Later this week I’ll be in London speaking at the Flightglobal / Airline Business conference, which will bring together travel industry experts, customers and air service providers to discuss, share and debate new airline commercial models, retailing and merchandising. Over two days, the sessions will look at changing air service, retailing and merchandising strategies. Beyond the travel sector, perspectives from Tesco and Groupon will be interesting, as I firmly believe we in the airline industry should look to the retail sector for good practice in how to tailor offers, merchandise and drive increasing air services & revenues.
As for me, I’ll be participating as a panelist during a debate on day one (26 January) focused on the evolution of airline strategies. I’ll be talking about how we work with airlines to improve the air commercial model, retail, and indirect air distribution strategies. Travel is one of the biggest industries online and by unbundling the airline industry is currently undergoing a fundamental shift in the way it does business. So we should give credit where it is due: there is plenty of evidence of innovation in the travel industry.
While merchandising has been a success on airline.com, in the travel agency channel the verdict is still out. If airlines unbundle in order to create upsell opportunities, then it makes sense than an airline would want to make those upsell air services available in all possible sales channels to maximize their opportunity to sell. Right now, few ancillary services are sold by travel agencies but we are now starting to see some big airlines make their ancillary services available through the GDS, which opens up huge potential in terms of geographic markets and TMC / corporate bookings for airlines.
This has important implications for us in the GDS industry. We are replacing the traditional focus on air distribution, which is driven by efficiency, with a focus on retailing. We are thinking more about how to display an airline product to show not just the difference in price between two offers but why those differences exist – what does a consumer get for the higher-priced fare?
Increasingly we’re thinking of ourselves not as Global Distribution Systems but as Global Retailing Systems. Perhaps in five years’ time we will all be talking about the GRS.
For those who would like to register to attend new airline commercial models, retailing and merchandising please click here. Alternatively, watch this space as I’ll be blogging on the hot topics to emerge from the conference.