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Skyscanner's CEO outlines the future of airline distribution

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After the turn of the century, distribution in the airline industry was a relatively simple affair. Direct distribution meant the customer going straight to an airline's website to make their booking. Everything outside of that in terms of Internet sales was considered third party, and that third party distribution came with a cost attached to it. As a result, the choice for airlines looked fairly simple: bringing traffic to airline.com direct meant generating bookings, which could then be effectively upsold at a far lower cost of acquisition. But in the last decade, significant shifts have taken place both in the way travellers search and discover their trips, and the ways the aviation industry has made its flight products discoverable. Emerging platforms like voice controlled digital assistants and bots, coupled with evolving online marketplaces, mean the lines are blurring. As a result, the point where an intermediary’s relationship with the traveller ends and an airline begins is no longer as clear as it once was.A recent white paper from Skyscanner has set out the vision for the future of airline distribution and the changing role of meta-search in the dynamic airline marketplace, which can be categorized into the four areas below.The blurring line between direct and indirect bookingsThe evolving technology landscape, coupled with increasing consumer preference for mobile, and evolving click-tap platforms such as chat bots, has changed the meaning of what can be considered a ‘direct’ air ticket purchase. In this evolving environment, the former line between direct and third party intermediaries has shifted, while the need for a friction-less shopping experience offering rich and dynamic airline products has increased.Creating an airline marketplaceThe future of Online Travel Agents (OTAs), such as Expedia, and those of us who provide travel meta-search engines lies in collaborating with airlines to deliver their version of the supplier managed marketplace to travellers across the world. This will bring airline branded experiences to meta-search, creating an experience that is as close to direct as possible. This will give carriers control over their products and brand, while benefiting from traffic, and audiences, across a range of devices.By creating an airline marketplace offering carrier "store-fronts", which are virtually indistinguishable from airlines own booking sites, suppliers can enjoy greater branding control and the ability to tap into the wide audience of travelers embracing metasearch or OTAs. And this is being done via a variety of devices - from apps through to chat bots. Many airlines still have limited mobile booking options on their own sites, and the vast majority haven’t even started to look at newer emerging technologies such as bots.Different ways to purchaseInitiatives like the International Air Transport Association (IATA) and New Distribution Capability (NDC) are pushing the industry to transform the way air tickets are sold to travellers. As Rogier Van Enk, VP distribution, Finnair puts it, "The next few years will see a major update of the technical ‘plumbing’ of airline distribution – moving from pre-internet technologies to more modern ones, such as NDC among others. This will make it more transparent to the traveller what they are buying and allow intermediaries to show the differences between airline products beyond price and schedule."Offering the best flight shopping experienceAs users start to engage more and more with searching, booking and paying for their travel on the applications they use day-to- day, whether that be via an app, messenger or even voice controlled digital assistants, they will increasingly demand the ability to book these services instantly and without friction. This will be true, regardless of whether they find these tickets on a meta-search or an airline’s site, or indeed whether they are sat at home on a laptop or sharing deals with friends in a messenger chat. As an industry, we must strive to offer the richest flight shopping experience for travelers whenever and wherever they need us—and that includes on everything from desktop through to social platforms and in conversations.Written by Gareth Williams, CEO and co-founder at Skyscanner

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