booking channels and PMS. “If any additional data can be collected at the property, we would incorporate that as well,” said Patel. He also mentioned that if the company consolidates the social media log-in say via Twitter or Facebook, then whatever is publically available is also considered. 

3.     Personalisation: Every piece of communication triggered by the platform would be on a one-to-one basis. So if a profile indicates that a user’s birthday is coming up or there is someone’s marriage anniversary, then from the 10 pre-defined offers for a particular property based on the business rules set, when the email goes out the CRM platform would find the best fit. “This is for our direct communication and channels,” shared Patel. “Personalisation in marketing means predicting communicating the right message/ offer to right prospect at right time. Personalisation on the ground means more meaningful one-on-one interactions with guests when they are at the property and meeting their needs in a demonstrable manner. All these will increase their propensity to return to our business. Even if we can target a small percentage of our past customers to return, it would be make a sizable difference in our bottomline.”

4.     Using analytics for more direct bookings: ONYX is also looking at evaluating the source of booking and then attempting to convert non-direct bookers. So a guest is being targeted with emails, but continues to book with an OTA, then how to attract this customer? “How can we target this guest differently? May be with a much more aggressive offer? May be with a package that has perceivably higher value? Once they are direct, then we can continue to attract them with activities that are special and again based on their profile, keeps them with us,” pointed out Patel. According to the company, 15% of repeat stays from OTA sign-ups to the loyalty programme were direct.

5.     Removing pain points during the actual stay: There can be a lot of uncertainties at the time a guest is ready to check-in. The size of the room is one common concern or expectation, for example. ONYX is also looking at the platform to supply critical information at the time of guest check-in and during the course of the stay to make it more personalised and relevant based on past behavior. “You must understand a hotel’s front desk is a busy place. Some areas are process-centric, very operational so actionable information (sitting alongside the PMS screen) needs to help in a quick dialogue based on the profile, past behavior etc.,” said Patel, further explaining his point with a couple of examples.

The team would be trained, so if a guest tends to stay in a certain type of room or prefers a particular location, then the staff can offer the same to them. “It is not about monetization, rather customer experience, too,” says Patel. Similarly, if a booking has come from an OTA, then the staff is instructed to collect the email id. “If there is a sports event in the city and the guest has shown an interest in the same, then offering a ticket in an unprompted manner can uplift the experience. Or a property has worked out 10 offers for a particular month, and depending upon the profile of the guest, an email can sent to indicate the availability of a matching offer. This is where we are headed,” asserted Patel. The plan for the future is to evaluate deployment of beacons to relay relevant messages.  

Of course, ONYX Hospitality Group, like every travel organization, will improve in areas like 3rd party data integration and even bank on improvements in probabilistic device matching to better identify travellers, but with such platform the team has laid a foundation for 1-to-1 communication. Even today, as Patel says, ONYX is capable of responding to each and every message on Facebook in a span of minutes/ hours (the brand experiences most traffic on Facebook) and the team will respond to other channels as well. And it is exploring the option of chatbots, too, considering brands need to automate certain areas of communication. The sophistication level of platforms that are available today and their ability to deal with emerging technology such as chatbots is still not there in terms of the sort of end result that companies are looking for.   

The only way travel companies can cut down on the probability of an experience going wrong is by capturing all interactions and this is exactly what ONYX is preparing itself for by capturing as much as data they can and crafting customer profiles. 

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Ai Editorial: How Cathay Pacific and Thomas Cook are looking at virtual reality?

First Published on 24th July, 2017

Ai Editorial: Travel e-commerce brands are exploring virtual reality or VR to offer travellers a feeling of ‘being’ in a place be it for an aircraft or a hotel. This is being enhanced with an element of interactivity, user-generated content etc., writes Ai’s Ritesh Gupta

 

Being in a virtual space as if you’re actually there and indulging in something that lures you, excites you is a worthy experience.

For travellers, there are plenty of novel experiences that are emerging in the realm of virtually reality (VR).

For instance, a family having fun in an interactive virtual environment where each member is using their Facebook photos to customize their respective appearances. Or they can even explore a hotel or the experience of flying business class with an airline, where guests or passengers find themselves in a real-life situation and any query can be answered without leaving the virtual environment. Plus, the idea of completing a transaction, too, is a possibility.

New initiatives in travel

·          Cathay Pacific has launched their first interactive 360º video advertisement, enabling viewers to have a look at the airline’s first class cabin and interact with the setting. Robecta Ma, Vice-President Marketing, Americas at Cathay Pacific Airways, says this particular initiative was “borne out of the necessity to highlight our ground and in-flight experience to those who have not had access to our products”. She said, “We have been experiencing a lot of success with VR in large-scale events and conventions, where people can interact with our brand in a captive environment.”

 

·          Travel agency Ving (Thomas Cook Northern Europe) recently unveiled a new initiative featuring a virtual world Facebook Spaces (beta version launched in April this year). A place where users can meet friends and socialize, show 360-images etc. in a virtual world for guided tours. Movies have been produced to show some of Ving’s destinations and hotels, among them the ever popular Alcudia on Mallorca, as well as the Greek island of Lefkas. To visit Ving in Facebook Spaces, users need a Facebook profile and a particular VR-headset; Oculus Rift. “We want to be at the forefront of testing new technical solutions that will help take customer experience to the next level. Previously, a VR experience has been more ‘individualistic’ but now, through Facebook Spaces, we can bring a whole collective of people together in the virtual world. Recently, Facebook Spaces also launched live 360-degree video,” said Karin Eriksson, Social Media Manager, Ving Sverig. For Ving, the objective isn’t only to show content in an inspiring way, but also to enable interaction between more people in the VR world. “360-degree video will develop and become much more immersive as stereoscopic / volumetric video develops. Then we’ll get a real feeling of ‘being’ in a place,” she said.

 

 

Early days for VR marketing

VR headsets, which fit under mobile or tethered categories, have evolved. Specialists recommend standalone virtual reality apps, embedding VR content in a custom-built website, maximising the reach of such content etc. but all of this is still in its infancy. In one of its recent reports, Worldpay, referring to the readiness of virtual commerce, highlighted the discrepancy across markets. In a majority of developed economies, consumers aren’t ready for it. For instance, only 23% of Dutch consumers believe VR devices are secure for making payments. Whereas the figure shoots up to 59% in case of Chinese shoppers. The study also underlined that pricing of advanced headsets from Oculus and Vive, available for over $700, can be a deterrent for initiating any marketing campaign. Plus, the gap between VR manufacturers’ understanding of consumers vis-à-vis the sort of experiences that marketers intend to deliver also needs to be looked at.

“Even though the travel industry does embrace the benefits of VR as a means of enhancing a customer’s brand experience, the technology is still in its inchoate phase. Hence, most brands are still approaching this in a cautious manner. In our case, we want to make the Cathay Pacific lounge and flight experience accessible to everyone via the usage of VR, especially to those who have not had a chance to fly on our airline,” shared Ma. She added, “While there have been some really great destination focused videos, we haven’t seen as many brands in the travel space fully embrace VR’s potential. It remains to be an area of experimentation yet comes with limitless creativity.”

Eriksson also acknowledged that VR is in its nascent stages. “Consumer VR has only been around for a year, so some may be a bit skeptical about trying out new technical solutions and prefer until someone else has trialed it. That’s a big mistake I think. We prefer to test for ourselves. First on a small scale and then scaling up if the results are positive,” she said. As generally is the case with finalising a budget for marketing, companies generally follow the “70/20/10 Rule” or even “90/9/1” (with majority going to what’s been done over the past few years; next focus on something that has just gone mainstream and last part for testing new concepts/ technology and don’t expect a major RoI). So it is interesting where travel brands fit in VR in their plans as of now.

Eriksson also mentioned that Ving sees this as an investment for improving the tour operator’s business. “We already have Customer Service available through Facebook.  Through the use of Facebook Spaces we can now provide an extra service that will help assist our customers during the Search and Inspiration phase of their customer journey,” she said.

Points to consider

·          Be clear with the objective:  Ma also added that some marketers tend to focus on current trends and focus on executing something just to stay trendy. “It’s important to think through why we want to execute something new and be clear about what goals we want to accomplish,” she said. “It’s important to clarify the purpose of creating VR content, crystallize the storyline for the video, ensure the content be enticing enough for the audience and strategize ways of promoting the video effectively. For example, in our case via events, advertising etc.”  

·          Keep it simple: Ma highlighted that ease of consumption and simplicity are key. “Embracing new technology is already a daunting task hence we want to make sure our audiences/ customers can consume our content easily. The VR ads we are using for our current Hong Kong campaign can be easily viewed on mobile and desktop environments,” she said. As for the sort of preparation that went in for this new initiative, Ma said, “In the beginning stages, we spent a lot of time working on creative concepts and storyboarding for the video to ensure we have a compelling story to tell. While we are excited about what VR can do to enhance our content, it’s important for us that the video should not be presented as an ad but rather an authentic story about two travellers flying on Cathay Pacific from San Francisco to Hong Kong.”

Eriksson shared that a major challenge lies in “creating content that looks and feels as ‘realistic’ as possible, especially with the added constraint of no ‘off the shelf’ technology being available yet that can handle this in a satisfactory enough manner.” But in a few years, it will be possible, she expects.

·          Being open to experimentation: Eriksson shared that the team, led by IT engineer and internal VR guru Jonas Carlson Almqvist, has been experimenting and producing 360-degree videos for years, with all available to view on Google Streetview. “We’re still exploring ways on how to now make the next step in 360-degree video as there is great potential here to display travel content in a truly inspiring way,” she said. “It would have been a much more challenging and expensive test to run without this (approach towards continuous testing helped),” she said.

·          Measurement: A way to measure is expand the reach, assess coverage in media etc. “We made press releases in different languages, recorded video material (both long and short videos) and then we posted the posts in our social media channels. You can also register on a Guided Tour in Ving’s VR World via a form. Through these activities we can measure, for example, involvement in social media, film views, how many articles are written about us, etc.,” shared Eriksson.

It is important to keep an eye on improvement. “Technology is constantly evolving and the way we experience 360-degree content today will not be the same way we experience VR media in the future,” concluded Eriksson. 

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