As Distribution Evolves, Agents Will Remain Key, Speakers Say

Despite direct sales, the rise of ancillary products, and the perceived threat of the New Distribution Capability, travel agents will continue to play a key role in airline distribution for the foreseeable future.

That was the consensus of executives who spoke at the UATP Airline Distribution Conference in Miami last week.

Should be rewarded
An Air Canada executive who was instrumental in developing the carrier’s merchandising strategy said that “of course” travel agents have a role to play in the sale of airlines’ ancillary products.

Moreover, agents “should be rewarded for increasing sales and revenue for the airline” – whether for sales of ancillary products or airline tickets, said Graham Wareham, senior director of distribution and consumer direct, adding: “There’s no difference.”

Neglected channel
Gianni Cataldo, a senior executive at a technology company that builds merchandising platforms for airlines, said, “We sit down with airlines and look at merchandising on a channel by channel basis.” But the agency channel is often neglected, said Cataldo, vice president and general manager for the Americas at Datalex.

“Ironically, the agency is the best opportunity for an upsell” for the airline, he said. “There is  definitely a role for the agency to be involved in this mix. Something that can be done easily by the agency might be a challenge for technology.”

Impact of NDC on agents
Norm Rose, president of Travel Tech Consulting, noted that some travel management companies are concerned that they will lose revenue if IATA’s NDC takes hold.

“We see some ridiculous things in the press about NDC,” he said. “All it is, is a standard.”

But for decades, the goal of TMCs has been to maintain GDS productivity, he said, “and the person with the best GDS skills was usually the best agent.”

That will change, he said.

“We’re going to see Nordstrom agents,” Rose said, referring to the department store that is famed for personalized service. “What’s more personalized than offering ancillary services that meet my needs?”

Watershed event
The light at the end of the tunnel, Rose said, is American’s new agreement with Travelport by which the companies will connect via their APIs.

“This is a watershed event, the biggest news in travel distribution,” he said. “I’m hopeful this means everyone will participate in this new world.”

To the airline audience, he added, “you can’t do this without some involvement with the [agency/GDS] channel. It’s going to be a multichannel world for some time.”