Airfare Distribution Channel
Posted On July 4, 2020
AIRFARE DISTRIBUTION CHANNEL 5
Theaviation distribution has been evolving over time and offers anexcellent example of innovation in the marketing area. The innovationof the first computer reservations systems stands to be one of thegreatest advancements in technology not only for the airline industrybut the entire world. The development of the major computerizedsystems that are capable of managing several transactions stands asthe basis for rapid development of the airline industry around theglobe which has contributed significantly to the rise ofglobalization. Today, the industry serves as an important part of thee-commerce phenomenon which has been adopted by various sectors.
Thereare currently a large number of air travel management agencies thatoffer platforms where passengers can book their flights to variousdestinations. Product information normally varies depending on thedistribution channels. To reach many customers, airlines havedifferent distribution channels where clients can access flightinformation. In the case of the United Airlines, the productioninformation from Expedia is similar to the one found in the United`swebsites regarding flight tickets. From Chicago International Airportto Tokyo Narita International, and back, both websites show a totalcharge of $835.56. It is, however, expected that flight charges donot change for a given airline despite the distribution channel.While an individual can cancel a flight within 24 hours for free withthe United Airline’s website (United Airlines, n.d), Expediacharges a fee of $300 per ticket for itinerary changes (Expedia,n.d). In Airline’s main website, there are options of the type ofseat from which a passenger can choose and whose prices vary. InExpedia, there are no options. The United Airline’s websitedisplays more information on other charges such as luggage while thetravel agency does not provide any of such information.
Implicationfor the Future of Airline Distribution
Theairline industry is the pioneer of e-commerce. Much has changed forthe last 50 years since the introduction of electronic businesswithin and across the carrier distribution. There have beenadvancements of business models and technological innovations whichthe industry has not embraced fully. The industry needs to positionitself and come up with better means of taking their products to thecustomers across the global and a more convenient way.
Thefuture of airline distribution relies on the adoption of newtechnologies and systems that will ensure that clients can accessvarious available products easily. All necessary informationregarding a flight or any product should be readily available acrossall the distribution channels. From the previous experience, planningand buying of flights have proved to be a complicated and tediousexperience. A report by Harteveldt (2016) estimated that over 8.1million people would board a commercial airline across the world. Thechallenge faced by the passengers is that the airlines are currentlyconducting their business in a fragmented and complicateddistribution environment (Harteveldt, 2016) as evidenced by therising number of travelers who use the internet for shopping,planning, and buying flights online. The problem is that a travelerhas to search multiple websites before booking due to lack of fullinformation on some sites and different price quotes. Someintermediaries of travel agencies may display information on theavailability of economy class seats or premium economy cabins andadvice on the benefits of such flights, while some agencies do not.
Thefuture can be viewed as a generation where people will be usingInternet services more and, therefore, expect to get all informationabout a flight online. Future passengers will be enjoying high-speedconnectivity anywhere and thus, airline distribution and e-commercestrategies should incorporate the use of mobile phones such asapplications or online accounts. The use of mobile apps, as well asdigital payment, is likely to increase (Harteveldt, 2016). It is,therefore, critical for airlines to understand the customers’ needsand provide full up-to-date information about al products available.
Harteveldt,H.H. (2016). The Future of Airline Distribution, 2016 – 2021.Atmosphere Research Group. Retrieved February 24, 2017, fromhttps://www.iata.org/whatwedo/airline-distribution/ndc/Documents/ndc-future-airline-distribution-report.pdf
UnitedAirlines (n.d). Accessed February 23, 2017, fromhttps://www.united.com/ual/en/us/
Expedia(n.d). Accessed February 23, 2017, from https://www.expedia.com/