If you work in the travel industry, you’ve probably heard of NDC. It’s usually framed as an alternative to GDSs, but the reality is a little more complex. In a nutshell, New Distribution Capability (NDC) is a new technology created by the International Air Transport Association (IATA) for travel agents. The basis of this standard is to provide travel agents with the tools to give their clients the most up-to-date products and services alongside airfares. The goal is to eventually allow for dynamic and personalized pricing -- perfect for agents who want to provide services tailored to the client.
NDC aims to change the way flights and ancillary products are sold; it was specifically created to improve the communication between airlines and travel agents. NDC addresses the current industry’s distribution limitations, such as product differentiation, transparency, and time-to-market.
So, the goal of NDC is to provide travel agents with streamlined accessibility to products that enhance the traveller’s experience. This helps solidify agents’ role as a service provider, creating a more valuable experience for travellers, all while increasing commission opportunities. Agents having access to ancillary products like baggage fees, travel insurance, wi-fi, and meals also provides value to the airline by increasing customer satisfaction and retention.
How is NDC different from Global Distribution Systems (GDS)?
First, let’s talk about how GDSs work. GDSs retrieve flight information from airlines and then create a ticket for a customer to purchase. This simple-sounding process relies on multiple identification numbers (IDs) from a myriad of sources. These IDs are ultimately reconciled by the airline. So, not so simple. This process is further complicated when ancillary goods and services are added to the booking, as GDSs do not display information about ancillaries alongside their fares.
The booking process, when using a GDS, is fragmented and runs on old technology, causing a lag between available airline inventory and the content visible to the travel agent.
NDC has created a potential solution to combine order information into a single identifier, known as ONE Order. This solution extends beyond NDC’s front-end; it aims to simplify back-end order fulfillment, order management, delivery and accounting. In other words, by removing intermediaries such as the GDS, ONE order makes payments and reconciliations across multiple providers easier.
NDC has endless possibilities for the travel industry. Stay tuned for future blog posts about NDC, how it can be accessed, and how it's quickly changing the industry. If you have any questions or topics you want us to cover, feel free to reach out!