It is supposed to be better than the Global Distribution Systems in place at present. It is also supposed to be better at allowing personalization of services. In addition, it is expected to be better in a lot many other ways discussed below. This is the New Distribution Capability (NDC) of IATA, which is initiated not as a competitor to the present GDSs but developed to work along with these, providing more alternative distribution channels for the airline seats. Getting curious? Let us have a look at what is NDC is all about?
NDC is the result of the fast changing distribution game, as perceived by IATA. The experience of looking for the cheap air tickets on the websites of the airlines, agencies and third-party distribution channels, since the airlines have their inventories spread on these channels, is expected to change in the near future, 2017 to be precise. It is these expected changes which form the rationale for NDC. The most important change, as per IATA, will be that the distribution of seats, which is currently understood as a process, will change to commerce. This commerce will be value-based and channel-based. The airlines will have to develop its own commerce team and not merely rely on the push of selling inventories to the different channels. It will have to proactively seek relevant channels of commerce and technologies, work with other relevant groups such as customer insights, pricing, etc. and incorporate third-party experiential elements in ecommerce platforms like the way the search engines and social media networks function. As IATA research studies indicate, the airlines major revenue streams will be from direct channels, much to the disadvantage of the online travel agencies.
Viewed in the backdrop of this research and the expected changes in the patterns of flight booking, the distribution of inventories will change as well. So, what will these changes be? The NDC will focus on:
1.Connecting through common API.
2.Use authenticated shopping for personalization and product differentiation.
3.The first focus area will be the shopping domain, thereafter this NDC will have the ability to interact and provide tailor made solutions.
4.This will enable working on a shopping cart approach, making the users add or remove the products.
It has been clarified by IATA that the NDC is not aimed at circumventing the GDSs route or approaching the customers directly.