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Collaboration, personalization and creating value with your distribution strategy

Distribution within the airline industry always was and continues to be a complex topic involving many different players. This includes airlines, travel agents, other intermediaries, metasearch engines and, as more recent entrants, tech giants and native digital companies with high retail expertise.

To survive in this environment the focus for most airlines is on personalization of their offers. However, this is only achievable if the offer is more than a commodity. Collaboration and data exchange among the players, especially a data loop back to the airline must be enabled. 

IATA’s NDC (New Distribution Capability) can be mentioned here as a key enabler, since it is “helping airlines and agencies shift travelers flight purchase decision from commodity to a more value-focused process”.  This includes capabilities to better present (personalize) and learn (gather data) about the own offer.

Nevertheless, the mindset to collaborate becomes key for all players involved, in order to offer the customer an improved and consistent retail experience on any chosen channel, by addressing their shift in behavior now and in the future. Only this way the customer will have a frictionless interaction with all channels and players. 

This customer-centric approach must be the goal for any industry player with the target to maximize the value of the product offered to the customer and to optimize the own revenue streams and reduce costs. 

The COVID-19 pandemic has influenced and accelerated the need to adapt the distribution strategy towards a more collaborative model. Customers now more than ever before are highly influenced in their purchasing decision by factors like flexibility, transparency and availability of information regarding regulations and restrictions. Data about what they need and choose becomes more important than ever before.

Information sharing and data exchange through collaboration as well as communication with all involved parties is key to success, now more than ever

Read the full article here

The author, Laura Lusche, is an expert in the Sales and Revenue Management Solution Group

Further information about Lufthansa Consulting's Pricing and Revenue Management Services 

Related articles:

The new normal customer: New decision criteria determine how airlines can adapt their revenue management, sales and distribution

How digital solutions, services and technologies help organizations becomemore flexible and improve the travel experience for passengers

Podcast: Rethinking the basis for revenue management and pricing

Further insights from Lufthansa Consulting’s aviation experts are available here