Shearwater Blog

I finished up recently in Part 1 of this post by saying that the really interesting thing was not so much in looking at sites like Lufthansa, Iberia and Travelocity, but in trying to work out where search by attributes was going. And at the same time, trying to figure out who is holding the cards today; and maybe even who will be holding them once the technology matures and the business model of search by attributes evolves?

Personally I’ve always thought that the promise of the original concept of dynamic packaging for airline websites was oversold back when it was all the rage (circa 2006), ie. before ancillary revenue and social networking become the flavour of the month buzzwords. But now with shopping basket technology across various providers being developed, affinity shopping in production, cached data allowing much more powerful search parameters like extreme search, the relative ease of building mashups, and interactive mapping technology so widespread, maybe DP will come back in a slightly different guise. Looking back at that sentence I think they key phrase is across various providers.

The old dynamic packaging mantra that assumed people would just trust the bundled price and all buy packages instead of having purchasing the travel components separately never really eventuated, or at least nowhere to the extent that the OTA’s would have been hoping for. But what has happened is that with search by attributes, we have the beginnings of a very powerful new paradigm in travel search that will almost certainly have big implications for the leisure travel market. Not immediately, but it will come.

Before going any further, I’d recommend watching at least the first half of the ten minute video embedded below. It features Denis Lacroix of Amadeus presenting with Marcus Casey from Lufthansa. Marcus makes an interesting point that LH found 20% of visitors to their website did not actually know where they wanted to go. Denis shows a few slides on the history of search and how it is evolving into search by attributes.

As much of a fan as I am of airline direct distribution, airlines have their work cut out for them in taking control of this sure to grow segment; on the face of it the OTAs are holding more of the cards today. The reason is obvious, as when price is the key attribute on which people are searching, loyalty to a brand diminishes; but even more importantly, total cost of trip is more important than just the flight component. If I’ve got a set budget for a weekend away, it is of less value to show me cheap flights to London, as the chance of me getting a decent hotel that doesn’t blow the budget is somewhere between buckleys and none – well maybe now with the pound sterling at low levels this is less of a concern, but you get the point. For price driven shopping by attributes to really hit the mainstream, packaging will play a much bigger role. Hotels is the first obvious inclusion (as Travelocity have shown), but even that is not quite enough.

To really become big, shopping by attributes needs to be offering something compellingly different to what I can do today online. Those who saw my presentation in Kuala Lumpur in June last year would already know that I am a strong believer in the misunderstood and unloved step-child of the ancillary revenue scene – destination content. I was very interested to see Rezgo are sponsoring an upcoming PhoCusWright report aimed at answering How do travelers purchase activities and attractions and how much do they spend? Think of it as adding context to the trip, and if it is included in the packaged price, and tied into the attributes one has searched on, then when combined with a flight and a hotel, it becomes a travel search experience well beyond what is available today. Especially when through shopping basket technology or similar you are then able to purchase the package without leaving that same site. In this model, the attributes become so much more meaningful than they are today.

To put it bluntly, today’s attributes have a long long way to go before we are at the end game. For example, today I can search by attributes listing museums as my preference. But are there really more than a handful of airports that don’t have at least one museum in the major city or town that they service?  What would be much more compelling would be to put in my maximum price, and have each destination returned with a flight, a hotel (that I could vary by star level using a slider) and one entry ticket to a temporary exhibition at a local museum.  As Stephen Joyce from Rezgo wrote about his hopes on sponsoring the PhoCusRight report:

We will also see large OTAs and distributors looking for ways to connect with suppliers in a big way. This will put pressure on application developers to build systems that easily connect to these distribution channels

So destination content is one part of the puzzle. Another part is more attributes that aren’t dependent upon human whim. I saw one attribute that could be selected was children. What makes one destination more child friendly than another without any knowledge of the ages of the children or what they like is utter guess work. Attributes like this lack credibility and take up valuable screen real estate for no apparent gain. Much better attributes would be things that could interact with a slider, and that also could be populated with data sources that were automatically updated rather than manually maintained. Average temperate at that time of the year, chance of rain, days of sunshine, water temperature – or maybe something really edgy like safety (aka muggings/murders per head of population) or even average age of other people that flew to this destination (difficult to be accurate in domestic). They are all off-the-top-of-the-head ideas without even giving it too much thought, but none are dependent upon human classification. Adding more attributes that follow these rules are potential game changers, and for airlines they have the added benefit of moving their presence to the left of the Bow Tie and into travel inspiration in a big way. But airlines will still be at a disadvantage relative to OTAs unless they can find a basis of competition that puts the ball back in their court – nothing I have written above is sufficiently unique to do that.

It will be a sad day if I ever have to concede defeat on behalf of my airline customers to the OTAs (unless I change tune by working for the other side!), and I’m determined to demonstrate a way in which shopping by attributes can be owned by the airlines’ own websites. Airline.com, by not having to deal with a wide range of air content will be able to maintain a cleaner interface and a much better quality of cached flight availability data. Nothing kills the user experience quite like moving from the cache to the real availability screen only to see the price increase! So this is a start, but it is still not enough of an advantage compared to reduced air content; although a less accurate cache could do more damage than good, so this is certainly a plus for airlines. Just not a big enough plus in itself

Let’s not forget that a lot of consumers have a distinct preference for booking direct. Just look at the evidence of the Expedia billboard effect. Whether that preference will extend to the airline selling on behalf of others hasn’t been proven comprehensively, but the success of white label car and hotel sales using the airline.com brand may indicate the answer is yes. I’ve always thought that airlines undersell the perception passengers have that because an airline flies to a destination frequently they must have credibility with recommendations about what to do and see in that destination. But this is more the Two of Clubs rather than the Ace card. A small advantage, but nowhere near enough in itself to win a game.

A la carte pricing definitely plays into the hands of the direct channel, and even more so when it comes to staking a claim in owning the search by attributes space.  Metasearch finds it hard enough to keep up, and OTA’s will face the same problem. Every time they update airline fees, an airline will create a new one sold only via the web.  Whenever you are touting the search by price capabilities in your engine, you’d better be pretty confident the prices are a fair representation of reality. Airline.com has an advantage here that can’t be taken away. Going even one step further, airlines who get merchandising right will really carve out a defendable lead in search. Getting it right means properly differentiating fare families to such an extent that passengers actually know the differences and will pay for these differences. Air Canada and Frontier have been touting their credentials in this area for a while, but the importance of doing this properly cannot be overstated – even more so when an airline can add a slider with fare families to their search by attributes screen. When prospective passengers understand the brand proposition underlying the airline’s merchandising strategy then search by price will do more than just bringing the low yielding business. I don’t even think that many industry insiders today realize search by price could ever do more than deliver low yield business (as it does today), but with really good merchandising from the airline, I genuinely believe that one day this will be possible.

This post is already getting way too long as is, so well done if you’ve read this far. In Denis Lacroix’s presentation above he refers to Affinity Shopper opening up possibilities for new generation award search, and this one definitely sits in the airline direct sphere. Social networking opportunities tied into an existing airline loyalty program will also help put the balance of power for search by attributes back in favour of the airline. But at the end of the day, merchandising is the killer blow that airline’s need to get right if they want to ward off OTA’s stealing their market share in what promises to be the future of spontaneous leisure travel search, and possibly a lot more.

At least it was according to Oxford University Press USA.

unfriend – verb – To remove someone as a ‘friend’ on a social networking site such as Facebook

If I had have seen this reference earlier, I would have certainly scored myself higher than the woeful 10% mark I gave my 2009 prediction of defriending! The comments in the OUP post above on unfriending are very entertaining as many are debating whether the word should really be defriending, but even more are debating the merits of some of the other interesting new words suggested as inclusion in a new version of the dictionary.

To move onto a broader theme in social networking, I want to bring up the issue of privacy again. I was talking to someone recently who told me his 21 year old daughter and her friends we now limiting their use of Facebook and withdrawing the type of information they used to share because of the changes to the privacy settings recently made by Facebook. I’m not close enough to this one to really make a call based on one piece of anecdotal evidence, but on the surface it makes sense. Some scientist might claim to have proved that 150 friends is the maximum really possible, but Facebook probably has bigger things to worry about with the Federal Trade Commission possibly showing interest in the new privacy settings. Still it hasn’t slowed down their growth at all, pulling further away from the competition in December.

I am a big supporter of privacy, but a lot of people miss the point. Back in February 2009 I wrote:

I’m fed up with people overstating the privacy concerns of the general populace, as it is just not matched by consumer behaviour. True, if you ask a man on the street he will tell you he hates the idea of someone else reading his email, but then he signs up for a Gmail account and lets Google read every email in order to serve him relevant advertising. The key difference is that people are happy to share a lot of personal data if they get something for it, and if they think it is a machine and not a person reading that data.

So with that in mind it was very interesting to see Google on their official Gmail blog write recently that users will be even more closely monitored in order to make Google more money.

To show these ads, our systems don’t need to store any extra information — Gmail just picks a different recent email to match. The process is entirely automated: no humans are involved in selecting ads, and no email or personal information is shared with advertisers.

But I do not expect any backlash at all by the average user regarding this change as people have become more comfortable with this sort of thing; it is a machine and not a person reading the data. When Facebook made their changes to privacy settings they opened up previously private information to actual people that the writer may not have originally wanted to see it. Privacy is so much more a people issue than a machine issue, and this is why I keep pushing the importance of airlines making the absolute best use of the valuable information that already exists on passengers, but that sits largely underutilized by most.

Can you imagine if a headline like my one today was serious. Nobody in their right mind would think this was news worth reporting. So why is the fact that someone had decided to use Twitter and Facebook really that much more amazing?

Where I saw this headline isn’t important, because I have seen the same type of thing frequently from various news outlets recently. Here it is:

Tourism Authority of Thailand to make use of Twitter and Facebook

Wow! How is that any more profound that me saying Airline X will now be using email to send offers to frequent flier members? I suppose they need all the good publicity they can get at the moment to deflect from the news that the former Tourism Authority of Thailand governor and her daughter have been indicted in California for accepting bribes from Americans. The news of Sasithara Pichaicharnnarong’s removal as permanent secretary of the Thai Tourism and Sports Ministry doesn’t seem to have been too well received either by tourism operators in that country.

The sooner we start to look critically at which airlines are using social media initiatives effectively, rather than just regurgitating stats on how great one airline is because they have so many followers on Twitter, then the better off we will all be.

And whilst it doesn’t actually mention social media, it is implied in this Adweek interview with Porter Gale, Marketing VP at Virgin America.

I think there are pockets of the population that are price-sensitive, but I think a lot of people are looking for a great value and a great experience. We’ve also found that 70 percent to 80 percent of people book directly on our Web site. So people are very passionate. I think that prior to our arrival, maybe people were picking on price, but now the issue of brand and product experience has been brought back to the category.

The interview is about getting lots of great publicity with minimal media spend. The PR machine kicks it off, and then social media gives it the buzz and really pushes it out there. It doesn’t directly tie in with the theme of today’s post, but I suppose I just wanted to end on a positive rather than a negative note!

In December Air China and Expedia put out a press release announcing their hotels partnership:

Air China has signed an exclusive partnership with the Expedia Affiliate Network (EAN). More than 100,000 EAN products will now be available to Air China customers across 27 overseas markets.

The product is in production and I saw the Airline World blog doing a quick review on the launch, so I took a look at it myself. I was in China back in September, and the team at AirChina.com were very hospitable – it is always great to meet an airline with rapid online growth and an appetite to really improve the way they sell via the internet. Congratulations to Borden and the rest of the team there on taking another step forward in their online growth.

The homepage of Air China is a fairly standard hotels search interface implementation. What I was more interested in was the flow once I am handed off to Expedia, and whether it is sticky enough to see Air China make some decent commission revenue. I really want to see these guys being successful, and in order to get good conversion rates on the hotel product and thereby earn some ancillary revenue, it looks like they are going to need to gently lean on their supplier just a little more.

Nothing that should be too difficult to fix, but I would have thought one quick way to turn off prospective buyers is to show prices with a caveat on the page saying All Displayed Prices Exclude Tax Recovery Charges and Service Fees. I saw this first on a search for Beijing hotels, so I switched to search on Sydney, but it must be a standard warning displayed across all properties. The concerning thing here is that I then decided to do the same search on Expedia’s own Australian site, and found the exact opposite. I saw identical hotels at identical prices, but at the very bottom of the page I saw the text, Expedia Special Rate totals include: taxes, service fees, and extra guest charges.

Assuming I do actually get past the warning on the Air China version of Expedia’s  white label site at travel.ian.com and then proceed to payment, I am redirected to a new URL at http://www.travelnow.com to commence the payment process. I know that payment pages are often hosted at a different site, but making it so obvious to the user can be disconcerting for some people. A much bigger point of confusion came from the fact that despite being told on numerous occasions on the previous two pages that my price for the Travelodge Hotel Sydney was AUD$105 plus taxes etc for the night, on this page I am now told the following.

Total Charges A$105.00 AUD (including tax recovery charges and service fees)

In some ways a nice surprise, but I wonder how many people have dropped out of the hotel booking flow before reaching this point, or how many drop out now feeling like they really don’t know what they are buying or from whom. As I said earlier, these shortcomings should not be difficult to fix, and in my opinion making these few small changes, along with enhancing the timing of the offer, will have a noticeable positive impact on hotel sales via Air China’s website.

I’m travelling to the historic walled city of Ávila today for an internal work conference, but in the true spirit of breaking down the walls and getting closer to airlines, I have to leave early to attend a customer workshop in Amsterdam, so will miss dinner and the second day.

The point about breaking down the walls is not really on the agenda, but if I had been writing it, that would have been an irresistible pun.

Those that saw my 2010 predictions would know that I expect data to play a bigger role this year for airlines in better understanding and getting closer to their customers. I mentioned American Express then in relation to the work they are doing with Leading Hotels of the World, and I’ve recently seen them mentioned again in relation to working with Delta in a similar area.

The company [Amex] recently launched a business insights arm, which aggregates transactional data to help clients segment customers. While the two launches are not related, Hamouly [American Express spokesperson Mona Hamouly] said that American Express is exploring various ways to help its clients acquire and retain customers. “The timing [of the launches] is more coincidental than anything else, but what both new divisions have in common is that we realized we had assets, information and expertise in areas outside of just being a payment processor,” she said.

Another wall is the one that blocks effective communication – for example, just assuming it is someone else’s job to take care of an important task. Very embarrassing situation for South African Airways over the weekend with the website going down due to a failure to renew the flysaa.com domain name.

Virtual walls can be just as effective in blocking progress as walls that are nearly 1,000 years old if you let them; and that is definitely enough clichés for one day!

Continental and Southwest both reported quarterly financials last week, but after seeing some comments from Dennis Schaal regarding Southwest, I decided to read the analyst transcript in full on Seeking Alpha. It definitely contained a lot of interesting information.

Firstly, some numbers on recent ancillary revenue initiatives.

Our Early Bird [priority check-in and boarding] revenues which are included in “other revenues” were approximately $13 million in the fourth quarter. Our business select revenue in the fourth quarter held steady at about $18 million and for the full year was $72 million. In addition to that we generated over $10 million in other revenues for our new pet fare, unaccompanied minor charges and excess heavy bag fees.

From CFO Laura Wright

I am not sure we have given any real guidance out there. We definitely saw a nice increase in our other revenues per passenger in the fourth quarter and we have a lot of initiatives we still have underway with Southwest.com. We have talked about some of the things we have to improve our sales, cars, hotels and so forth. That work is still in the plan. So we think there is a significant opportunity to increase our other revenues per passenger. I am just not sure we are ready to give you a target yet.

And then followup comments from CEO Gary Kelly

I agree. The only thing I think that we have done some modest things on the ancillary revenue area this past year with Early Bird, pets, the much needed fee for unaccompanied minors. The big opportunity out in front of us is with our Rapid Rewards program. We are looking for a very significant revenue contribution there. Off the top of my head I can’t convert that to a per passenger target but I can at least tell you where the source of the increase in ancillary and that is clearly within our frequent flyer program.

Back in April 2009 the financial community wasn’t buying into the Southwest no bags strategy. Virtually every stock analyst was betting against Southwest’s ability to benefit from their stance on bag fees, and they were all guessing when Southwest would cave in and follow the crowd. At that time I wrote:

But the point with Southwest above is that as much as the incremental revenue from a la carte fees will be a good thing for the airline industry, there will always be branding positions that if well enough defined and properly appreciated by consumers, mean that one or a few airlines can go against this trend, and maybe even benefit.

Almost a year later, and now we have this vindication from Gary Kelly

I think you should cheer on our competitors to charge really high bag fees and you will continue to see record load factors at Southwest Airlines. Again I will repeat that we reduced capacity in the fourth quarter 8% and at the same time we grew our passengers, grew our RPMs and achieved record load factors. It is very clear we are seeing a share shift. Those are the facts. My guess is and our folks have made several different calculations on this but it all sort of points to roughly 1% share shift in the domestic US which is huge. Somewhere between half a million and $1 million worth of additional customers. That is what we are trying to do. We are trying to win more customers and we would love to sell them more stuff. So we have all that work underway as well. We are not going to be charging for bags. I hope they charge $100 per bag. That would be terrific. We will have 100% load factors. It would be great.

In recent weeks I’ve been  starting to see some travel industry writers use the term merchandising in a way that could confuse it with a la carte fees, and in some cases implying it is synonymous with ancillary revenue. Where I see the difference is that merchandising is much more than ancillary revenue. In my view, airline merchandising is making passengers understand and value the differences between branded fare families, thereby facilitating upsell into higher fare families. The competitors of Southwest should have seen this coming, and should have been using their lowest fare family as a fighting brand – a fare family that was unbundled to the extreme. But to unbundle every fare (or close to it), that would be a case study in very poor merchandising for any airline other than a pure LCC play. In fact I’m surprised to hear Ryanair even use that term, albeit in a different context.

Back to the Southwest analyst call, and Daniel McKenzie from Next Generation Equity Research mentioned something I was not previous aware of.

I know on the website when you book your ticket one of the questions that Southwest prompts everybody buying the ticket is whether the trip is for business or for leisure.

CFO Laura Wright implied that they were doing 18% of revenue in the full fare category, down from 24% a year ago, but as we all know, plenty of business travellers buy discounted and restricted tickets. Actually having the passenger indicate the nature of their trip would give Southwest some pretty powerful marketing data to play with; especially as she also indicated above the current work Southwest are doing on increasing ancillary revenue from car and hotel sales. But the best quote of the call has to go to CEO Gary Kelly when asked by William Greene of Morgan Stanley what he now considers normal:

Flat is the new up.

Thanks to Jared Blank for pointing me to this recent story in The Copenhagen Post called Donald Duck stunt hits airline.

Hundreds of fake names appear as no-shows after purchasing cheap tickets on competitor airline’s new route. Airline Cimber Sterling has been accused by its domestic competitor Norwegian Air of buying all its special offer tickets on a new route under fake names to prevent ‘real’ customers from taking advantage of offers.

The story makes for a very entertaining read, but the most interesting part for me was that it got me rethinking the long held skepticism I have held regarding the value of revenue integrity processes in  airline direct sales channels, especially the website. I’ve never questioned the huge value an airline receives doing revenue integrity on travel agency bookings, but when booking creation and payment occur at the same time the value seemed less obvious.

So I consulted Tony Dinsdale, the man I know who is more knowledgable on revenue integrity than all others, and between tuk-tuk rides in Bangkok he found time to answer my email on the question of why airlines should take direct channel revenue integrity seriously. Below are some of his key points.

In general, the reasons for performing revenue integrity on direct channel bookings are the same as the reasons for doing so on indirect bookings. The differences are that airline employees frequently know of more loopholes than the indirect channels do. For instance it is too common to find employees making multiple bookings on the airline’s website (where they can be anonymous) in order to secure space for standby travel. Airport staff also tend to create bookings to close out flights for sale so they don’t have to deal with oversales, or make bookings for their friends and circumvent the last ticketing date.

Some examples of revenue integrity processes relevant for direct channels:

1. Detect fake names – may indicate fraudulent use of a credit card, or at least catch the Donald Ducks in the above example.
2. Credit card velocity checks – another way of catching the problem in the above story
3. Dupe check – Detect multiple bookings made by accident if the passenger thought there was a problem with the website when in reality the booking went through OK. Related to this we found a special duplicate case where multiple PNRs have automatic tickets and upon investigation it turned out that some passengers were actually ignoring the warning that says DO NOT HIT YOUR BROWSER’S BACK BUTTON at critical points in the booking flow.
4. Enforce time limits for bookings placed on hold on the website or in the call centre – this will also catch errors, not only blatant abuse.
5. Free up inventory where passenger talks to travel agent who creates a booking, but then passenger books and pays on the airline’s website – another example of using the dupe check.

My skepticism on this topic has evaporated:  revenue integrity ensures that more bookings are productive bookings, and it applies to the website just as it applies to other channels. And one more point to consider; in this age of ancillary revenue, revenue management of ancillaries is becoming more important – just look at Allegiant. If the plane is not full of passengers, even if they are travelling on heavily discounted fares, then where is your cross selling revenue going to come from?

My post on the Tiger Airways booking flow was less than a week old, but recently when I looked at the most page views of any post in the past 30 days it came out on top (assuming you don’t count the home page).

Here is the list of the most popular posts by page views in the last 30 days.

Just to show that I do sometimes listen to feedback, it is obvious that I should be writing more posts like the Tiger one, and less like the one on ticketing that I put up yesterday! So with that in mind, let’s revisit the topic of booking flows, and talk about what I consider to be the most innovative area in search today – search by attributes.

I should make it clear that I am using a pretty narrow view of search here. I’m not writing about all the interesting stuff happening with location based search, human answered travel search, or the plethora of other innovation happening in travel search that doesn’t directly manage air booking fulfilment. So with that narrow definition, it pretty much leaves airline websites and OTA’s within scope of this post.

With that in mind, I took a look at the Lufthansa implementation of Amadeus affinity shopper, Iberia’s development of similar functionality, and the search by attributes functionality on Travelocity.

Starting with Lufthansa, I would recommend visiting their UK site, as this feature hasn’t been rolled out across all sites yet. They might have just been awarded Best website for business travellers, but today I’m more interested in the leisure traveller. Look for the link named Trip Finder at the bottom of the page, or Budget Trip Finder in the right side panel. As it is my own employer building this product, any positive comments from me can sound a little hollow, so best if you take a look and judge for yourself.

Checking Availability

After choosing your destination airport you can see on a map all the flights within your price range. With the use of a slider you can adjust the price range accordingly. The user has the possibility to search by attributes other than price, such as diving destinations, but it is clear by the name LH have given affinity shopper, that price is really the attribute most people are expected to use. One feature I’ve never seen elsewhere is their wait screen shown here. It was displayed whilst moving from the map page to the actual availability page. I had selected a flight from London to Oslo, so whilst at first I thought it was similar to the Amazon “people who bought this book also bought these books” feature, it could be just a static screen advertising the fact that LH fly to Hong Hong and Korea. Interesting idea, but it would be really powerful if an airline implemented the sort of logic saying “of the other people on your flight, or flying to your destination, the following hotels were most frequently booked.”

Iberia built their own cache, initially to better populate landing pages to feature higher in organic search results, but have now extended it to offer a similar search by attributes functionality. The screen shot above shows a search using Madrid as the origin. Very nice touch to have the date flexibility options as part of the search, and also interesting that they try to upsell me flights slightly above the €120 that I entered as my limit. I’m not sure why the session times out using what appears to be the same parameters as set for the booking engine, as when displaying the map they wouldn’t be reserving inventory for a prospective customer due to the use of the cache. Therefore time outs seem unnecessary until you move into real-time availability, but maybe there are other valid reasons for doing this.

Next up was the the Travelocity implementation of their version of searching by attributes. I was alerted to this feature by a great post from Hudson Crossing. When I used it myself it wasn’t all smooth sailing, but I really like how they show content both with flight + hotels, and for flight only. Travelocity are calling their version of search by attributes Deals on a Map, and my first impressions of what they are trying to achieve were extremely favourable. But rather than do an in depth review of this site either, I’d prefer to focus on why search by attributes is important, and where I see it going.

But that topic will have to wait for another post, and a later date. In the meantime, take a look at the three sites mentioned above and decide what you like and dislike about each.

Part 2

It’s been quite some time since I wrote the first part of this two part post. The truth is I’ve just found plently of more interesting topics to discuss, and therefore this second part kept getting bumped down the list. Just as I said when I wrote part one, this isn’t going to be a riveting reading for most, in fact it will probably be drier than an AA meeting, and I’m not referring to American Airlines.

To set the scene I’ll repeat one thing I write in the original post.

The core theme for me, and the biggest factor influencing my preference, is that realtime critical applications (ie. the website) should be built with less points of failure. More importantly, the smallest complexity/functionality added to the online booking flow should only be done so if it has the potential to improve the chance of increasing airline revenue (or in some cases, but more often post booking flow, reducing the cost to serve).

I’ll start with the case for doing the TTP/ET entry on the booking confirmation page, ie. during the booking flow. And it is still the booking flow, as even though the air booking is confirmed, in a flights plus model of ancillary revenue, the entire booking is not yet finished.

Online Ticketing – Pros

1. e-ticket number seen immediately by passenger (not sure how many passengers even understand this or see it as a benefit)
2. Web check-in is available from confirmation page for last minute purchases

Online Ticketing – Cons

1. Higher (visible) ticketing failure rate, resulting in more work for back office / call centre
2. A ticketing error on the confirmation page leads passenger to think there is a problem with a booking, and duplicate bookings may be made causing extra back office work doing refunds
3. A ticketing error on the confirmation page virtually kills any chance of an immediate subsequent sale of a car or hotel segment
4. Possible confusion for customer by having both e-ticket number and RLOC number displayed (extremely minor issue, compare to above)
5. New tickets can’t be issued whilst sales report is being closed, causing more ticketing failures, especially for high volume sites.

Offline Ticketing – Pros

1. Multi retry solution – in the event ticket issuance fails on the first try, the PNR can be requeued and retried at set intervals (very helpful if link down) rather than automatically queued for manual rework.
2. In the above case, subsequent error investigation is eased due to a single back office processing path
3. Related to point above; true cost of each sale can be more accurately measured if the same platform doing the ticketing is also measuring subsequent PNR touches from buy to fly.
4. Pre ticketing checks can be performed such as passenger blacklists and light fraud checking prior to ticket issuance
5. Pre ticketing reformatting of the PNR – eg. sometimes the airline may want certain remarks converted to SSRs OSI’s etc, especially when working with the growing list of ancillary services sold during the booking flow
6. Booking confirmation page is lighter with less complexity, especially non value adding complexity – and more screen real estate on this page therefore is available for cross selling and upselling
7. Probably the strongest reason of all is the extra revenue that would be missed by not implementing what in my opinion is a major plank in the best model for cross selling hotels

Offline Ticketing – Cons

1. The two pros for online ticketing appear here as cons. Customer doesn’t immediately see ticket number and also can’t check in from confirmation page. If having the passenger wait a minute or two for the ticket number in the itinerary receipt email they receive is a problem, then this is a big negative.

As you probably gathered, my preference is for offline ticketing, but as I said in my original post on this topic, the question of online versus offline ticketing is hardly one of the biggest questions an airline e-commerce manager will need to answer whilst doing the job. There are plently of bigger fish to fry.

Short post today, but just one highlighting what can happen if you are not careful.

United Airlines is being fined $30,000 for failing to include a federal tax when it quoted some airfares on its Web site. The government says the airline omitted a 7.5 percent federal excise tax from some search results online.

Seems a bit harsh, but then again I don’t know the full facts and besides, $30,000 is a drop in the ocean for United, who by the way have recently hired Tom O’Toole from Hyatt as their new Chief Marketing Officer. Despite the relatively small fine, I still wouldn’t want to be the person responsible for the error.

In a strange co-incidence I leant a new word today, or at least a new definition for the word cougar; from two different sources, and both in a tourism context. Carnival cruises are saying no more cougar cruises, and Air New Zealand have a viral video on the topic. Very strange co-incidence. 

Finally, I made a small tweak to the website over the weekend to make comments more prominent on the homepage of this blog. I was getting some really good comments recently from people in the industry, and in the past you had to click on each old post to read what had been written by others. I still can’t work out how to set up a Feedburner or WordPress RSS feed that only contains comments from others and not my replies to their comments, but I hope you find this small change a good addition to the site.