How the airline industry is planning to get more social with its customers
You can think of IATA’s proposed new way of selling airline services to passengers as something akin to the difference between the way the first generation of computer buffs used linear DOS commands while today’s users access GUI interfaces or tap their way through mobile devices. There’s a danger, though, that airlines could mishandle passengers’ personal information.
It comes down to this: Are passengers going to want to hand over their Facebook and Twitter data to build social media profiles that would enable airlines to sell them personalized offers for fast-lane security, Wi-Fi, lie-flat seats, or chauffeur service from the airport?
IATA, the global airline trade association, is in full-throttle promotional mode over the next couple of days, touting its proposed New Distribution Capability (NDC) during the group’s 69th Annual General Meeting in Cape Town, South Africa.
Delegates reaffirmed their support for NDC, and IATA released a video [embedded below] explaining what the sometimes-mysterious NDC actually is.
Basically, NDC is a new XML technology standard that in theory would enable airlines to sell a fuller array of ancillary services through large travel management companies such as American Express, Carlson Wagonlit Travel or BCD Travel, for example.
Instead of having to build complicated workarounds to access limited information about fees or premier seats, under the new NDC both airlines and travel management companies would be able to send and receive this product and service information easier, and the descriptions would be richer, with images and much more detail.
Some of the controversy comes in on two fronts:
- This new technology standard could help establish more direct relationships between large travel agencies and airlines, and thereby diminish the roles of middlemen such as Sabre, Travelport, and Amadeus.
- Although travelers could still shop for flights “anonymously” and would then forego the option to receive detailed information about ancillary services such as premier seats, seat upgrades and a slew of new products, others would choose to provide personal information, including social media profiles, to the airlines in order to access “full product information.” And, the airlines would have a marketing field day with this, accelerating their several-years-long drive to market on a personalized basis to traveler, even beyond their frequent flyer information.
IATA plans on overturning the existing way that airlines, global distribution systems, and travel agencies work with one another, and the manner in which travelers shop for flights and other airline services.
In that regard, IATA says “members confirmed that airlines and other industry players will be free to decide whether or not to adopt NDC to support some or all of their distribution needs, and that IATA would continue to support the existing legacy standard while demand for it exists.”
IATA hopes that demand for the status quo way of doing things won’t last for long.
Here’s IATA’ video outlining what it believes the plan means for airlines, travel agencies and passengers: