Airlines Diverging On Custom Corporate Bundles

By | March 16, 2017

Delta Air Lines in 2015 started offering tailored packages of products and services to corporate accounts. It’s not doing that anymore. It has other ways to enrich commercial relationships with add-ons. The change in strategy reflects two different ways airlines view the concept of corporate bundles.

Travel managers for a while talked up the idea of fares specific to their companies that include extras useful for their travelers. It would help them show value and avoid ancillary spend-tracking headaches. When booking trips or submitting expenses, travelers would be clear on which supplemental services were in bounds.

Travelport has been providing related functionality through its merchandising suite of services. CEO Gordon Wilson during a Feb. 21 interview said the company has seen “progressive uptake in line with two things happening.” One is travel management companies adopting the latest agent desktops, like Travelport’s Smartpoint. The other, he said, is corporate booking tools coding to APIs.

Travelport global product and marketing head Ian Heywood said the company has been testing the provision of bundles through some of those booking tools. Agents using desktop systems other than Smartpoint can access the distinct corporate offers through Travelport’s Universal API, he said.

“One of the biggest problems is, the airline and the corporate can do a deal but is the agent aware of it?” Heywood asked. He pointed out that airlines can craft special products and pricing for agencies, too. For example, Travelport materials indicated that Air India presented to U.K. travel agents the opportunity to add limo service to business-class bookings.

Amadeus since early 2015 has offered airlines a tool to personalize the corporate travel experience. Using Altéa Corporate Recognition, an airline can specify which airport and inflight benefits should be provided to a given account’s travelers. A spokesperson noted that the tool now is integrated with Amadeus systems for corporate agents and the Cytric self-booking tool. Lufthansa was an early adopter. Amadeus said “several” other European carriers use it while airlines in other regions will implement this year.

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Lufthansa also is working to provide customized corporate offers via direct connections.

Finnair “recently” took a first step toward corporate bundles, according to an official. It was for the carrier’s “economy comfort” product, normally sold as an ancillary. The official said corporate interest in economy comfort has been stunted by policies that disallow separate ancillary purchases and by the “complicated TMC buying process.” Now, though, Amadeus agents can book it for clients more easily than they could before. The airline is working on bringing the functionality to Sabre and Travelport agents.

A next step is wrapping Wi-Fi into corporate fares for long-haul flights. “Later in 2017,” according to the Finnair official, “we will be able to tailor bundles that match each corporate’s needs.”

Farelogix CEO Jim Davidson is a fan of the bundle concept. He envisions personalization based on many dynamic variables. For example, a traveler going to London for a meeting on a Tuesday would be entitled to a certain set of services, based on airline inventory. Those services could be packaged in for free as part of the corporate fare, or at an extra but discounted cost based on negotiations.

That vision is part of the promise of IATA’s New Distribution Capability.

The Farelogix Sprk agent tool has an NDC API underneath it. Some corporate buyers “love it” when they see how the system brings in content, Davidson said. “But corporate booking tools say, ‘Great, but I take everything from GDSs.’ ” Providers of those tools, owned by GDS companies in a few notable cases, “don’t seem to be willing to make connections outside of the GDSs to get this content,” he added. (Some online booking tools have had trouble accessing standard bundles, even when made available in the traditional GDS channel). Farelogix is getting the content via direct connections to Lufthansa and others.

Other developments apparently have lessened the desire for specialized corporate packages. At least in the United States, the big airlines have been adding standard benefits to commercial deals without negotiating them individually. Delta through its Edge program, for example, provides priority boarding and standby, more favorable upgrade positioning and other advantages.

“Travelport gave us a framework for supporting branded fares which could be part of a corporate contract,” a Delta official explained. “Now, though, Delta offers branded fares and access to Delta Comfort Plus and first class directly through our TMC partners.”

The official confirmed that Delta no longer is crafting custom deals like it did in 2015 for client Micron Technology, which included lounge access and paid seats.

American Airlines and United Airlines also aren’t currently customizing baskets of products and services for specific customers. “We don’t have information to share on corporate bundles at this time,” according to an AA spokesperson. At United, “what is available now is available to all via united.com,” an official wrote.

The Big Three also have been developing online portals for corporations and TMCs to manage soft-dollar points. Through them, accounts can allocate points for a particular perk for a particular traveler. Some small business programs offer the same for non-contracted accounts.

At JetBlue, the corporate sales team hasn’t seen many requests for custom offers, according to a statement from corporate sales director Robbie Mehoke. “The top needs, like free Wi-Fi,” Mehoke indicated, “are already included in the fares without additional charge.”

Then, of course, there are elite status tiers within frequent flyer programs. Those give a free checked bag and other perks to travelers. Very frequent travelers earn such status themselves. Companies including Relx Group also work with airlines to grant elite status to senior employees.

“We are simply asking our travelers to buy lowest logical fares at the time of purchase,” said Relx global travel director Jim Sisco. “The things they would get in a bundle they are getting anyway, mostly based on elite frequent flyer status.”

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