Delivering Ancillary Data Is a Tricky Business

If you spend an afternoon at Macy’s and make purchases in three departments, your credit card statement will show three transactions. Not so if you buy extra legroom, a blanket and a beer on a flight. Your credit card statement will show an undifferentiated lump purchase from the airline.

That’s just one of the issues surrounding unbundled fares that travel management companies and corporate travel departments are grappling with.

Macy’s operates on the retail model, explained Cyndi Hunter, director of global accounts at United Airlines. The airlines? They operate on a linear model. Changing that would require heavy lifting, she said.

Impact of ancillaries
In her role as co-chair of the Global Business Travel Association’s aviation committee, Hunter took a long hard look at how the airlines’ ancillary products are affecting the corporate travel market, she told the Saint Louis Business Travel Association last week.

At the group’s education day, she explained some of the complexities of delivering the data that travel management companies and corporate buyers need if they are to answer questions such as, “How much are we spending on air travel?” and “What exactly are we buying?”

Monumental task
The credit card statement seemed like a logical place to start, she said. But what looked like a simple matter of coming up with standardized formats to explain charges became a monumental task.

She explained that even if you could get the airlines to align their descriptors and codes – and get them to populate all the fields of a transaction – you still would have to go through the same process with the credit card company, the acquiring bank, the expense management company and every other entity that touches a transaction.

Industry efforts
Hunter noted that various other companies and groups have worked on ways to fit airline merchandising into the way the travel industry works today.

The Air Tariff Publishing Co., which distributes airlines’ fare data to GDSs, online agencies and other entities, has created an extensive menu of standards to define and describe what it calls “optional services,” and at least two dozen airlines have tested it.

In fact, airlines now can file their ancillary product information and fees with ATPCO. A product transaction can include a corporation’s contract code, so that if the company’s contract with an airline includes a discount for, say, a bag fee, the discount will be applied automatically.

But no airlines are filing their ancillary data.

ARC’s approach
The Airlines Reporting Corp. has developed Electronic Miscellaneous Documents (EMDs) that can be used to process ancillary product purchases associated with a particular flight (the EMD-A for meals, extra legroom, etc.) or standalone product purchases (the EMD-S for lounge access, for example).

The EMD has been ready to go since last fall. It has yet to process a single transaction.

The GDSs also have “worked really hard to allow airlines to sell their products through their systems,” Hunter said.

So what is the problem?
“The question is how the GDS will display the product for purchase,” Hunter said. In the end, she said, it all comes down to the commercial agreements between the airlines and the GDS.

If the airline doesn’t have an agreement with the GDS governing how the ancillary data is displayed and sold, the data feeds and EMDs are moot. For now, those two pieces of the puzzle are waiting in the wings.

Hunter ended on an upbeat note: Despite all the drama surrounding the current distribution battle, “there has been some positive action on that front.”