Tuesday, June 30, 2009

The Demise of Clear

As a frequent traveler I am quite frustrated with the demise of Clear, the registered traveler program. I just signed up for Clear a few months ago and I only got to use it a few times. I believe the concept was good, but the execution was very inconsistent. For example, in San Francisco, the Clear lane merged into the normal security line rather than the FC priority line. So though you were a priority traveler, you had to wait while families and their strollers navigated through the security process. In addition, rather than being a self-service, the Clear personnel basically took my card and put it into the machine. I am sure this was designed to assist first time users, but definitely added to the cost of their service. The best experience I had with Clear was at Dulles Airport in Northern VA. In fact with all my work with the DTMO and GSA, I intentionally signed up for Clear knowing that it would be of value at Dulles. The Clear check-in line was downstairs and saved me at least 30 minutes fighting the mobs on the normal security lines. The way Clear simply shut down without notice will make me very reluctant to every sign up for a registered travel program again. In addition, as a Global Service member of UA, I am able to bypass the security line and allowed to cut into the FC line (though I always feel guilty when I do so!).
As mobile boarding passes become the norm over the next few years, the airport security process should set up dedicated lines for mobile boarding passes as the TSA staff at the various airports will need to be trained to accept the mobile bar code. Considering the fact the TSA process is not standardized across all US airports (for example some require you hold your boarding pass in your hand, others don't and some look at boarding pass while others don't), the implementation of the mobile bar code boarding pass is bound to have some problems.

Tuesday, June 23, 2009

Travdex


I am pleased to be helping my colleagues at PhoCusWright with the launch of the brand new technology tradeshow Travdex, May 5-7 2010 in Atlanta . Some may simply say, why does the travel industry need yet another tradeshow? Each of the segments- airlines, hospitality, corporate, cruise, traditional travel agencies, online travel companies, all have conferences and tradeshows. The question, in these tough times, are these traditional conferences worth the investment for the buyer and the seller? What makes Travdex different is the fact that it is solely an appointment driven buyer/seller marketplace for every aspect of technology covering all sectors of the travel industry. No matter the economic climate, businesses still need to sell their products and buyers need to source and select systems.

As part of my consulting practice over the last 14 years, I have led many procurement efforts for new reservation, customer management and infrastructure systems. These efforts have been for many different sectors including: resorts, travel management companies, wholesalers, online travel companies and the US Federal Government. The first step in procuring anything is to source suppliers. Sourcing is now a global exercise as the right solution may be from a company outside your geographic area. Tradeshows can be an important element in the sourcing process, but from a buyer viewpoint trying to get some time at a crowded tradeshow with the right vendor can be a frustrating experience. From a technology supplier perspective a recurrent problem at most tradeshows is sorting through the foot traffic to uncover the real buyer. Technology companies can spend days at tradeshows giving demos, but often have trouble equating the traffic with concrete sales. The goal of Travdex is to change the tradeshow experience. How do I know it will be successful? Travdex is being put on by PhoCusWright, a company that has reinvented the concept of a travel conference. If you ask anyone in the travel industry they will tell you that the PhoCusWright Conference in November, is a must do event bringing together the innovators and leaders in the travel industry. This is why I know Travdex will be like no other tradeshow before it, bringing technology buyers and sellers together for an intense two days where deals will be made. I encourage all travel suppliers to sign up now to take advantage of early bid discounts.

Wednesday, June 17, 2009

Datalex Users Conference





Last week I was in Dublin Ireland to participate in the Datalex Users Conference. Datalex is a long time client of Travel Tech Consulting. The conference has a small number of attendees (50-60) consisting of Datalex customers and prospects, but the quality of the attendees and depth of the sessions was very impressive. I had the pleasure of siting next to Jim Young who opened the conference with some provocative observations about industry trends. Jim, most recently of Frontier Airlines can truly be called an industry pioneer. At Frontier he was instrumental in implementing fare families, at IHG he was the executive that pulled inventory from Expedia and then renegotiated a new agreement which included a mix of content and advertising benefits and while at Continental he pioneered the direct distribution model during the turbulent 2005 period. Also in attendance was Mark Rosenberg who recently left Air Canada, where he redefined the distribution landscape with the idea of a fare family and pushed the GDS to accommodate this new model.
Day 1 was all about ancillary revenue. Jay Sorensen, President of IdeaWorks presented the results from a new Ancillary Revenue Guide that he just published. The discussion was lively with different airline executives from American, Continental and Frontier debating the various approaches to ancillary revenue. As an observer, I had to comment that all these ancillary revenue strategies often result in a single customer reaction, paying for services formally free (baggage, meals and in the case of Ryan Air on board toilets!). There is no question in my mind that this current focus on ancillary revenue represents a permanent change in the way all airlines market their product. Fare families (also known as branded fares) breaks the long held practice of yield management by associating services with different fare categories regardless of seat class availability. This will likely impact all sectors from distribution (how GDS and intermediaries display these fare groupings) to corporate travelers (will corporate travel negotiations now center around services as much as discounts?) and even meta-search as the Kayak and Fly.coms of the world struggle with showing airfare comparisons when branded fares associate price with service characteristics.
On Day 2 I gave a talk on mobile. By the response of the audience I realized that the airline executives still do not get the impact of mobile. The main response was about how difficult it would be to sell a mobile project to airline senior management. This was an odd discussion from my vantage point as the prior day's focus on ancillary revenue ties directly in to the opportunity with mobile. It looks like the major carriers will have to catch up on the mobile revolution and risk the possibility that a new intermediary will emerge on the mobile platform adding additional distribution costs and separating the end traveler from the supplier once again.

Update

I just completed an exhausting two week trip to the Middle East (Kuwait and Saudi Arabia), Dublin, Ireland and Washington DC. I thought I would create some short blog entries about each of these trips.


First up, my first visit to the Kingdom of Saudi Arabia (KSA). My client Al-Tayyar is one of the largest travel companies in the KSA, the GCC and througout Africa. I was hired by Al-Tayyar to evaluate their internally developed ERP system and to comment on their soon to be launched IBE. Obviously, there is a level of confidentiality that prevents me from talking about their systems in any great detail, but in general I found the systems to be very impressive. The main point here is that Al-Tayyar has embraced the concept of dynamic pricing based on customer value. This is approach maximizes agency profitablity while recognizing the value of different customer types and forms of payment they use. This relates directly to the agency's bottom line and is a type of customer management which is ahead of much of the global travel industry. The IBE system they have built has a multi-source structure and allows customization of packages dynamically. I was very impressed with both these systems, but I did realize they were built around requirements that were very specific to the KSA market. The sytems were built in partnership with Interglobe Technologies a very experieinced Indian travel software company.