The top 9 things corporations should know about NDC in 2023

You’ve been hearing about NDC for so long, but you’re still searching for answers. Why does NDC matter in the first place? Is Cytric NDC ready? And what does this all mean for a corporate travel buyer? If you’re asking yourself these questions, you’re in the right place. Here are the top 9 things corporations should know about NDC in 2023.

You’ve heard it before but it’s worth repeating: NDC is all about bringing new retailing capabilities to travel distribution. The travel industry is at a critical moment: most people are used to having personalized content on their Netflix or Spotify feed, and when they open Amazon. Why should searching for travel content be different?

When we talk about NDC, we oftenmakecomparisons to Netflix , because this company was one of the very first to recognize the importance of personalization, and this insight—combined with the right technology—propelled Netflix to becoming a global player and brand.

NDC matters because personalization matters: according to aMcKinsey study , 76% of consumers are more likely to consider purchasing from brands that personalize. Corporate travelers, like everyone else, expect their retail experience to resemble their Netflix homepage: everyone wants choice, convenience, flexibility, and a curated offering that makes decisions easier. We are all used to buying anything on-the-go and to changing or returning any product that doesn’t live up to our expectations with one click. If we don’t know what we want, we can find inspiration using virtual reality or AI powered recommendations based on our shopping history, purchase behavior of peers or our preferences.

So just like Netflix used technology and innovation to change television forever – travel will benefit from new retailing power too. It’s time for a more modern way to connect with travelers, and that’s exactly what we can achieve with NDC.

2. Is NDC Cytric ready and which airlines can corporate travelers book?

The idea behind NDC originated already more than 10 years ago in an IATA think tank. But it wasn’t until 2017, when the first airlines started to release an NDC API that covered the full Shop/ Order/ Pay flow, that NDC became a more widely used standard.

This means we have now been actively working with NDC as an industry for five or six years. Whereas at the beginning only a handful of airlines embarked the NDC journey, now 66 airlines are certified by IATA’s Airline Retailing Maturity Index.

And corporations and TMCs that use Cytric with Amadeus are in luck. Air France / KLM, Finnair, the Lufthansa Group, United Airlines, Qantas, Singapore Airlines and American Airlines: all of these already have NDC content available to book on Cytric. There will be many more to come this year including Iberia and British Airways.

It’s not just the large carriers who are using NDC: we are seeing an increasing interest from smaller and medium sized airlines as well.

At the same time, if we look for examples in our Amadeus system: we currently have 400 airlines connected; this means there are still many airlines that remain available through the main existing EDIFACT technology and this implies that we will be living in a hybrid world for still quite some time where EDIFACT and NDC will coexist. It is therefore very important that travel management solutions can handle both technologies in parallel and – ideally – in a seamless, non-disruptive way.
However, just like in the case of Netflix, we do expect that as technical standardization evolves and innovation accelerates, the transaction volumes will shift increasingly towards NDC.

3. How easy is it to search, book and service NDC bookings?

When it comes to searching and booking, corporations and TMCs should experience little to no change. For example, travel buyers can search for all travel content, including both NDC and EDIFACT on one single screen. However, servicing is something that we are still working to perfect.

One of the biggest challenges we see with NDC is standardization. There are up to eight different versions of NDC actively in use, ranging from 17.2 that was created back in 2017 to the latest 21.3 version that was released last year. There are a lot of differences between one version and the other so implementing and maintaining eight different versions is a complicated, costly and time-consuming process.

Another issue is the user experience: there are too many ways of performing the same action. This is especially apparent in the servicing flows around changing a booking or managing disruptions, like schedule changes or flight cancelations.

Different airlines have implemented different flows: for example, when one airline cancels a flight and reaccommodates the passenger on a new flight, some airlines require an explicit acknowledgement from the corporation or TMC; others will assume silence means acceptance. If the traveler is not happy with the newly proposed flight: some airlines require a specific waiver code to avoid a penalty fee being applied to the newly chosen flight, whereas other airlines will automatically recognize the change is done after an involuntary change and will therefore waive any penalty fee.

There are still quite a few differences in how a TMC can service NDC bookings between one airline and the other, and there are servicing use cases that are not fully covered by either the airlines, or through the aggregated servicing tools.

That’s why standardization is critical to the industrialization of NDC. For the entire industry to get on board, we need to prioritize a streamlined flow and user experience, for everyone involved. Fortunately, we’re confident that as more airlines move to the latest NDC version, 21.3, this will be achieved, because the description and guidelines of how each flow should be implemented and working has been in done in much more detail.

4. Is the content available with NDC really that innovative and different?

In our view, one of the most important ways to accelerate the adoption of NDC is to focus on content innovation. That’s what TMCs and corporate buyers really care about: how to give travelers the best value and most tailored offer. In other words: how to give corporate travelers that Netflix experience.

One area where we have seen the most value added for the corporate traveler is through bespoke corporate bundles, with services included as part of a bilateral agreement between airlines and corporations. This could include things like seat selection, Wi-Fi passes, lounge access, or special agreements for carbon offsets. We’re also seeing offers with richer information, like details on mileage accrual.

In addition, there have seen some interesting changes being made around dynamic pricing. This is important for airlines because it helps them manage their yield, and it’s a development that would be impossible to achieve in the indirect channel without NDC.

This is just the beginning. It is undeniable that the content differentiation made available through NDC is increasing and both airlines and their tech providers are working hard on building additional merchandising capabilities.

5. Why is it taking so long for NDC to come to the corporate travel world?

For a large part this is due to the complex nature of our travel ecosystem. NDC is not a plug-and-play technology. It is not like the lightbulb evolution where we could easily move from the old, high-power consuming, lightbulb to the new energy saving lightbulbs, because the new lightbulbs are still using the same sockets and electric infrastructure.

The switch from EDIFACT to NDC is much more comparable to the change from fossil fuel powered cars to electric cars. The electric car evolution over the last ten years has been made possible not just with technology, but thanks to improved infrastructure and partnerships across governments and many different sectors.

To make NDC a successful, innovative, and widely adopted standard, travel sellers, technology providers, and airlines all need to collaborate and work together on a similar vision. This is an evolution, a shift in the way we work. TMCs and their ecosystem partners need to embrace this evolution to bring NDC to scale, ensuring they have the right content for their customers to stay relevant and providing the best service.

6. Why can’t TMCs and corporations just wait until NDC is more standardized and innovative?

It is true that for the corporate buyer, the initial NDC experience will probably be a mixed one.

In terms of shopping: the experience is already a fully transparent and seamless experience. As mentioned above, corporate travel buyers can view all travel content in Cytric from both NDC and EDIFACT on one single screen for easy comparison. Servicing is where some more work needs to happen.

That said, the only way to progress is to move forward - even if not everything is 100% in place yet. If car manufacturers like Tesla had waited until a battery would give more than 400 miles range and charging points were available every 50 miles, we wouldn’t be where we are today with electric vehicles.

In the UK alone, there are today already approximately 1.2 million electric and plug-in vehicles on the road, and the electric category represented 23% of all new cars sold in the last year. This too is a hybrid situation, with both fossil fuel and electric cars sharing the road.

Those TMCs and corporations that get involved with NDC now will have more influence as the messaging standard evolves and will be able to make sure that their voices are heard. Not to mention they will have a leg up on the competition.

7. What do corporate buyers get if they decide to embark on NDC today?

Some of the highlights include:

• Better or lower fares: either because certain fares have been removed from EDIFACT or because they were created dynamically by the airline and made available only via NDC.

• Exclusive NDC-bundles: Certain airlines offer corporate bundles like “Green or SAF bundles,” and soon we expect corporations and TMCs to have access to corporate bundles specifically tailored to their needs and travel programs.

• Promotional content: either based on a company’s corporate identifier or even on traveler level (like the Frequent Flyer Number).

• Better relationships with airlines: NDC connectivity allows TMCs to have much more granular discussions with their airline partners on what content would really add value for their corporate travelers.

More sophisticated online booking tools such as Cytric are already geared for managing both NDC and Edifact technology in parallel, creating a transparent, efficient and seamless experience, regardless of the content source chosen.

8. Let’s talk about servicing...

As any transition, there will be disruption and a cost of change for all players. The main challenge we face today is servicing. A TMC will not be able to service all bookings with the same level of service or within the same timeframes as they are used to today. That really is the main cost of change for a corporation.

One option could be to start small: with specific fares and for a limited group of users, and then track how much service disruption is really taking place. And importantly: TMCs should agree up-front with airline partners on the “work arounds” if automated servicing cannot take place.

All airlines are very keen to roll out NDC in the corporate segment. TMCs should involve airlines in their NDC plans from the start and agree on what the TMC can do or not in terms of applying a work-around for flight servicing.

For example, if a flight is disrupted and the TMC cannot automatically service the existing booking to reaccommodate the traveler on a new flight, a TMC could request the ability to issue a new booking, so the corporate traveler does not carry the burden of the technology transition happening behind the scenes. The TMC could also make sure that the airline waives any additional cost within pre-established parameters.

NDC is an industry transition that will bring many benefits going forward. And to make this transition happen, collaboration between TMCs and their airline partners and technology providers is key.

Fortunately, a lot of progress has already been made in this area in the past 12 months thanks to a strong collaboration between TMCs, airlines and technology providers. This has significantly increased the level of solution and operational readiness of the industry.

9. What does the future hold for corporations, TMCs and NDC?

Coming back to the consumer in all of us: airlines have increasingly been evolving their product to create more value for the traveler. This will only keep increasing in coming years, especially now that airlines can make their new content available through their own channels, as well as through third party distribution channels.

Now it’s up to corporations and TMCs to find a way to give corporate travelers a new and better shopping experience, where they will get access to airlines’ relevant products, fares and bundles, as well as to more detailed and richer visual information for a better comparison between all the different available airline offerings.

Thanks to NDC, we’re at the beginning of a new era of corporate travel shopping. Corporations and TMCs that are ready for the ride will likely soar above the competition.