Redefining airline retail sales for agents and planners
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What is the best way to sell consumers and business travelers the airline experience? Where do the best sales techniques intersect with the most efficient merchandising tools? Furthermore, how can travel agents, corporate travel planners and other travel buyers learn more about the newest airline merchandising technology? With IATA’s controversial NDC project as backdrop, Tnooz and Travelport present a FREE webinar to answer these and more questions. Travelport and EasyJet led a discussion of Travelport’s Merchandising platform and the opportunities it presents airlines, agents and planners. The webinar investigates: Transformation of indirect distribution into a contemporary retail channel An airline’s delivery of content, ancillaries, product descriptions and fare families Merchandising airline product through visually appealing tools rather than codes and commands Panelists: Andrew Hodges, director of sales, distribution and business, EasyJet Derek Sharp, managing director for global distribution sales and services, Travelport
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Redefining airline retail sales for agents and planners
- 1. Redefining Airline Retail Sales for Travel Agents Webinar 23 July 2013
- 2. K Kevin May Editor & Moderator Gene Quinn CEO & Producer Your hosts
- 3. K Derek Sharp Travelport Managing Director Global Distribution Sales & Services Andrew Hodges easyJet Director of Sales, Distribution & Business Your panelists
- 4. Derek Sharp, Travelport 23rd July 2013
- 5. Different paths to growth, ancillaries and consumer needs 46 240
- 6. New players, skies opening up, agents must ‘sell’ 85% of agents want to sell ancillaries
- 7. Airlines want to differentiate: agents need the knowledge
- 9. airline.com Industry centric Common to all airlines Airlines have choice: no technology restrictions Flexible Dynamic Customer centric Unique to your airline Corporations OTAs Travel Agencies Social Media Web Airline Agent Mobile API Airlines Choose The Right Approach For Them Industry Standards Consistencyforconsumersacrossallchannels
- 10. Travelport Merchandising Platform Right information, at the right time: across all points of sale A common workflow: across all points of sale Sell all content: across all points of sale
- 11. TRAVELPORT MERCHANDISING PLATFORM: Aggregated Shopping f
- 12. f TRAVELPORT MERCHANDISING PLATFORM: Ancillary Services
- 13. TRAVELPORT MERCHANDISING PLATFORM: Rich Content & Branding f
- 15. Enable agents to access all airline content in their normal workflow in anyway that they choose Enable airlines to distribute their products in a new dynamic way
- 17. Key easyJet facts 5.3 £bn market cap*. 61 FTSE 100 rank* 22 Bases 211 Aircraft (Airbus A319/320) 640 Routes * As at 18th July 2013 60 m passengers pa 10 m business passengers pa
- 18. Europe’s no. 1 air travel network
- 19. Leading punctuality Initiatives launched to drive operational performance and minimise disruption included: • The easyJet turn project • On-going twice daily operational calls • Investment in easyJet’s operations control centre
- 20. Some recent product improvements Allocated seating Fast track security for flexi customers
- 21. 2121 Flexible Fares £100 more £ 50-100 more £ 20-50 more £ 0-20 more £ 0-20 cheaper £ 20-50 cheaper £ 50-100 cheaper £100+ cheaper Standard Fares £100 more £ 50-100 more £ 20-50 more £ 0-20 more £ 0-20 cheaper £ 20-50 cheaper £ 50-100 cheaper £100+ cheaper We are cheaper than our competitors*: • standard fares - on 80% of occasions (by more than £100 on 55% of flights) • flexible fares - on 92% of occasions (by more than £100 on 65% of flights) * Source: independent market survey, 2012 easyJet easyJet Relentless focus on delivering value
- 22. Evolution of our Distribution strategy easyJet & Travelport • Launched Jan 2008. All agents worldwide • Challenge now to unlock full potential Direct Sales: Contact Centre Direct Sales: Web Multi channel
- 23. Benefits of booking easyJet via GDS For easyJet: • strategy is to carry more, higher yielding business passengers • GDS is the preferred channel for managed corporate travel • GDS shopping and booking process for easyJet fares should be the same as booking high fare airlines For TMCs/corporates: • standard booking processes improve operational efficiency • simpler management of bookings • easier access to lower fares
- 24. 2424 Partnership with TMCs & Corporates • Standard approach, tailored & managed by market • Targeted incentives that drive incremental yield, not volume • Range of products & channels to suit different needs • Designed to make business travel easier and more affordable
- 26. Questions ?
- 27. K Q & A
- 28. K Replay and presentation from today’s webinar will be available at www.tnooz.com Please send your questions to kevin@tnooz.com
- 29. K Thank you!
Editor's Notes
- Narrative here: lots happening in the industry that merits discussion and analysis but here are some specific examples of note. Whatever airline model, however you want to define them, from wherever they fly, all are looking at different ways to grow/profit/reach new consumers/ – they need to be supported in their choices.Airlines are pursuing different strategies for growth: Etihad v Emirates – good example. Etihad’s “equity alliances” (= JVs and partnerships): Korean Air and Etihad Airways signed (16-Jul-2013) a new codeshare agreementbrings to 46 the number of codeshares operated by Etihad. Other examples:Air Berlin - 29% stake. Air Seychelles - 40% stake.Etihad has subsequently taken smaller stakes in Virgin Australia and Aer Lingus, Jat Airways and India's Jet Airways. Etihad Airlines witnessed earnings boost by 8% in the second quarter in 2013, with a total of USD921 million revenue for the three months to end of June , which is USD66 million more than revenues reported for the same period last year..Emirates (new planes, more routes): building up its fleet and number of routes as it seeks to establish Dubai as a long-haul travel hub and win passengers from European carriers. In top 10 in the world by passenger numbers, has announced the addition of 9 new routes so far this year. New destinations include Rio de Janeiro, Buenos Aires and Barcelona2. Other airlines focused on ancillaries sales to drive profitDelta has rolled out economy comfort seats through Travelport worldwide (has announced Amadeus but not deployed). Spirit beginning in August, charge an additional fee of up to $45 for any bags placed in overhead bins (30 if paid in advance online), At the same time, Spirit will lower fees for checked luggage. Spirit Airline members will pay $15 for their first and second bags if they pay online, instead of the $19 and $25 that was previously charged. Non-members, however, will pay more: The first bag is $25 online and $45 at the airport; $30 for the second bag.3. New airplanes/new configurations - BA spends around £9 million on new interiors for A380s and 787s – for that investment (never mind the actual aircraft!) agents MUST be able to ‘sell’ new configurations and next generation interiors to consumers4. And consumers? They want to be recognised. Their FF status should be working across all channels!OTHER off slide mention:50% of the Japanese market will be low cost by 2015
- Talking of low cost: the boom continues outside of Asia as OAG point outt regarding EuropeThe new players are causing established players to react differently. Qantas is no longer the de-facto domestic leader, Virgin Australia, by some calculations , has 51% of share. Competing with newer players , such as LCCs , requires fast and flexible changes to fares and offers and schedules. Dynamic fare filing using API-based technologies is allowing some traditional airlines to , in effect, run parallel business models. This will work as long as all technologies inter-operate. This is now happening. As we will explain.There are 2 very clear conclusions to drawAncillaries are vital Travel agents themselves recognise this. Travelport research concluded that 85%* of agents interviewed want the ability to sell ancillaries. We also know this to be true in corporate travel space: 90% of corporate travel managers use travel agencies to manage business travel for employees. Out of these travel managers, access to travel content in an aggregated manner is confirmed as their top priority.** *interviews conducted by Travelport in 2012 with 652 agency owners and managers **interviews conducted by Travelport in November 2012 with 33 global corporations including Microsoft, Nestle, and Citygroup2) They are embedded in airline plans and are here to stay. they are set to drive revenues to over 45 billion by 2015 They are recognised as crucial by even the most heavily regulated skies – India’s announcement in May : In a move to bring Indian air fare structures in line with most of the world, the Directorate General of Civil Aviation (DGCA) is allowing carriers to unbundle their fares and services.
- For agents , the world of ancillaries is regarded as complex. Hard to know what airline offers what optional services on what routes and for what price.BAGS – different policies:Different weight limits per airline:23kg for BA30kg for EtihadSeats are all different.Inside of plane is new KLM - KLM unveils first fully-flat business class seat (in March)2 things need to happen1) airlines must be able to offer their ancillaries, and pursue growth and differentiate themselves and build brand equity across all channels.2) technology distributors must introduce the technology to allow this to happen for the travel agency community in way that is as simple and intuitive as possible..
- Message to airlines: “Retailing and marketing your brand your way” – providing choice for airlines. Enabling airlines to distribute their products in a new dynamic way.Message across agency spectrum: “Unrivalled content. Your workflow, your way” - Enable agents to access all airline content in their normal workflow in anyway that they choose
- 1) TOP LEFT BLUE BOX: When airlines deliver products through the channels that they control, such as their website, they have the flexibility to manage this delivery intricately and to act as retailers.2) BOTTOM LEFT BLUE BOX: This level of dynamic control is less obvious and less flexible – when products are delivered through industry standards. - These standards fulfil a purpose and are valuable. After all, according to IATA statistics 60% of airline tickets (by value. i.e the ones that generate most yield) are sold through agency network. - They have allowed agents to manage complex itineraries and airlines to interline and so forth. 3) THE API LINE TO TRAVELPORT: What is now revolutionary and unique to Travelport is that we are now able to give airlines the control and the retailing capacity through channels that they traditionally have less control of - the indirect channels. API and web-based data transfers (in themselves not new) allow airlines to communicate to GDSs in way that is akin to a self-managed channel and it is also MERGED along side Industry Standards. An agent accesses all airline information regardless of the technology used by that airline. And can book all products in a way that is inclusive of the process they are so used to. The consumer gets an experience and consistency of product through the agent that he recognises from any other interaction he may have had through other channels.This is opening the door to multichannel retail.
- 3 components: value statementsTravelport Aggregated ShoppingFlexible connectivity - airlines can distribute content through Industry Standards-filed, API or hybrid - with all content shown in a single display. Meets traveller demand in respect of regional and low-cost airline growth.It enables agents to shop for LCC and traditional airline content in the same screen, in the normal workflow, using the same commands.It enables easy price comparison of all airlinesIt provides enhanced content as it enables LCCs to distribute their content through an APITravelport Ancillary servicesTravelport’s technology enables airlines to easily distribute their ancillaries however they choose - via either ATPCo or API - making more content available.Airline ancillaries are delivered to all points of sale and are seamlessly integrated within an agent’s normal workflow.Customer-centric selling - with personalized ancillary offers such as a free bag or seat to Gold frequent flyers.No need to look outside the GDS to offer the full range of products from an airline.Travelport’s technology enables airlines to easily distribute their ancillaries making more content available for agents.Travelport Rich Content and BrandingEnables airlines to consistently brand and market themselves. Product and sales messages enable airlines to sell themselves as opposed to just being on the shelf.Provides ‘rich’ information at the point of sale, with images and sales information ensuring the agent is able to confidently sell an airline’s products.End customers receive consistent content, branding and positioning across all channels.It provides information on a particular flight highlighting all the services, free and ‘paid for’, that an airline offers.It enables agents to easily assimilate and quickly compare the different airline offerings.
- Aggregated Shop: Manchester International to CopenhagenLow cost along side full service – same workflow – no jumping out to .coms or broken workflows for agents: easyJet/SAS/KLM/SwissYY = multiple carriers
- Left hand side shows ancillaries/optional services integrated into the workflow – here baggage and sports equipment for easyJetRight show seating product and ability to choose through a seat mapAll ancillaries on Travelport and bookable
- Smartpoint Prototype:Replication of what we expect to see on a website. To be seen by agents, airline products ‘recognised’ and sold to consumers.
- Delta: API connectivity for seats BA: API connectivity for seats Air France/KLM: Industry Standard seats and bagsNorwegian: Aggregated ShoppingEasyjet: Aggregated shoppingJet2 :Aggregated shoppingAegean: Industry Standard bagsAlitalia: Industry Standard Paid Bags / Sports Equipment / Fast Track / Lounge AccessQantas: Industry Standard seatsAir New Zealand; bags
- Introduce easyJet…