American Airlines’ recent decision to prioritize direct bookings and agency bookings through New Distribution Capability (NDC) has sparked a range of emotions within the leisure travel advisor community. From anger and angst to acceptance, travel advisors are coming to terms with the changes imposed by American Airlines. The decision to cease awarding AAdvantage miles and loyalty accrual points for bookings made through non-“preferred” travel agencies has left many feeling the impact of this strategy on their businesses.
One key point to note is that this initiative targets leisure agencies primarily, as pointed out by Cory Garner, a former NDC strategist at American. While exceptions are made for bookings related to contracted corporate travelers, the focus remains on leisure agencies to comply with the new rules set by American Airlines. The shift towards preferred agencies requires a certain percentage of bookings to be made through NDC, setting progressive thresholds for agencies to meet by specific deadlines.
For leisure travel agencies that have been hesitant to embrace NDC-enabled bookings, meeting the thresholds set by American Airlines poses a significant challenge. Especially for traditional agencies reliant on GDS interfaces, the transition to NDC bookings may be difficult. The discontinuation of AAdvantage accruals for basic economy tickets purchased through travel agencies further adds to the challenges faced by leisure-oriented agencies, particularly OTAs.
Industry experts like Peter Vlitas from Travel Leaders Network express confidence in their ability to qualify as preferred agencies. However, concerns remain regarding the impact of American Airlines’ decision on travel agencies. Vlitas emphasizes the need to persuade long-time travel advisors to adapt to the changing landscape of airline distribution. Eric Hrubant from CIRE Travel echoes concerns about the impact of these changes on end travelers who value loyalty points.
According to Garner, American Airlines has been transparent about its goal of transitioning to 100% NDC or direct bookings. While this move may feel like a challenge to travel advisors, Garner suggests that agencies must adapt to the evolving landscape of airline distribution. The concept of competition for an airline’s content is highlighted, implying that agencies must align with the airline’s strategies to remain relevant in the industry.
The impact of American Airlines’ NDC strategy on leisure travel advisors is significant. As the industry continues to evolve towards direct bookings and NDC-enabled transactions, travel agencies, especially leisure-oriented ones, must navigate through these changes to remain competitive in the market. Adapting to new booking norms and meeting airline requirements will be crucial for agencies to thrive in this evolving landscape.
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