CAPA Live. Qantas: paused in NDC rollout but robust roadmap ahead

Summary:

• Qantas paused its NDC deployment as COVID-19 struck, but quickly adapted, and retains a robust roadmap for delivery.
• The volumes that are coming through its distribution platform and NDC channel are more leisure-centred, but frequent flyers are the focus for content.
• The Qantas NDC offer is "not just about price", and "would never be just about price", but is about delivering "a better experience" and richer content to travellers.
• Ancillaries will be a key part of the 2021 roadmap as new offers are introduced to indirect channels.

A short pause in NDC thinking…

For Qantas, Nadine Dawood Morgan, head of distribution, recently explained that the airline had to take a short pause in its NDC thinking as the coronavirus pandemic hit and other factors took priority.

"I think 2020 was pretty shocking for everyone, to be honest, and we were no exception. It was absolutely not the year that we thought it was going to be … it's been hugely impactful, just absolutely incredible … we are in a transformation now with our business changing rapidly, and it's been hugely impactful for the country, for the business, for all airlines really", she said.

Speaking during an interview with Will Owen Hughes, head of customer strategy & marketing-Air at Travelport, during the Feb-2021 edition of CAPA Live, Ms Dawood Morgan outlined how the airline had adapted in the complex travel environment.

"We had a lot of momentum already going, and there was a pause, really, across the industry. And I think there were some of our partners that were just in survival mode. Some took a deep breath and went, 'Okay, well maybe this is an opportunity to double down'. And so, we definitely slowed down, we didn't actually stop, though", she explained.

… but the roadmap hasn't changed

That pause was only "short-lived," and Ms Dawood Morgan acknowledged that the airline had actually got up and running again quickly, with some partners eager to accelerate. "We've got our team back on deck, and yes, we've got quite a lot happening", she said.

"I think we've had some partners that have had to slow down a bit, but then we've had others that have accelerated … there's an inconsistency across the industry", she added.

In terms of the airline's roadmap, it didn't really change "because our strategy was very long-term, and we were very focused on modernising that shopping, and booking, and servicing experience", according to the Qantas executive.

A desire to improve the retailing proposition…

The Qantas experience is similar to that considered for many of the airlines more advanced in their NDC journey, according to Travelport's Mr Owen Hughes: "Probably most of the airlines who were already invested in NDC, like Qantas, have been doubling down on that", he said, and recognises there's "still a real desire to improve that whole retailing proposition".

… but there's a need to adapt to the changing traveller demographic

The market is very different now from when Qantas conceived its NDC strategy. The airline is not flying scheduled international flights and only recently returned to domestic markets, and still at a more reduced scale than previously. Also, leisure demand will be dominant in the recovery, with only limited business travel.

"I think the volumes are going to be a bit different, the mix is definitely going to be a bit different, because we have a strong corporate market. But we're really quite confident the corporate market will come back, and we've been quite quick to adapt to what the leisure market looks like", explained Ms Dawood Morgan.

Flexibility to offer across multiple dynamics

For now, the volumes that are coming through QDP and through the airline's NDC channel "are more in the way of leisure", but Ms Dawood Morgan acknowledged that the strategy was never focused purely on a particular segment.

"We've not built our strategy around one segment, it's been about all. And it's probably more about the customers themselves. And so we've got the flexibility to be able to play in either space, and make the most of that", she added.

Frequent flyers a focus of new content

When it comes to the thinking about the content pieces, and the new offers, and what will be released in terms of capability, "a lot of that will be focused around our Qantas frequent flyers. And that is enduring, whether it's corporate or leisure," said Ms Dawood Morgan. "We have 13 million Qantas frequent flyers, and many of them are corporate and leisure customers, and they do both."

One of the content features that Qantas launched recently has been the ability to provide discounts for frequent flyers in the indirect space.

"We've never been able to do that before, so that's very new. And given our programme, and the strength of the programme in this market, that's going to be really core", declared the Qantas executive.

Not about price, but a better experience

Qantas being a "premium carrier", Ms Dawood Morgan said the Qantas offer was "not just about price" and "would never be just about price", but is about "a better experience". Some of the features that the airline is building, and the capabilities, are not about price at all, she contested.

"It's about value add for the customers, and value add for the trade as well, for the agents to be able to get more information", she added.

One example is the ability for customers to purchase carbon offsets and reduce their carbon emissions when they fly with Qantas, a programme that has been operating on the Qantas direct channel and selected by around 10% of travellers.

"We know it's important for our customers, it's definitely important for us as Qantas. And so that's something that's not price related, it's a benefit for customers, and for the agents that can actually provide that to our customers. That has never been available in the indirect channel before", added Ms Dawood Morgan.

NDC solving the COVID travel questions…

NDC can also support travellers, airlines and agents alike to navigate travel more easily in these current uncertain times, says Ms Dawood Morgan.

She said the platform "absolutely can help" in supporting the need for the dissemination of contact details and for contact-tracing purposes, should positive COVID-19 infections be discovered, thanks to its rich content capability. Mr Owen Hughes even acknowledged that Travelport is "looking at building in that kind of attribute information up front" in its own offer.

… and helping add ancillary sales in indirect channels

In the year ahead ancillaries will be a key area for Qantas and its NDC journey. The airline has a number of ancillary products "that we know are really important to our customers, that can't be sold at the moment through the indirect channel, or have servicing elements that need changing", noted Ms Dawood Morgan.

These are due to be incorporated into the QDP, in what will be a key milestone for the airline, although no firm date has been confirmed. "There's definitely going to be lots of fantastic content in the months ahead, and we're releasing things really quickly", she said.