American Airlines has recently rolled out a commission program aimed at promoting New Distribution Capability (NDC) bookings. This new initiative offers travel agencies a 10% commission rate for NDC-enabled bookings of American’s Main Plus, Main Select, and Flagship Business Plus bundles.
The specifics of this commission program were first revealed in The Beat newsletter, where anonymous travel agency sources shared details from a memo they had received from American Airlines. While the airline has chosen to remain tight-lipped about the program, reports suggest that it has already been implemented and will run through the third quarter.
American Airlines made a significant shift in its approach towards NDC-enabled bookings, as indicated by the removal of the chief commercial officer Vasu Raja, who was the mastermind behind the airline’s controversial distribution strategy. This change in leadership signified a change in direction from punitive measures towards rewarding agencies that choose to book through NDC.
Under the new program, American Airlines is offering three distinct bundles – Main Plus, Main Select, and Flagship Business Plus. The Main Plus bundle includes benefits such as Main Cabin Extra or preferred seats and a complimentary checked bag. Main Select offers perks like refundable fares, same-day flight changes, priority boarding, priority check-in, and the choice of all seats in the main cabin. On the other hand, the Flagship Business Plus bundle is tailored for long-haul flights and includes a business-class seat, access to private check-in areas and expedited security screening, as well as dining privileges in Flagship Lounges.
Despite the introduction of this new commission program, travel agencies have expressed mixed feelings. While some have welcomed the incentive, others have criticized American Airlines for their previous strategy, which led to significant backlash from industry stakeholders. Several advisors have pointed out that rebuilding trust with the airline will be crucial moving forward.
American Airlines’ decision to launch a commission program for NDC bookings marks a pivotal moment in the airline’s distribution strategy. By moving away from punitive measures and towards rewarding agencies, American aims to incentivize more bookings through NDC-enabled channels. However, the road to redemption may be challenging, as the airline will need to work towards rebuilding trust with travel advisors who were negatively impacted by their previous approach.
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