Last week, T2RL virtually held its annual conference, PSS2021: Opportunities for Recovery in Airline Technology & Distribution. Kambr Media was there covering the event, viewing the two days of content.

Although there was a variety of formats, topics and speakers spanning airlines and tech providers, five key themes did emerge. We’ll take you through them one by one.  

Freedom & Flexibility from Tech Providers

Given the scope of the event there was naturally a lot of chatter around commercial aviation technology providers.

Along with that was a unified message for vendors to offer airlines more freedom and flexibility both in terms of the product itself and how support, infrastructure and onboarding was executed.  

“Flexibility is also something that we needed from the suppliers. The products on the market in the airline industry we're known to be something you cannot [Implement] so quickly, that it takes time, complexity and so on,” said Pedrag Todorović, CEO, Air Montenegro.

“I think these new modern flexible solutions will be something that airlines are looking for. There will definitely be new airlines and they will be looking for new quick, flexible solutions rather than starting operations from scratch or using something which is hard to implement.”

By focusing on core areas of the business and leveraging flexible software, Air Montenegro was able to launch in a matter of months.  

“I think these new modern flexible solutions will be something that airlines are looking for. There will definitely be new airlines and they will be looking for new quick, flexible solutions rather than starting operations from scratch or using something which is hard to implement.”

Similarly, Bamboo Airways was able to move quickly with a small team thanks to the support of its technology providers. The airline started selling tickets just four days before flights commenced.  

The Need for Agility, Adaptability & Efficiency

This leads directly into the next topic. Because of fluctuating demand caused by the COVID-19 pandemic, airlines had to adapt to a newer more agile way of working.  

“Our domestic demand environment fluctuated between 60-70% and 10% of pre-COVID in the span of 48 hours,” said David Emerson, Chief Commercial Officer, Virgin Australia. “As you can imagine, our whole planning process, our opps process, our commercial process and our scheduling process had to be very different than it was historically.”  

Now that this new path has been discovered there is no going back to old ways. “It’s been a different way of running and airline and I think that it will benefit us going forward,” said Emerson. “We’ll be much more agile than we were in the past and that will help us.”  

During his interview, SAS CEO Anko Van der Werf also stressed the importance of being able to break out of the mold and adapt as a means to stay relevant.  

Importance of Collaboration & Partnership

When talking about moving quickly and being efficient, this of course cannot be done without collaboration, both among internal teams and external partners.  

Looking first internally, when airlines adapted to a more agile mindset and workflow this meant bringing bespoke departments together. Teams that were previously siloed (or at least less tethered together) began working closely together.  

"Now on a weekly basis with our networks colleagues, we look at the flights for the next six weeks. We take active decisions on a weekly basis with colleagues across the business” Mike Williams, Group GM - Commercial Strategy and Alliances, Air New Zealand. “We start to think about the bigger picture and what’s the long-term strategic outcome for the markets.”  

“We need more freedom, more innovation and more partnerships from technology providers."

This same collaborative mindset needs to extend beyond the walls of airlines and include tech vendors.

Cooperation was another fundamental theme of the event. Airlines can no longer feel stuck inside their legacy systems, but instead need a more open tech ecosystem.  

IBS Software and SunExpress talked about how a more flexible and integrated systems setup has been able to improve the operations of the airline.

SunExpress was able to create a tight integration between its PSS and revenue management system that optimizes both tour operator inventory and seat only inventory.  

“We need more freedom, more innovation and more partnerships [from technology providers]," said Van der Werf.  

The Rise of NDC & Channel Control

Distribution was of course another big topic. Specifically, NDC and airlines trying to have more control of their distribution were big topics.  

T2RL kicked off the event by sharing some fascinating market updates. According to their research, 4.5% of bookings have shifted from indirect to direct channels in 2020, while NDC accounted for more than 10% of indirect bookings, up from about 5% in 2019.  

T2RL is forecasting a significant increase in NDC booking growth as illustrated by the graphic below.

T2RL Research

Hawaiian Airlines is even building its own NDC platform called HA Connect, which will be used to personalize content. “We do intend to do personalized responses based on someone’s Hawaiian mile status as well as offer some unique content and dynamic content into the marketplace,” said George Bryan, Director –Distribution, Hawaiian Airlines.  

All indications point to NDC continuing to grow its influence on bookings. “I’m definitely intrigued by NDC and One Order because that is the future world, right?” said Van der Werf.

Airlines Continue to Get More Dynamic with Offers

When talking about distribution the hottest topic at the moment is dynamic offers, so naturally there was a lot of discourse on the subject.

Nearly all of the sponsoring vendors mentioned dynamic offers in some form or another.  

However, the most interesting discussion was about continuous pricing with Xavier Lagardere, Head of Data, Lufthansa Group. As we chronicled here, Lufthansa have been pioneers in the dynamic offers space, being one of the first airlines to roll out the solution.  

“Continuous pricing is definitely part of a larger thing at the Lufthansa Group and at the industry scale. The need to transform our orders technology and continuous pricing is completely linked,” said Lagardere. “Continuous pricing is dealing with offers and making offers more specific, more current and more adequate to the customer’s demand.

"The need to transform our orders technology and continuous pricing is completely linked."

Lagardere sees this as just the first step in order transformation and looks at PSSs to be the next part of the process to change.  

“The improvement of the customer experience around the shopping basket and the orders list has not happened as an industry for airlines,” said Lagardere. “There’s an entire technology transformation that needs to enable this change that is probably linked to continuous pricing and orders entangling. The next steps are to PSS systems what continuous pricing was to GDSs.”

To summarize the overarching motif of the event, there are tremendous technological opportunities ahead for airlines to leverage and a healthy appetite to invest both time and money into them, which will tangibly move the needle as we step into the next era of air travel.