Every rail provider has it own system and its own way to distribute content and does not make all of its content available
“In the air industry everything is more or less consolidated into one place, which is the global distribution system,” says Cédric Lefort, senior director for solutions engineering at BCD Travel. “Air is far less fragmented than rail. Every rail provider has it own system and its own way to distribute content and does not make all of its content available via the standard solutions. You just have access to a piece of it. “Most packages you need are not available via an online booking tool or the agency. You can only have access if you book via the website of the rail provider. It’s difficult for the GDSs or OBTs to develop connections to all this content.” Bleak as this situation may appear, technical, commercial and regulatory solutions are emerging which may yet make rail more visible. One growing hope is aggregators. They offer both technical and regulatory relief and are able to take API-based content feeds from all the rail operators and funnel them into a single, global pipe to TMCs and OBTs. Additionally, “what we’re working on is a sub-licensing model whereby we hold the licence and then all the TMCs, OBTs and GDSs we work with are able to operate on it,” says Trainline global distribution and business solutions director Liz Emmott. This is already the case in Italy. Another factor helping to unlock the market is growing competition in some European countries. Consequently, says Emmott, rail operators are telling Trainline they want more business travel sales. However, it remains the case, Emmott admits, that “some are more open than others”, which is why Lefort speaks for many managed travel professionals when he views regulation as unavoidable. “If we want to push people to travel more by rail, we need to have regulation,” says Lefort. “I’m convinced from a technical standpoint the operators could do whatever they want. The obstacles are mainly commercials and business models.” Hope lies mainly with an impending EU regulation called Multimodal Digital Mobility Services (MDMS), a legal framework to ensure access to all rail content for all distribution channels. Draft legislation is expected in the first half of 2023. Of course, just as with air, rail distribution isn’t only about sourcing and booking the content. The technology companies here too are looking at fulfilment, after service, administration charges for booking changes etc. It’s all part of the end-to-end cost of retailing.
SLEEPNG ON IT Hotels lost lots of ground with the pandemic. Occupancy rates and room rates tumbled. Floors of properties were commonly closed. And that wasn’t all. “Everyone lost people and resources. Hotel organisations had to let go of almost 50 per cent of sales forces,” says Lukasz Dabrowski, senior vice president, global supplier relations, at HRS. It became a time to reflect and consolidate while technology continued to drive change. “Distribution and booking channels behaviour has changed,” acknowledges BCD Travel senior vice president, April Bridgeman. BCD began to invest in hotel spend management before the pandemic with the aim of driving more bookings through the TMC. Bridgeman estimates that 40 per cent of hotel bookings are going outside the agency although some insiders estimate the industry figure to be closer to 10 per cent. She highlights that the emphasis on managed hotel programmes has continued to grow despite smaller and smaller returns. Revenue parity had become a challenge as the negotiated rates became available less and less often. And rates as business travel rebounded skyrocketed. “We also invested in analytics to help companies figure out how to save beyond sourcing in the hotel category,” says Bridgeman. “A company would negotiate over and over again with the same hotels so hotels felt they would get the business regardless. This was partially because the process didn’t allow travellers to influence decision-making – it’s not easy to get travellers to change where they book. “We need to improve traveller decision-making at the point of sale and use every behavioural strategy that’s used in consumer business. We need to act like retailers more than we do,” says Bridgeman who would like to see data that comes with rooms and services to be rich enough to act more like retailers. “Retailing works. We want to retail. Technology is getting better and smarter and making it easier but a lot of things could be done to make it even easier.” The industry trend is certainly for a more comprehensive technology solution. For example, Dabrowski believes that organisations are starting to understand the value of direct connect technology, data storage and transaction processing. He believes that cloud-based solutions are the future. ”We need to reduce the dependency on physical servers – speeds now are so much more superior.” And Bridgeman firmly believes integration between distribution and settlement is needed. “I’d love to see a world where if an agency is to be paid a 10 per cent commission, it’s an easy process or where tax is not charged if you’re going to reclaim it anyway.”
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SPRING 2023 | businesstravelnewseurope.com
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