It’s been a week since Lufthansa and Click Travel announced the successful implementation of a direct connect solution and in that time comment on the future of corporate travel distribution has certainly increased, with this exciting time of change motivating prominent voices within the business travel industry to share their opinions.
A comment that has certainly attracted a lot of attention was that made by Paul Wait, chief executive of the GTMC, at the start of the week, in which he voiced his concerns over direct connect deals with TMCs. Although GTMC clearly feels strongly about these changes, I believe that this statement is in danger of ignoring the extremely positive aspects of the future of distribution. So, let’s have a look at some of GTMC’s concerns in detail…
“Our overarching concern is that a direct connect between TMCs and airlines does not offer a positive, efficient customer experience.”
The motivation behind implementing a direct connect with Lufthansa was certainly not to avoid the 16 Euro distribution charge. Sure, that was one compelling reason behind the decision, but the main driving force was that connecting directly gives us the ability to further enhance the current customer experience – something that we’re always striving to find new, innovative ways to do at Click Travel. And that’s the same for all of the direct connects we have today – it’s all about the customer experience.
“The direct setup does not make comparison shopping and best value easy for the customer therefore bringing no tangible benefits.”
The easiest way to illustrate that there really are tangible benefits for customers who have access to direct-connect-only content is with an example; sign up for travel.cloud (it’s free!) and do a flight search for any Lufthansa route. You will quickly be able to see for yourself how GDS and direct content is transparently mixed in the results, enabling seamless comparison shopping.
“In fact, the long-term effects of inefficient fragmentation are incredibly damaging.”
travel.cloud customers are currently benefiting from no distribution charges this very second – gaining parity with Lufthansa’s direct pricing and exclusive direct-connect-only content whilst still enjoying transparent, seamless comparison shopping with GDS content, so direct connect is certainly not damaging to them.
Direct connect deals will definitely change how TMCs work commercially and Click Travel is ready for this – in fact, we’ve been preparing for this for a while.
“The primary booking tool of TMCs is the GDS and anything outside of that has a negative impact on productivity.”
This is a very valid point and the GTMC are right to be concerned about this on behalf of their more traditional members. These changes will challenge TMCs who lack the technical infrastructure to adapt, but it’s also a great opportunity for those willing to embrace those changes.
“The inevitable knock on effect is the cost to the customer increasing.”
Absolutely not. The commercials of TMC2.0 (if you will) are such that there will be no increase in cost to the customer – in fact, we’re already reducing the fees our customers pay us on the back of direct connect technology.
“TMCs must offer an efficient and cost effective corporate travel service with wide-ranging choice and variety.”
We wholeheartedly agree with this!
“Put simply, a TMC cannot satisfactorily service the complex requirements of the corporate customer without the GDS, and therefore the vast majority of professional TMCs will continue to use it. Any prediction for the future that says otherwise and envisages TMCs aggregating themselves is far removed from the management information, reporting, duty of care and cost effective service required by the clients of a TMC.”
This implies that it’s impossible to provide management information, reporting, duty of care and a cost effective service if you are aggregating content rather than depending on the GDS, however Click Travel are evidence to the contrary, as we’ve been doing precisely this for years.
From search and book, to billing, reporting, analytics, traveller tracking, security services, and third party data feeds – none of what we do depends on the GDS, hence it all works seamlessly with whatever content we aggregate.
We’ve achieved this because our vision has always incorporated and embraced the potential of direct connects. As such we’ve built a future-proof technical platform whose services are agnostic to the source of content.
For more details on Click Travel’s direct connect solution to LH Group content and travel.cloud as a business travel platform or for further comment from Simon McLean then please contact Alice Tew at email@example.com