Mass Customization and Ancillary Revenue

I am definitely between positions on the announcement by ATPCO of their "ATPCo bundled services product". The cabal supporting this consists of 27 Airlines and 6 Pricing Systems. The focus of the announcement is to talk about the "OC" optional services fare filing capabilities. FULL TEXT OF THE MAY 11th RELEASE BELOW. "Travel Agencies, Travel Management Companies, and GDSs Announce Support for Standards to Enable Shopping, Sale of Ancillary Products Across Distribution Channels."

A notable hold out is American Airlines who feels that the standards will interfere with their ability to individualize the relationship with their customers. AA's Cory Gartner was less than circumspect in his statement to The Beat this week "We are talking about Amazon style, where a customer is coming to us having purchased these things in the past, therefore these are the things that are going to be most profitable for American Airlines to offer because we think customers value these things and will pay for them."

And this is where my dilemma starts. On the one hand I firmly believe that standards are good for the world, but on the other hand I am a fanatic in the belief that suppliers and their customers should be able to define their own relationships. The web has done a great job in developing the abilities of individual relationships between business partners. Driven in part by the use of standards such as XML and HTML. The web enabled open standards and open source software in the process loosening the grip of Microsoft and IBM. But it also enabled the rise of the Google behemoth. Now we need to do things "the Google way". Not necessarily bad but not necessarily good.

Part of me wants to cheer the ATPCo standard. But then this other part of me (yes the older curmudgeonly bit) says - "hmmm seen this before" - and its just another effort to curtail innovation and control the market by those nice people who brought you high costs of distribution. Check out the quotes in the Press Release and indeed the strange bedfellows who combined to endorse the release.

My unease with the cabal of players who are running this are they are saying its a common standard among themselves and enforces the acceptance by the legacy GDS service providers. This represents a closed shop of the usual suspects. Thereby closing out other interested parties who are looking at the dissemination of the data results to the consumer. Specifically stating in The Beat Article:

"The coalition repeated the GDS companies' expectation that they would "provide corporations and travel agencies the ability to shop, book and fulfill airline ancillary services to travelers by late 2010." What remains to be seen, though, is how quickly that would happen and how pervasive it would become."

My unease is that there are many more people involved in search, shop, book and fulfill and itinerary management now as the product categories fragment and as new players emerge to do different/better jobs at serving the consumer.

My challenge is therefore to the "coalition" to show that they are truly open and will publish the standards and make them available - for example under the Open Travel Alliance (OTA) rather than just ATPCo. So that other players who are involved in the travel provision can take advantage of the "standard". At the same time others who chose not to file published or other fare types via ATPCo - such as private fares outside of the Cat 15/25/35 categories - can adopt the same standard. And what about other users such as Tour Operators etc? I think you get my point.

If this is to be a standard then make it truly open so that anyone involved in travel can take advantage of it.

And another point while they mention EMD, the BSPs (in international markets are ignored). As I have written before - the financial fulfillment process of Ancillary Revenues is the Achilles heel.

In the mean time - I think I will continue to cheer on others who are bringing new and better products and services which add value to the whole market and helping build better relationships between business partners, not just the old guard finding more ways to put fences around the existing legacy GDS based "one size fits everything" model.

Anyone willing to take me up on this challenge?

Cheers


Here is the full text of the Press Release:

Travel Agencies, Travel Management Companies, and GDSs Announce Support for Standards to Enable Shopping, Sale of Ancillary Products Across Distribution Channels

NEW YORK, NY, May 11, 2010 - The industry’s leading travel management companies, online agencies, and global distribution systems (GDSs) today announced their support for plans to implement recently developed, industry-wide technology standards which enable shopping, booking, payment, and reporting of ancillary services. These standards will also facilitate the use of new capabilities that are being developed by the GDSs to help agencies manage the complexity of unbundled offerings, while enabling airlines to differentiate through the sale of ancillary services across all distribution channels. Use of these common and recently launched technology standards will create the opportunity for airlines and agencies to sell ancillary services seamlessly, and corporations to optimize their business travel programs by better anticipating and tracking their full air spend.

American Express Business Travel, BCD Travel, Carlson Wagonlit Travel, Despegar, Expedia, Egencia, HRG, Opodo, Orbitz, Orbitz for Business, Travelocity, Travelocity Business, Amadeus, Sabre Travel Network and Travelport have agreed to support common technology approaches for the merchandising of airline ancillary services.

British Airways, Delta Air Lines, LAN and WestJet support the development of this capability as an option for distributing new products and services. Additionally, Air New Zealand has confirmed that it is mobilizing OC and EMD projects.

By combining ATPCO’s (Airline Tariff Publishing Company) category for optional services “OC” fare filing capabilities with soon-to-be-enabled Electronic Miscellaneous Documents (EMD), airlines will be able to quickly introduce their revenue-building ancillaries to the broadest travel audience through both indirect and direct distribution channels. The group of travel industry buyers also endorses the development of common messaging standards for direct API solutions for those airlines that wish to manage the ancillary data directly with a GDS, enabling the easy and efficient shopping, selling, payment and reporting of ancillaries.

Travel agencies are experts at selling airline products to their customers, and they have keen insight into how these groups want to buy airline products. By using industry technology standards, airlines can quickly deliver the ability to sell ancillary services. Additional capabilities will emerge throughout the year to enable corporations, agencies and airlines to complete the sale and fulfillment of these products within the GDS, enhancing agency efficiency at the point of sale, and integrating into existing back office systems.

Over the past year, many airlines have evolved their business model in an effort to generate incremental revenue by either creating product bundles that differentiate their offerings or by bundling and unbundling various products and services, such as premium seating or baggage fees. Today’s announcement aligns GDSs, online travel agencies and travel management companies around support for the use of recently developed technology standards to help airlines introduce new unbundled fare structures, and demonstrate what is included in bundled fares, while also providing consumers and business travelers full choice and value in their air travel options.

Many capabilities enabling the sales of ancillary services already exist within the GDS environments. Airlines that adopt industry technology standards are expected to plan how to best leverage it this year. The GDSs plan to provide corporations and travel agencies the ability to shop, book and fulfill airline ancillary services to travelers by late 2010.



QUOTES:
Amadeus
“It is a great achievement to have all these parties endorse the best way forward for the travel industry. We believe supporting these technology standards will benefit everyone in the travel value chain, from providers to travelers. Airlines will be able to differentiate their ancillary services offer and market it more effectively through travel agencies and to consumers,” said Philippe Chérèque - executive vice president, Commercial for Amadeus.

American Express Business Travel
"When it comes to providing merchandising options to our valuable customers, its critical that we have broad access to such supplier content, that fully integrates into our downstream processes," said Michael Qualantone, vice president/general manager, Global Supplier Relations, American Express Business Travel. "We want proven, reliable and efficient technology to avoid additional cost, processing errors and service disruption."

BCD Travel
Rose Stratford, senior vice president of global supplier relations for BCD Travel, said “We applaud a standardized approach that will enable us to better serve our corporate travelers. It will offer us the opportunity to better manage our traveler needs while providing our clients with the transparency and reporting necessary to manage ancillary fees more efficiently.”

Carlson Wagonlit Travel
Matt Beatty, vice president, Global Supplier Management for Carlson Wagonlit said, “With the GDSs providing quick and easy access to ancillary products and services via common, industry-wide technology standards, we can help our clients and their travelers make better-informed choices to meet their business travel needs while optimizing the efficiency and cost management of corporate travel programs.”

Delta
“Delta supports this development of technology that facilitates the potential distribution of new ancillary products and services. We are continuously seeking distribution methods that satisfy the marketplace, and this technology is an option we are considering. It is important that we work with our agency partners to find the best possible solutions for our customers,” said Jim Cron, senior vice president, Global Sales and Distribution for Delta Air Lines

Despegar
"Despegar.com believes that customers need clear information in order to choose wisely. By setting these standards the travel industry is moving one step forward towards price transparency," said Roberto Souviron, chief executive officer, of Despegar.

Egencia
"It's important for the industry to come together to solve our common issues," said Rob Greyber, president of Egencia, the corporate division of Expedia Inc. "By adopting these technology standards, we can increase the visibility of ancillary costs to travelers, which is good for airlines & travelers, and keep corporations ability to control spend. Policy controls govern financial accountability at the point of purchase, lessening the audit burden for corporations.

Expedia
"A concerted effort like this to make these products bookable in the most prominent booking channels sets up all parties for success," said Gary Fritz, president of Expedia Partner Services Group. "These standards pave the way for making a la carte airline products more transparent and accessible to leisure travelers, which in turn will lead to higher adoption rates."

HRG
“Following our call for common standards last year, joining this group enables us to continue with our drive in this very important area. It will enhance the way we deliver our products and service changes to our customers so that it works for everyone in the value chain,” Bill Brindle, Business Technology and Distribution Director for HRG.

LAN
“Convinced that merchandising and ancillary revenues are an effective way to differentiate and diversify in an industry highly pushed towards commoditization, LAN initiated a couple of years ago an important effort in order to actively participate in these business streams,” said Sergio Mendoza, vice president, Distribution and Revenue Management at LAN. “A multichannel strategy definitely helps us better serve our customers and represents a competitive advantage. On the other hand, standards are necessary in order to simplify and make the multichannel distribution feasible and efficient. We have a huge challenge defining those standards for a business model that is being created as we speak, but that is what makes all this so much fun.”

Opodo
“To agree on the use of common industry standards in the merchandising of ancillary products is a crucial development for the travel industry. We are proud to be part of a move which will ultimately enhance consumer protection and trust,” Ignacio Martos, chief executive officer of Opodo.

Orbitz/Orbitz for Business
"Orbitz Worldwide has been in discussions with the airlines regarding how to appropriately merchandise their ancillary services for an extended period of time, but finding an efficient technology solution has been a major barrier to progress. Establishing industry standards will result in more productive conversations with our airline partners that will allow us to focus on their business needs rather than technology solutions," said Michael Nelson, president of the Partner Services Group, Orbitz Worldwide, Inc. "The end result will be that our business and leisure customers will have access to the information they need and the products they desire."

Sabre Travel Network
“Everyone wants a healthy travel industry, and it’s clear that ancillary sales have been successful in helping airlines increase revenues,” said Greg Webb, president of Sabre Travel Network. “But this revenue success for airlines has come with a number of challenges for consumers, travel agencies and even the airlines. We intend to solve these issues so the real value of travel can be experienced by everyone.”

Travelocity
“Our top priority is making it easy for consumers to understand the perks and costs of choosing different airlines, and we’ve got several tools on the site today that help,” said Noreen Henry, senior vice president, Partner Marketing for Travelocity. “But, with the increasing number of add-on fees, it’s important to establish a common way for airlines to deliver that information to sites like Travelocity. Having these standards is a necessary step in helping us show consumers all of the possible options and the associated costs.”

Travelocity Business
“In business travel, lack of visibility into ancillary fees is not just a challenge for the traveler, but also the corporation that tracks and manages the total cost of each trip,” said Yannis Karmis, president of Travelocity Business. “A universally-recognized set of programs, delivering an accurate measurement of overall value for selling, tracking and accounting for ancillaries would offer transparency benefitting both airlines and travel meets the requirements of CFOs at all parties.”

Travelport
Travelport’s mission is to deliver informed choice to business and leisure travelers throughout the world – which means ensuring that each and every search results in a complete and comparable display of competitive travel options,” said Gordon Wilson, deputy chief executive officer of Travelport. “In this context, accelerating the adoption of industry-wide technology standards for airline ancillary services will bring greater transparency and choice to travelers, while enabling airlines to merchandise their products in the way that they want to sell them.”

WestJet
“WestJet sees the sale of ancillary products via all distribution channels as an important part of its value proposition going forward,” said Catherine Dyer, WestJet vice president, Distribution. “We think it’s important that our valued agency partners have the ability to sell these products to our guests in a way that is efficient and convenient.”


MEDIA CONTACTS:
Air New Zealand Amadeus
Mark Street Corporate Communications
Mark.Street@airnz.co.nz +34 91 582 7809
mediarelations@amadeus.com
North American Media Contact
Debbie Iannnaci
+1 305-499-6448;
diannaci@amadeus.com


American Express Business Travel BCD Travel
Tracy Paurowski Thad Slaton
+1 212-640-8409 +1 678-441-5292
Tracy.j.paurowski@aexp.com thad.slaton@bcdtravel.com

Carlson Wagonlit Travel Egencia
Kim Derderian Paige Young
+33 (0) 141336044 +1 425-679-4053
kderderian@carlsonwagonlit.fr pyoung@egencia.com

Expedia HRG
Katie Deines Fourcin Sallyanne Heywood
1 425-679-7991 +44 (0) 1256 312624
Katie@expedia.com Sallyanne.heywood@hrgworldwide.com

Orbitz/Orbitz for Business Sabre Travel Network
Brian Hoyt Nancy St. Pierre
+1 312-894-6890

Is The Travel Recovery Faltering?

April and Early May were not good months for the Travel Industry across the pond. The latter half of the month saw the Ash Clouds from the angry Icelandic Volcano.

But it seems that the surge in bookings we saw from the beginning of the year was not being sustained.

ARC's April numbers - total transactions - show a decline in growth.


But we are not going to see a boost in May either. We have more ash disruptions and BA strikes. But this should not materially affect the bigger picture of travel in the USA market.

So there is something going on. The economy is beginning to feel the heat of the Eurozone crisis. But the Europeans should not be affecting the US point of sale. The high cost of travel across the Atlantic with Eastbound traffic is beginning to bite. Perhaps the US carriers have cut back too much and more capacity needs to be added for the summer. Checking on flight prices across the Atlantic in both directions doesn't give much comfort despite the dramatic fall of the Euro against the dollar.

As I reported earlier the Pow Wow delegates are now trekking their way home probably less enthused than they could be.

Let's see how the Summer 2010 will progress. I am not terribly optimistic that we are going to see that bounce being sustained

And what do you think?

Cheers

Does Google Get It Right Always?

Google has been the all conquering hero for some time. But as we have seen of late that gleam is wearing a little thin and with a certain amount of tarnish on it. The recent privacy spat over their "accidental" collection of data is an example. I used to work for a very large company who was also accused of such bad behavior. So I have some empathy for the impact.

After the huge hype for Nexus One phones - the unlocked Android based phone directly from Google - the company decided to shut it's only web store. I recently had the opportunity to play with several Android phones. Its funny that the level of quality on the software of the Android phone was not unlike the way Google handles search. Its almost good. But it takes a degree of effort to get a great result. If you work in software a long time - you realize that users expect perfect results. Yet we never get the perfect answer. Many times we don't even get a great answer. But I really did expect the product to be a lot better than it is. I also got to play with other versions of the Android. WAY BETTER!!!!

This had me thinking what will Google be like if (or rather when) it goes directly into the travel transaction business. ITA has built a very good business in solving search for single vendors and neutral players such as Kayak, Bing and of course Orbitz. One thing is for sure - the nice gentlemanly rules of the club will not be played by Google. Why? because they don't play by the rules as we know them. In fact Google's whole business ethic is about breaking the rules. Good thing or bad thing?

So the one thing that worries me more than anything else is that quality will be a casualty. But stick with me here a moment. Perhaps Google took a look at the quality of travel content and decided that actually it matched Google's loose approach to quality. Lately I have become involved in search. I think search is going to have a profound effect on travel and the way it is managed and handled. We are still very early in search in travel. This will be a long road. There is so much more to be learned about search. Mostly that the ability of the content to be searched can - at best - be described as embryonic. Travel content (or more accurately components of travel products) don't lend themselves well to search. So we tend to simplify and abstract the minimum level of data in order to serve up search results which if we are truly honest are pretty crappy. Oh yes and of course few if anyone (on the true supply side) really wants to let the product be searched effectively.

To answer my own question - I believe that Google just may be correct about travel.

But it doesn't mean that it is right. Nor does it mean that Google's way is the right way.

But we are about to find out how much fun it will be to try. And my exhortation to everyone else - particularly the existing players in the business - is we had better get serious about search. If not we will be saying that Google has become the evil empire.

Cheers

"No Harm, No Foul" Says Google

In the continuing noise over Google's collection of data "accidentally" Google's CEO Eric Schmidt posed a question: "Who was harmed? Name the person," Mr Schmidt said at the company's annual Zeitgeist conference in Watford, UK. (BBC Quote).

So let me extend the analogy, if someone spies on another person either through a keyhole or via an internet camera - is that a crime. If the other person didn't know then what the harm?

So let's be clear Mr Schmidt - collecting data was NOT accidental. Someone did it deliberately. And their rights were abused. In some countries that is regard as an offense. In some countries it is not. In all countries it is an abuse.

In the US, advocacy group the Consumer Watchdog (according to John M Simpson, of the group) has written to the FTC (US Federal Trade Commission) saying it should investigate Google.

"Google has demonstrated a history of pushing the envelope and then apologizing when its overreach is discovered, given its recent record of privacy abuses, there is absolutely no reason to trust anything the Internet giant claims about its data collection policies."

War driving is fun but you don't store the information.

'Nuf said?

Do Airlines or GDSs Cheat on Displays?

I love finding things that don't work or fail to work as billed. I have been recently working on a project with regards to competition and compliance. I went back and had a good look at the current European Union CRS Regulations.

I was working with one of my team - Professor Sonja - and she noticed that some airlines fail to comply with the letter of the regulations. But as to whether they are technically in default or manipulating the system - I will let you be the judge.

So here is the rule:

Point 10 from the Regulations Annex states:

Where air carriers operate under code-share arrangements, each of the air carriers concerned — not more than two —
shall be allowed to have a separate display using its individual carrier-designator code. Where more than two air carriers
are involved, the designation of the two carriers shall be a matter for the carrier actually operating the flight.



if you look at the 2 examples above you will see that in fact in the display (from Sabre) that indeed there are three instances of the same physical flights shown. However on one of the combinations a specific flight does not show any classes of service. OK so is that within the law? Now look carefully at the two different sets. In set one (yellow) you will see that the flight times are off by 5 mins. So the first flight on the combo might not be the actual same flight. Actually we checked with both the airline res and the airport and they are. In the second option (green) the equipment is different (777 vs 332).

This was a specific case we stumbled upon by accident but I firmly believe there are a large number of these instances where the GDS displays show more than the designated 2 options. It would seem that someone needs to go and check the correct compliance with the pertaining regulations.

Agreed?

Cheers

PS before anyone starts on at me about the schedules being out of sync and this is an isolated example - I can show many more from different dates and times. Some airlines are worse than others.

Google - "accidental data collection"

Google issued a giant mea culpa for "accidentally" collecting data about websites people were visiting.

Politely Balderdash....

Last time I checked - collecting data of any sort requires a conscious decision. There was no accident about the process. A Google engineer (inhouse or contractor) designed the system to collect data. The supervisor reviewed the code. The hardware for the storage of data had to be purchased and approved. The device had to be set up to collect data. The data had to be stored somewhere. So data was collected in 30 markets.... I think you get my point. I don't think by any stretch of the imagination you could call the collection of data "accidental".

Now the question is will Google take any advantage of the meta data (ie data about data) that it collected. Will it also notify all those people it collected data from that it did just that - collected data of a private nature.

These are questions that will fuel the fire of Google's practices. For some time - Google's practices have worried me. I don’t want to slam them for everything that they do but I think we should all be on the look out to ensure that this sort of thing does not occur again. Google as the world's largest data touch point service has more information on each of us that it can correlate together, than anyone else. What it knows about us is pretty scary. Combining that with travel pattern information would give it power that no other supplier in the travel vertical has ever had. The potential for misuse of data - actively or accidentally just boggles the mind.

Cheers

US Inbound Visits Decline 6% in 2009

For a tough year the US managed to eek out a smaller decline incoming than might have been expected. Year on Year according to the US TIA - the overall decline was 6%.

There are three reports that can be viewed.

To view the top states and cities visited by overseas travelers, go to: http://tinet.ita.doc.gov/outreachpages/download_data_table/2009_States_and_Cities.pdf

The 2009 overseas traveler profile may be viewed at: http://tinet.ita.doc.gov/outreachpages/download_data_table/2009_Overseas_Visitor_Profile.pdf

To see the market profiles, go to: http://tinet.ita.doc.gov/outreachpages/inbound.general_information.inbound_overview.html

There are some interesting characteristics that can be gleaned from the data.

Business Travel took a hammering - down more than a million visits and who dropped in market share to now around 20% of all trip visits. This reflected the major drop in transatlantic business travel which is reflected throughout the report. Leisure travel rose slightly. The needle didn't mover for many other points. For example advance purchase stayed the same. Average number of nights etc.

And what of 2010.

The rise in the dollar is going to hurt inbound in my opinion. The increase in the dollar against the Euro has been significant in 2010 and with the Euro zone in financial crisis we will see a slackening off of Euro visitors. This will be offset by a rise from Asia and Latin America but remember that Western Europe represents the largest proportion of visitors to the USA and double the number from Asia.

So US vendors selling inbound better sharpen your pencils at Pow Wow starting tomorrow.

Cheers

Dubai - Reset

The headline this morning may seem quite dramatic. Here is the coverage from ATWonline:

Emirates fiscal-year profit soars to $1.1 billion

Emirates Group reported net income of AED4.2 billion ($1.14 billion) for its fiscal year ended March 31, a substantial increase over a AED1.49 billion profit in 2008-09, marking its 22nd consecutive profitable year despite what it described as "a year fraught with worldwide market instability and economic uncertainty."

So this morning there are a lot of happy people in Dubai and smiles all round in that nice new building that is their HQ.

I was in Dubai for the Annual Arabian Travel Mart last week and I spent some time speaking to many people from the business, who live in the region and Dubai itself. While ATM was - shall we say a bit quiet - I don't have the numbers but as a seasoned show goer - it was quieter than I expected.

There has been a significant downsizing. Perhaps not of the total economy but definitely of people's expectations. The two ex-pat communities are both notably chastened by the bursting of the bubble. There is still a correction on-going. There are wonderful anecdotal tales of people whose job it is to move the tower crane so it looks like the building is still being built. What is not anecdotal are the canceled and delayed projects. Even the closely controlled newspapers are full or projects where the boosters are denying that they have been canceled. But suffice to say the boom curve is a lot flatter and a lot further out. Next month will see another mini-exodus of expats at the end of the school year. Some broken dreams will be realized.

Out at "The World" the essence of extravagance - there is but one lone property occupied. It looks a little forlorn but I am sure its owner is very happy.

For the travel marketplace - this will take some time to smooth out. There is an excessive amount of inventory that needs to catch up to the travellers. Strangely enough Dubai and Las Vegas share a lot more of issues than they might think.

However overall I am impressed with the way they have dealt with the bust. The taxi drivers sound a little happier (always a good sign). And the flagship of what the airline means to the rest of the world is giving them pride again. The price was heavy and will continue to be so. How much and exactly what form is unknown to all but a few.

Cheers

Is a Fee a Tax? The Aussies now know

The Australian Federal Court ruled in court this week that a Fuel Surcharge is not a tax (even though it has been listed in the fare rules as a tax like item). As a result of the ruling - the Australian agents will get a windfall of commissions due during the time the surcharges were first filed.

Whether the ruling is appealed (highly likely) and it makes its way all the way up to the Australian Supreme Court remains to be seen. But we are now seeing that the issue of what is a fare, what is a fee and what is a tax will need to have greater scrutiny.

For the US environment - the USA Internal Revenue Service actually ruled on this last year, declaring that ancillary revenues are not a fare and not a tax. Thus opening up the opportunity for every jurisdiction where an airline product is sold (absent pure airline transportation fares) or delivered to be taxed.

As you can tell the airlines are none too pleased with this ruling. But unbundling the fare into these buckets of fees etc was hardly likely to escape the scrutiny of the lawyers and the tax authorities. Indeed anyone who unbundles their products will be under scrutiny. (er hummm GDSs - are you paying attention here?)

I would caution on too much celebrating by the agents at this point. They will of course have to pay their own tax on this!

Cheers

Say Goodbye to 2 Storied Brands

Today as they say is the first day in the rest of your life.

It also marks the end of 2 storied airline brands. As regular readers know I am a bit nostalgic for airline brands.

Today Continental announced that it will be subsumed into United. Also at various press conferences and meetings over the past few days - Air Jamaica (Air Jam) has been consumed into Caribbean Airlines.

Somewhat sad but understandable.

Farewell both of you

Cheers

Open Travel Comes to Seattle - Where Are You?

Open Travel has its first full meeting in 2 years starting tomorrow.

With a good crew of technology luminaries from most of the major sectors. I was privileged to spend an hour with the board meeting today looking at where the organization goes next. Tomorrow we get into the meat.

No promises but I will try and do a follow up blog on what happened.

During the show Stephen Joyce and Dennis Schaal of TNooz will be tweeting and blogging. Further in the evening we have TCamp4 hosted by Gene Quinn and Dennis will aim to make sense of it all.

Hot on the Agenda already are Ancillary Revenues and the complexity of delivery into the market.

So what aren't you here?

Oh yes - I know its because you think it rains here all the time (OK so today it lived up to its reputation).

Cheers

Search vs Navigation?

Are you a control freak?

I am - well maybe just a little bit. What do you trust more - navigating down YOUR path or relying blindly on search - usually Google based on a specific site.

The answer is fundamental to how we build our sites and how we allow the user community into the site. If search was so good then theoretically we wouldn't need deep linking. But we know that despite the squillions that are spent on search it is still an imperfect art. Getting a lot better - but still pretty naff. And there is a good set of reasons to this. Most websites are still first generation affairs still relying on the same logic that got them onto the web in the first place. People got fat dumb and lazy and frankly scared to fix something. So company websites tend to be largely imperfect affairs of a spaghetti like mess of inconsistent blocks of data (don't you DARE call them information). The user is FORCED to hash through them looking for good quality data that they can use. If you don't believe me - just try searching for your number one product or attribute on your website and see what gets returned. Go on - try it - I dare you (with acknowledgment to the late Robert Conrad). I think it should be comulsory that a company's CEO and top management team must all sit in a room with their customer service staff and show them how well they navigate around their company's shop window - aka the website. It would be a wake up call.

For me - I pretty soon get cheesed off with the search facility on the site and almost always end up using navigation which in turn is inconsistent and often leads to to seeing SO many broken links and poor results. (Not to mention all the circular loops that poor nav leads me to).

The premise that any information is better than no information seems to drive a lot of people's thinking. It is why we all have Web ADD. WE just don't get a good experience so we keep looking until we get what we want. Or until we lose interest. Which seems to be the majority of the cases.

Back to our question of the day. Gerry McGovern's piece this week argues that Navigation is more important than search. Aha - for once I disagree with him. It is BOTH. They are the yin and yang of your business. You need them both and one without the other is to upset the natural rhythm of the universe. BUT you have to make sure that they work both in tandem as well as individually.

Too few people forget that - don't you be one of them...

So back to dealing with control freaks - here is a little article for you to enjoy.

Cheers and Happy Sunday.

Apple's iTravel May Have a Problem

Just for fun I searched the Apple site for the word iTravel. Seems that someone on the iphone app filed an app called this in October of 2007. They have a website hotelwidgets.com

So before everyone starts using the term iTravel they had better be careful

And its only Saturday!!!

Cheers

What Does Google Really Want From ITA?

So speculating on why Google wants ITA software ranges from the good to the bizarre.

The usual candidates are its Search Business, its software and its expertise. But I have another idea. In addition to the above - how about it wants to become a huge player in the overall travel space and can do that with the significant library of ITA's Patents

Let me list a two of them...

The Needlebase Patent - United States Patent 7668740

Fare Construction Patent US Patent 6263323

I wont spoil your fun by listing them all - but there are a lot of them. The categories range from payment to user interface to shopping as well as the obvious. And these are but a few. You can be darn sure that right now there are a bunch of lawyers pouring over these little gems.

And there are a whole lot more being filed and in the works.

Think about it.

If you are in the business of travel - perhaps you should be afraid now. If high priced Google patent pit bull attack lawyers get a hold of these - those of us in Travel Technology will have a very miserable life.

Scary?... Yup - now you see why that $1 billion number is not that bad.

Cheers

PSS and GDS Customers Might Want To Revisit Their Contracts

This is a salutory warning to those who interact with external (typically GDS based and PSS based) systems. This post should be read by airlines, travel agents and third party technology providers to the passenger industry.

In the overall scheme of things the unprecedented events since April 15th of the Volcano should cause those who pay bills to the GDSs for products and services to go back to look hard at their contracts.

If you have a contract that has threshold clauses in it - then definitely pay attention.

Let me pick on 4 customer types:

Airlines - IT Customers
Airlines - GDS - Participating Carriers (PCA)
OTAs - GDS subscribers
Travel Agents - GDS Subscribers

I also recommend anyone who has a signed GDS contract as a third party technology provider should also read this post.

In the next few weeks and months the airlines are going to be getting a lot of extra charges from, amongst others, Amadeus (the bills will come due after the IPO). Amadeus is on the record as saying that the volcano will have minimal impact on their IPO and are steaming ahead with it. What they didn't say was if the impact will be bad. It just may be - as more than one person who reads this blog told me - positive. The airlines didn't cause the mess but they are going to be paying for it no matter what. But all that extra processing is going to be an additional cost for the airlines. All those passengers who were checked in and then had to be "de-boarded" Hmmm that will be interesting to see how that works in those contracts. (PSST Hint to other PSS and airline IT vendors - if you didn't cash in on this gravy train more the fool you!)It is very important that the bean counters examine their invoices from their vendors VERY CLOSELY over the next few months to ensure that all the costs that are in the contract are correctly charged and that the Airline IT guys don't try and slip in some extras in there. I liken this to an unscheduled maintenance on a car. You get the bill and the estimate just doesn't match what you were quoted for!

For PCA based agreements - the cancellation costs that may be accrued needs to be carefully studied. Every airline accounts receivable person worth his salt better be on his toes. Also those nice bill auditors - people like Kale Consultants - should get into the act and make sure that they are poised to check and support their customers - the users.

For OTAs, the big ones at least, they should be OK (GDSs have a habit of turning a blind eye to larger users) - however head back to your contract and look at the threshold clauses. You will like be breaching them. Hitwise and others reported record breaking traffic which translates into a lot of extra hits for NO ADDITIONAL revenue. For smaller OTAs and those whose IBE is provided by a third party - indeed the 3rd party technology providers as well - go check out your contract. I just checked mine and I cringed. Fortunately I had no traffic on it last week!!!

For regular travel agencies whether or not you have an online presence via a booking engine, you need to make sure you have checked your activity. For those bookings that were canceled or re-booked by you - you should be OK. But for those cases where you helped your stranded clients and looked for viable options for them (because you are a customer service operation) and didn't generate additional GDS bookings - you will be hit by a double whammy - additional traffic and several days of no revenue.

With BA and others shutting out inventory, other airlines generating schedule change messages onto queues - there was an AWFUL lot of airline initiated traffic that resulted in extra hits with no corresponding revenue.

If you are one of these people - it may be a good idea to pull out your contract and have a deep look at it. If you are adversely affected - you might want to consider this next time you are sitting round the table whether its for a cold brew or its a hard negotiating session.

You have been warned

Cheers

BA Blames Others For Res System Snafus

In what must either be a simmering dispute between Amadeus and BA or Amadeus's failure to provide basic functionality to BA Reservations - Willie Walsh went on the offensive with his pleas to having customers be patient with BA as they rush to restore order and get people home.

Knowing a little about the reservations system - it would seem that either a rule could be written to cover how interline, codeshares and GDS based new bookings could use the system at a lower priority for BA's own customers. To wit - BA has an unused letter in its inventory bucket system which could be used to accommodate passengers who had existing reservations. "R". While my solution would be simplistic with a bit of jerry rigging the customers with existing tickets could be ticketed on a priority basis in R notional bucket ahead of any Y seats. only when R's were exhausted for a particular flight would the seats cascade down to open classes of seats. Yes it would take some effort but it would be a solution.

However it seemed all the bright sparks at Amadeus and BA couldn't figure out a system way to handle the customers who were stranded. Result - BA had to shut off all access to its seats for new customers and others alike. Turning it back on again has proved to be a little challenging. With reduced staff manning the check in process there are fewer people around who know how to fix it. Hats off to the boys and girls who work on the line in res who had to work all these queues!

In defense of BA - Willie is right - this whole thing was unprecedented. But airlines spend a lot of time creating and planning for disaster scenarios as existed. Well boys and girls we now have a new one to deal with. And it is likely to happen again. That Volcano could erupt for hundreds of years.

But let's also say that there has been a creeping issue which is now confronting airlines. Lack of Capacity. With an estimated 3-5 years of airframe production capacity now sitting parked in various deserts the reduction and better matched ASKs to RSKs - the capacity of the overall system to match seats in the situations such as we have seen becomes a lot harder. Airlines should go back and look at their scenarios on how they can plan for eventualities such as this. And don't forget that now there is a legal requirement to adhere to newer tougher rules - The EC Customer Protection which came into force in 2005 was enforced by the EC. Regulation (EC) No 261/2004.

For sure - the chaps who design and sell and more importantly manage PSSs should think of how they can deal with situations like this in the future. Welcome back to the world of FIMs and Reaccomodation. And don't forget the Law is going to be breathing down your neck.

Cheers

The Germans Are Coming (Again)

Deutsche Bahn - German National Railways - was at one time the world's most loss making travel business. Today it is the model of efficiency. The services are pretty good. I recently road the rails with them and was even more impressed than before.

Now it seems they are setting their sights across the waters to the UK Based pan European Bus and Train operator Arriva.

This would mark a significant expansion outside Germany for DB.

DB will be subject to some strict scrutiny not just by the regulators but by other European Short Haul transport operators - I am thinking Ryanair for one. How much of the State subsidies are used to fund these forms of acquisition is a touchy subject in Europe. The quasi government owned or subsidized entities have advantages. Not least of which is the underwriting of the risk in their core businesses. The BBC and its commercial arm BBC Worldwide Ltd (formed 15 years ago from the BBC Enterprises unit) competes with many commercial operators. And let's not forget the Boeing vs. Airbus battle.

So will DB be successful in its bid for Arriva? Probably. This is a business of enormous scale and with significant labour issues. Arriva alone has 34,000 employees.

Watchout... The Germans are coming!

Cheers

A Week In "Customer Service" Hell

According to my phone logs in and out - this week I have spent more than 22 hours of time "interacting" with Customer Service operations. These ranged from technology companies to financial services to airlines and hotels.

What a thoroughly unpleasant experience. I have come to the following conclusions:

After more than 15 years of full on internet - Customer Service has ceased to exist either by phone, chat and online.

Users have no choice but to use the web as the human customer service is so universally awful.

The damage done to brands is largely self inflicted.

The basic tenants of human decency have been replaced by fake concern and routine lying

Lying is an art form and comes in so many ways.

Perhaps I should have come to earth at a different time. Because the whole experience of talking to these people has been universally bad.

I realize I may not be the easiest person on the planet but trust me on this one - I tried all sorts of different tactics - being nice, being dumb, being assertive, it really didn't matter.

Of the more than 25 people I have spoken to - there was JUST ONE - who actually listened to my problem/issue and then worked with me to resolve it. But she was clearly off her script by that time. But thanks to her - something that had taken days to not resolve with some of her colleagues - she worked at it and (heaven forbid) even called me back to make sure it still worked.

So to all you customer service managers - or Chief Customer Contact Person - YOU SHOULD BE ASHAMED OF YOURSELVES.

Cheers

With SPECIAL thanks to Orange (subsidiary of France Telecom) for the image from their article on how to complain.

CO says "The Economy Rebounding Slowly" - But do we agree with them?

In the first quarter of 2010 - almost all the airlines reported their numbers. I note that the big 6 (WN, US, UA, CO, DL and AA) all had cautious words to say about their performance.

However I am not sure I agree with them. ARC's numbers for revenue/bookings not passenger's flown show differently.

The numbers show a very strong resilience in pick up from January onwards which in turn has shown a gradual rise from the low point of the middle of last year. Indeed March's numbers are at the same level for revenue and transactions as March of 2008 the previous best month on ARC record.

So to say the economy is rebounding in Continental's words "slowly" doesn't quite gibe.

But then I am just a passive observer...

Cheers

Welcome To Earth Day - Boy Is She PO'd

Mother Nature - (aka Mother Earth) should be happy with us. We are starting to do some real things to address the damage we have done to our environment.

BUT is it enough and is it too late?

Probably not to both questions but here is a short list of some things we can do to change behavior and stop abusing our home. These are all easy and good things to do.

1. Stop using Plastic Bags. At my house we have a bag holder. It used to get filled up, we had to get another one. Now it is rarely filled and the only thing that goes in there is the newspaper protector. I ALWAYS (or at least try to) refuse to get a plastic bag at any retail point. My car is now full of those recycled bags and I put a little note on the dashboard to remind myself - "Got Bags" before I go into a store. This is something you can do.

2. If its less than a mile WALK. Stop using cars for short trips. If its less then 3 miles - the bike it.

3. Reduce the food waste. Try this experiment. At the end of each meal pile all the unused food onto a plate and put it on a scale - then see how much you wasted. Doing this every day for a week see if you can reduce the amount by both cooking less and eating the things on your plate. In my household we have reduced the amount we throw away to almost nothing. Do the same thing in a restaurant. There is no shame in sharing meals or ordering 2 appetizers rather than a grossly filling main course.

These are 3 easy things you can do.

Remember my motto - Avoid, Reduce, Repurpose and Recycle.

This is good for all of us.... try it today

Cheers