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IATA predicts 45% airline direct distribution by 2021

Date:2016-10-28 21:24Source: ReadingNumber: Times

IATA projects that carriers will see around 45% of reservations coming through their own direct channels by 2021, up from 33% this year.

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IATA is forecasting a fundamental overhaul of airline distribution within five years, shifting to what it calls an “active distribution” model.

The study identified in  a number of likely areas of significant movement affecting airline distribution in five years: 

* New technologies
Airline distribution will need to have the ability to work with and alongside speech and voice recognition software, with artificial intelligence-based processes handling areas such as dynamic pricing and personalisation. Virtual reality will also have to play a part in the allowing airlines to merchandise their products in a way that appeals to potential passengers.

* Airline direct
Carriers are expected to see around 45% of reservations coming through their own direct channels by 2021, up from 33% this year. This will be at the expense of online travel agencies and offline agents, although travel management companies will see a small increase.

* Distribution technology
Processes and protocols created over 50 years by the Global Distribution Systems are based on technology, rather than passenger needs. The IT environments of airlines will clash with “outmoded” technology from GDSs from upgrading to incorporating new product attributes.

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