There has been serious talk of ‘offer and order management’ in the airline industry for some years now. In fact, this was a key topic for delegates at the IATA World Financial & Passenger Symposium in Chicago late last year, where it became clear that offer/order was finally gathering pace.
But for many of online travel agencies (OTAs), tour operators and retail travel agents selling air products, the concept is still largely unknown.
So what is offer and order management exactly? Put simply, this emerging technology method of selling air travel products – and perhaps one day other travel products like accommodation – is essentially based on the principles of good and modern retailing. The result? Once implemented, offer-order enables airlines to create and distribute personalised offers to travellers.
Why is that important to distributors and sellers of airline products? As industry pressure to adopt offer-order grows, we asked B2B travel technology industry experts how they think this will change travel the travel landscape and what you can expect in the future.
Vibe, a provider of booking & reservation technology to online travel sellers, thinks that offer-order will allow new players to enter the travel space, perhaps through new retailing partnerships.
“Travellers currently face a limited choice when booking air products, alongside a complex and time-consuming booking process that often takes place across multiple channels,” said Martin Eade, co-founder of Vibe.
“Offer order will take these frustrations away by presenting the traveller with a range of relevant, easy-to-book, tailored travel options. Taking away complexity for travellers will likely result in better conversion rates, and will open up doors for airlines to offer new services, and therefore for new players – B2C websites perhaps not selling travel products right now – to enter the market.”
Nonetheless, Maxim Sevastianov, founder and CEO of Trava, a specialist in post-booking technology for online travel sellers, sees a big opportunity for existing retail players. “Today, airlines struggle to gain useful insights into their travellers’ individual preferences and therefore can’t offer accurately personalised products. In parallel, airlines have the added difficulty of managing complex partnerships, as much of the technology they are using to do so is outdated or siloed.
“Adopting the principles of retail, an offer-order environment is likely to open a whole new world of ancillary revenue for airlines that travel distributors and intermediaries will find very valuable both in terms of additional revenues, but just more generally in keeping clients happy or increasing sales conversions.”
Artificial intelligence could be the boost the industry needs to make offer-order a reality, according to Sergio Sánchez, CIO of PriceTravel, one of Latin America’s biggest B2B and B2C sellers of travel.“Soon, air travellers will enjoy complete transparency across all air products and services, even if they’ve booked across multiple channels, thanks to AI automating and compiling this information. Everything will be visible in one place for the passenger, and there will soon be no need to keep track of multiple reference numbers for each trip.
“This transition has long been spoken about, but has remained a pipe-dream in part because of technical limitations. However, thanks to the evolving capabilities of artificial intelligence, 2024 may be the year we start to see this actually take shape.”
Airnguru, a provider of fare management, pricing intelligence and price automation solutions for airlines, is enthusiastic about the potential of offer/order to redefine air travel retailing. CEO Sergio Mendoza explains: “The true driving force behind this change will be the widespread adoption of Machine Learning and Artificial Intelligence. For airlines, the final retailing vision revolves around the ability to create dynamic, personalised offers for travellers. However, this requires the implementation of robust Machine Learning models continuously trained on massive, unbiased data, capable of interpreting the desires of consumers and forecasting their willingness to pay, and recommending the appropriate set of products at the appropriate set of prices.
“2024-2025 could mark a significant turning point in this transformation, with airlines increasingly harnessing the power of ML and AI to adjust their product offer and prices in real-time, based on supply, demand, and shopping data, as well as various contextual variables.”
As a final thought, Gareth Matthews, CMO at global travel distribution provider, Didatravel – which in recent years has begun selling flights as well as accommodation – reminds us that we’ve still some way to go.
“This will be a watershed moment for airline distribution, and one that is very much welcomed by online travel sellers everywhere, but we must remember that we’ve been hearing about similar plans for over a decade now. Some airlines are slowly integrating such technology, but it is still far from standard practice.
In other words, if you’re an OTA or tour operator in a source market dominated by one or two airlines and they don’t have a plan for this, basically it might as well not exist – and that’s the case in many markets still. Hopefully this will change over time, but don’t bet the future of your business on that.”