NDCTechnology

Decoding NDC’s Business ROI: For Airline & OTA Business owners

What is NDC in the Travel Industry?

NDC, which stands for New Distribution Capability, represents an air travel industry standard crafted by the International Air Transport Association (IATA) with the purpose of modernizing and elevating airline distribution methods. It consists of a series of XML-based messaging standards that facilitate airlines in delivering comprehensive content and personalized deals directly to various distribution partners, including travel agents and online travel agencies (OTAs).

What is NDC Fare? 

The significance of NDC lies in its ability to extend airline offerings beyond traditional fare and schedule information.  It encompasses ancillary services such as seat selection, baggage options, and direct connect aggregator in-flight amenities, all presented in a transparent and customer-centric manner. Ultimately, NDC strives to offer travelers a seamless shopping experience while granting airlines greater control over their product offerings and direct connect aggregator options.

NDC: Transforming Travel Distribution in the Modern Era

The air travel industry has experienced a substantial transformation thanks to the emergence of the NDC ticketing system. Traditional distribution channels, typified by Global Distribution Systems (GDSs), have been constrained by their limited flexibility, personalization capabilities, and the ability to offer additional services. NDC ticketing system addresses these limitations by empowering airlines to establish direct connections with travel sellers, resulting in a more tailored and all-encompassing travel experience.

NDC travel empowers airlines to leverage their wealth of content and customize their offerings based on individual customer preferences, paving the way for precise marketing strategies and opportunities for upselling. By embracing NDC, airlines can set themselves apart in a fiercely competitive market, enhance overall customer satisfaction, and create new streams of revenue.

For Online Travel Agencies (OTAs), the integration of NDC conversion tool opens up a realm of new possibilities. It grants them direct access to real-time offers and content directly from airlines, allowing them to furnish their customers with highly accurate and up-to-date information. This integration also facilitates the development of inventive booking experiences, dynamic packaging, and personalized recommendations, all of which contribute to elevated conversion rates and enhanced customer loyalty.

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Challenges Faced by Airlines & Major OTAs

Leading airlines and OTAs encounter several challenges in their operations:

1. Dependence on GDSs

Major OTAs have increasingly relied on Global Distribution Systems (GDSs) for indirect API integration, given the efficiency of this established distribution network. However, this reliance can restrict their ability to offer personalized content and robust marketing platforms for airline services.

2. Handling High Search Volumes

A significant hurdle with NDC travel is efficiently managing the extensive volume of searches and routing them to the appropriate airlines. If each search triggers multiple calls to various airline APIs, it can result in an expensive, resource-intensive, and time-consuming process.

3. Demonstrating NDC’s Value Proposition

Although NDC conversion tool integration presents numerous benefits for airlines, its immediate value in comparison to the advantages of GDS and Destination Management Companies (DMCs) may not be readily apparent. GDSs, in particular, may be hesitant to transition to NDC airlines, given their established systems and perceived advantages.

Importance of Aligning with Business Goals

When assessing innovative technologies like NDC ticketing system, business leaders should consider how these align with their overarching business objectives. For OTAs, NDC can offer solutions to critical challenges, such as heightened competition, escalating expenses, and evolving customer demands. Specifically, NDC can empower OTAs to:

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1. Reduce Dependence on GDSs

NDC enables OTAs to circumvent GDSs and establish direct connections with NDC airlines. This approach can help OTAs minimize distribution costs and gain greater control over their distribution strategies.

2. Expand Product and Service Offerings

By leveraging NDC travel, NDC airlines can provide more personalized and distinctive products and services. OTAs can then pass these benefits on to their customers, enhancing their ability to attract and retain clients.

3. Enhance the Customer Experience

NDC airlines equips OTAs with richer information about airline offerings. For instance, OTAs can utilize NDC to furnish customers with real-time pricing, availability data, and tailored offers, thereby elevating the overall customer experience.

Incorporating NDC API into their operations allows OTAs to navigate these challenges effectively and realize their strategic goals.

NDC’s Business Potential: Key Value Propositions for Airlines and OTAs

New Distribution Capability (NDC) presents numerous value propositions for both airlines and Online Travel Agencies (OTAs). These key areas highlight the substantial benefits that NDC integration can bring to the air travel industry:

1. Elevating Content and Product Offerings

Tailored Fare Bundles: NDC conversion tool empowers airlines and OTAs to craft personalized fare bundles, catering to individual traveler preferences. This customization allows passengers to select services and amenities aligned with their needs, resulting in a more gratifying travel experience.

Enriched Media and Ancillary Services: NDC API equips airlines to showcase their unique offerings through immersive media content and an expanded array of ancillary services, including seat upgrades, additional baggage options, and in-flight Wi-Fi. This not only enhances the overall passenger experience but also opens new revenue streams for airlines.

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2. Enhancing Customer Satisfaction and Loyalty

Targeted Offers Based on Traveler Insights: NDC ticketing system enables airlines and OTAs to gather and leverage customer data effectively, facilitating the delivery of tailored offers and recommendations grounded in traveler preferences. This high level of personalization significantly boosts customer satisfaction and fosters loyalty.

Streamlined Booking with Comprehensive Data: NDC streamlines the booking process by providing real-time access to comprehensive inventory, pricing, and availability information. This simplification results in higher conversion rates and heightened customer contentment.

Consistency Across Platforms: NDC airlines and OTAs can ensure a consistent and seamless traveler experience across various platforms, spanning websites, mobile applications, and third-party channels. This uniformity in customer interactions builds trust and nurtures loyalty.

3. Fueling Business Growth and Profitability

Enhanced Conversion Rates via Targeted Content: NDC’s personalized and relevant content offerings assist airlines and OTAs in boosting conversion rates, translating into increased bookings, revenue, and profitability.

Exploiting New Revenue Streams with Ancillary Services: NDC travel grants airlines the ability to diversify their revenue streams by offering an array of ancillary services, such as upgraded seating, additional luggage options, and in-flight connectivity.

Efficiency in Operations through Direct Integration: NDC airlines can streamline operational costs by directly integrating with travel sellers, reducing reliance on third-party distribution channels and associated fees.

Dynamic Pricing Agility: NDC travel equips airlines with dynamic pricing strategies that adapt offers to real-time market demand and traveler preferences. This pricing flexibility empowers airlines to optimize revenue and profitability.

NDC’s compelling value proposition is a game-changer for the air travel industry, including both airlines and OTAs. From enriched content and personalized experiences to heightened customer loyalty and enhanced profitability, NDC integration can unleash a realm of possibilities for decision-makers. OneClick’s NDC integration services are poised to assist companies in harnessing these benefits and realizing their strategic objectives.

Risks of Not Adopting NDC

In the growingly dynamic scenario, the adoption of New Distribution Capability (NDC) is progressively gaining paramount importance for both airlines and Online Travel Agencies (OTAs). Failing to embrace NDC entails several risks that can significantly affect a company’s financial health.

Forgoing Lucrative Revenue Streams

Perhaps the most substantial risk of eschewing NDC adoption lies in missing out on lucrative revenue streams. NDC empowers airlines to deliver highly personalized and comprehensive travel experiences, encompassing ancillary services and supplementary offerings. Neglecting the NDC natural market means airlines may be unable to offer the same degree of customization, resulting in overlooked opportunities for upselling and cross-selling.

Vulnerability to Technological Obsolescence

Another peril of shunning NDC adoption is the vulnerability to technological obsolescence. With a growing number of airlines and OTAs integrating NDC, those who remain aloof run the risk of lagging behind in NDC natural market in terms of technology and innovation. This can lead to a decline in market share and diminished competitiveness.

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Eroding Customer Loyalty Due to Subpar Experiences

Ultimately, the failure to adopt NDC ticketing system can erode customer loyalty due to subpar travel experiences. Modern travelers seek personalized and seamless interactions when booking their journeys. In the absence of NDC, airlines and OTAs may fall short of meeting customer expectations for personalization, leading to dissatisfaction and a loss of customer loyalty.

In summation, the risks associated with neglecting NDC travel adoption are substantial and possess the potential for long-lasting repercussions on a company’s success. Embracing NDC allows airlines and OTAs to unlock fresh revenue streams, maintain technological relevance, and deliver the seamless experiences that contemporary travelers demand. OneClick’s NDC integration-related services are tailored to assist companies in navigating the intricacies of NDC adoption and maximizing its myriad benefits.

Effectively Conveying NDC’s Value to Decision-Makers in Airlines and OTAs

For decision-makers in the airline and major Online Travel Agency (OTA) sectors, grasping the true worth of New Distribution Capability (NDC) is paramount to harnessing its full potential for their businesses. Here are essential talking points and strategies to articulate the value of NDC

1. Crafting a Persuasive Value Proposition

A compelling value proposition serves as the linchpin for conveying the merits of NDC to decision-makers. It should possess qualities of allure, exclusivity, credibility, and clarity, underscoring NDC integration’s distinctive advantages. It should elucidate how NDC can empower airlines and OTAs to attract and convert more customers, bolster customer loyalty, command premium prices, and outshine competitors.

2. Key Talking Points for Business Leaders

Revenue Growth Potential: NDC travel integration unfurls the doors to novel revenue streams for airlines and OTAs, with an estimated value creation of approximately $40 billion by 2030. This constitutes around 4% of industry revenues or $7 per passenger. This growth trajectory is propelled by additional revenues and heightened cost efficiency.

Competitive Edge: The adoption of NDC ticketing system equips airlines and OTAs with the tools to differentiate themselves from rivals, offering personalized, streamlined, and innovative booking experiences. This strategic move positions them to capture a larger market share and maintain a leading position in an ever-evolving industry landscape.

Enhanced Customer Loyalty: NDC integration empowers airlines and OTAs to deliver tailored content, real-time updates, and efficient communication, culminating in heightened customer satisfaction and loyalty. Contented customers are more inclined to choose the same airline or OTA for future bookings, fostering enduring revenue growth.

Data-Driven Insights and Analytics: NDC integration enables airlines and OTAs to amass and process rich NDC data pertaining to traveler preferences, historical behaviors, and selections of ancillary services. This treasure trove of NDC data can be harnessed to extract invaluable insights into customer needs, fine-tune pricing strategies, and customize offerings for individual travelers, ultimately boosting revenue and elevating customer satisfaction.

Demonstrating Tangible ROI (Return on Investment): To effectively convey the value of NDC, decision-makers must witness a clear return on investment. This can be elucidated through comprehensive case studies, success narratives, and NDC data-backed analysis, illustrating how NDC integration has translated into tangible business benefits for other airlines and OTAs.

Effective communication of NDC’s value is pivotal in realizing its potential for airlines and OTAs. By artfully constructing a compelling value proposition, accentuating key talking points, harnessing data-driven insights, and substantiating ROI, decision-makers can make informed choices regarding NDC adoption, thereby optimizing its advantages for their enterprises. 

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Practical Steps to Initiate NDC Integration

The process of initiating NDC integration can seem daunting, but it becomes more manageable with a strategic approach. Here are practical steps for airlines and OTAs to ensure a smooth transition

Assess Your Current Infrastructure

Start by evaluating your existing technological infrastructure. Understand your systems, processes, and NDC data architecture to identify gaps and limitations. This assessment forms the foundation for your NDC integration plan.

Select the Right Technology Partners

Choosing the right technology partners is critical. Seek providers with expertise in NDC who can offer the necessary tools, support, and industry-specific insights. Customized solutions tailored to your unique needs are key to success.

Prepare and Train Your Teams

NDC integration involves significant process and workflow changes. Prepare your teams by providing comprehensive training on the new technology, tools, and processes. Ensure they grasp the benefits of NDC and its impact on their roles.

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In conclusion, a well-planned approach to initiating NDC integration, including infrastructure assessment, strategic partnerships, and team preparation, is essential for success. OneClick’s NDC integration-related services can guide your company through this process, helping you realize the full potential of NDC adoption.

Addressing Common Concerns about NDC

While the NDC ticketing system presents numerous advantages for airlines and OTAs, decision-makers often harbor common concerns regarding the integration process. Here, we address these concerns and offer strategies to mitigate them:

Tackling the Integration Challenge

Transitioning to NDC can appear complex, but with a trusted technology ally like OneClick, the journey becomes streamlined. We ensure you smoothly embrace the NDC landscape, making the transition comfortable and efficient.

Balancing the Books – Costs vs. ROI

The investment in NDC might raise eyebrows for those at the helm, pondering about its tangible returns. It’s essential to emphasize the doors NDC opens – from surging revenue avenues and operational efficiencies to bolstering customer loyalty. This paints a promising picture of ROI in the NDC landscape.

The GDS Equation

Some airlines and OTAs might be on the fence, thinking about the implications of NDC on their ongoing dance with GDSs. Rather than viewing NDC as a disruptor, it’s more apt to see it as an enhancer – adding new revenue channels and giving a competitive edge, all while co-existing with the advantages of GDS.

On the Fence about Standardization

A handful of executives might be playing the waiting game, speculating on NDC’s industry standardization and its universal adoption. With many industry bigwigs already waving the NDC flag and more joining the parade, it’s evident that the NDC wave is more than just a fleeting trend. Embracing NDC now can position airlines and OTAs at the forefront of this industry evolution.

Overcoming challenges in the NDC integration process

Data Privacy and Security

Ensuring NDC data privacy and security, particularly in complying with regulations like GDPR, is paramount during NDC integration. OneClick, a trusted technology partner, emphasizes robust data protection and regulatory adherence to secure sensitive information.

Integration and Implementation Challenges

Steering challenges such as handling extensive search volumes and aligning industry logistics are common in NDC integration. OneClick’s NDC expertise tackles these obstacles through streamlined search processes, seamless NDC API integration, and United Airlines travel agent support in forging commercial agreements.

Cost Considerations

While NDC integration may entail initial expenses, the long-term benefits far outweigh them. These advantages encompass increased revenue, cost efficiency, and enhanced customer loyalty. OneClick collaborates with airlines and OTAs to devise cost-effective integration plans and substantiates ROI through data-driven analyses and comprehensive case studies.

NDC integration indeed presents challenges, but OneClick offers adept solutions through a range of services and a phased implementation approach. Our seasoned NDC experts assist in safeguarding data, integrating NDC into existing systems, managing complexity, and mitigating implementation costs. Reach out to explore how OneClick can effectively facilitate your NDC implementation.

Conclusion: Future-Proofing Your Business with NDC

New Distribution Capability (NDC) represents the future of airline distribution and is the key to success in the digital era. As an accredited NDC integrator, OneClick can become your trusted partner in swiftly and efficiently implementing NDC. Our seasoned team of NDC experts guides businesses through every phase of implementation, offering consulting, advisory, development, and testing services.

By collaborating with OneClick, businesses can position themselves ahead of the digital transformation curve, embracing change for sustained resilience. Here’s a glimpse of what partnering with OneClick on the NDC front means:

1. Diversify and amplify revenue streams, catering to broader audiences and honing pricing dynamism.

2. Secure that elusive edge by presenting unique, bespoke offerings to your clientele.

3. Foster an undying allegiance from customers through a travel experience that’s both seamless and memorable.

4. Leverage sharp, data-backed insights, illuminating both customer preferences and operational nuances.

In conclusion, NDC offers a potent standard that unlocks numerous benefits for the air travel industry. OneClick simplifies NDC integration, enabling businesses to reap the rewards of this innovative standard.

Business leaders keen on exploring OneClick’s NDC implementation solutions are encouraged to reach out. We are eager to discuss your unique requirements and formulate a tailored NDC plan. Contact us today for a fruitful NDC journey.

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