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).
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