For the last decade, there has been one dominant theme in the corporate distribution debate in aviation: the problem of which distribution standard is most effective. This is a misguided question. The actual issue is not about the mode of distribution used by carriers; it is all about whether or not the airline has the necessary commercial system in place to get maximum yield from the most profitable segment.
Successful carriers have one key feature in common: they now regard airline corporate distribution not as a technology issue but as a commercial issue. The outcome of this shift is no longer an upgrade in connectivity but the creation of a dedicated corporate distribution platform that provides airlines with the control of their most important revenue stream.
This is what ADO Corporate Portal aims to achieve.
The gap that distribution modernisation alone does not close
It is undeniable that the industry has made great strides in changing how airline distribution happens. The level of corporate distribution through modern systems is growing quickly year-over-year, and this upward movement is gaining momentum globally. Airlines have begun exploring the modernization of their retail infrastructure, and the rationale for such investments is obvious.
However, what the story about distribution transformation for airlines tends to overlook is that establishing new airline distribution channels and overseeing corporate revenue generation are two entirely different tasks. Distribution modernization tackles the issue of content delivery, meaning that it helps transport rich offers and ancillary services into the hands of agents but doesn’t resolve any issues concerning contracts, policies, approvals, and performance tracking.
Several aspects of the industry’s concern in reshaping distribution have aimed to focus on bringing into play with the configuration of the fresh infrastructure, while relatively little effort has been spent on such money-making aspects as dynamic offers, policy-friendly bundling, and account-level intelligence in distribution, which transforms distribution capabilities into actual commercial results. Historically, the airlines, which have been succeeding in this gap closure – those incorporating corporate channel capabilities into their airline distribution strategy – are the winners of the race who can turn infrastructure into revenue-producing investments. Those companies, which are not paying due attention to this process, are currently observing the drop of their contracted corporate revenues in the period between RFPs with no vision of how to fix it.
What ADO actually changes
ADO Corporate Portal serves the purpose of embracing the corporate distribution of airlines in general and facilitating a unified way of holding revenue operations that is based on data rather than manual approach. As a result, it becomes easier for the airline’s commercial management level representatives to understand the goals and principles of ADO within three main segments of interest for them.
Revenue integrity at the level of contractual agreements. ADO organizes the management of the contracts between the airline and a corporate customer and automatically applies the specifics of the contract (discount tiers, amount of business excluded from various bonuses, etc.) to all tickets booked by the corporate customer. This creates a more consistent approach to airline contract management and corporate account management.
The commercial control at the level of the offer has been established. ADO incorporates every corporate account’s contract terms and policies right into the offer creation process. Modern airline retailing operates on contemporary offer intelligence principles rather than static rules. ADO provides all needed solutions in the corporate channel – every offer presented to corporate travellers is compliant with policies and contracts and ready for commercial confirmation. Approval processes are handled seamlessly on the platform, allowing the elimination of approval delays that prevent corporations from receiving the best fares.
Strategic visibility at the account level. ADO accomplishes the most important change for airline commercial leaders when it switches annual performance reporting with real-time corporate account intelligence. Commercial leaders can now see which accounts are performing according to contract. Which ones are failing or generating corporate revenue leakage. And what are the travellers booking outside the managed programme. The ability to obtain such information on a daily basis as opposed to once a year at the time of contract renewal allows commercial leaders to make fundamental changes in the way they handle underperforming accounts. Now, proactive work with troublesome accounts has become a priority rather than reactive measures to be undertaken after the fact.
The strategic case for acting now
While modernising airline retailing is one of the most important sources of revenues identified by the industry for the current decade – with the corporate channel being the key area, because it is the most profitable and the relationship-driven segment in airline distribution – the state of demand for B2B corporate travel remains stable and increasing in all essential markets of the world. The channel infrastructure is undergoing rapid maturation. However, it is necessary to find out whether an airlines’ sales infrastructure will be able to seize this demand in full value – or will still be giving away a measurable share of the demand due to leakage, non-compliance with policies and ineffective management of accounts.
The evolution of the airline industry is taking place from a fragmentation of the booking data into a comprehensive format of the function of the sales relationship between the airline and the buyer, conducted with the help of a single unified corporate travel system to fulfill immediate business needs of this area of business. In this regard, ADO serves as a particular and feasible answer to the question of where to make investments into the transformation of the sales processes in the airline and is connected to airline sales and distribution.
Channeling in business does not pose a distribution problem; in fact, it represents a revenue management obstacle that is simply referred to as a distribution issue. ADO is meant to address this issue, which distinguishes it in the market.
