John Chapman, Vice President, Airlines Group for Asia Pacific, says that more airlines will continue driving customers to their websites to cut costs.
He said that while airlines had always had their websites and online bookings, "they were pretty channel agnostic and quite protective of travel agents".
"Now we are seeing them get more engaged in encouraging direct website bookings and we are seeing a shift in the mindset of airlines - they are investing in the direct online channel and they are investing in technology to improve revenues."
Speaking at a media briefing in Bangkok, Chapman said the challenging times would fuel airline consolidation - "airlines are evaluating mergers and partnerships". It's also a time when low cost carriers are defining the market - "AirAsia has led the way" - and efficiency, cost control and yields have become crucial to airline profitability.
"Distribution strategies and models are changing," he said. "Airlines are maximizing the potential of website sales by having exclusive online deals and user friendly sites."
He said the new shopping tool introduced by Amadeus - Extreme Search - would give airlines a tool to embrace on their website to give a different kind of shopping option to online consumers. "Rather than just asking what flights are available, it will open it up by activity and budget."
The trend in low cost carriers leveraging on the GDS network was also one to watch, said Chapman. Citing the examples of Vueling, the low-fare airline based in Barcelona, and the AirAsia group, which became the first Asian group of low cost airlines to implement the Amadeus Ticketless Access solution, Chapman said low cost airlines realized that selling only on the Internet restricted their access to the corporate market and in markets where they had low brand awareness.
�It gives customers more flexibility and also allows travel agents options to evaluate AirAsia along with other airlines," said Chapman, who added that AirAsia was now getting bookings from markets such as Italy and Greece.
Another trend he's seeing is the unbundling and providing of a la carte services. The question is, will Asian carriers follow this trend.
Airlines were now charging for seat allocation, meal choice, insurance and baggaae options. He cited Regional Express Australia which was charging for itinerary options via SMS.
"It's less prominent in Asia so far. AirAsia is leading the trend, premium brands are more conservative," he said. What's clear is that "both airlines and travel agents stand to benefit from this trend."
Other trends he sees include more self-service kiosks and moble check in with boarding passes delivered to a handheld device such as the iPhone with a 2D bar code.
The airport of the future, he said, was where "frequent flyers keep on walking, you don't have to stop at any place because your personal device is with you".
"Most frequent flyers prefer an automated experience," he said, citing Air New Zealand in this region as having the most advanced self-service airport experience.
Asked if this would mean airlines having to pay lower fees to airports since it would mean fewer customer touch points, Chapman said it may allow airlines to lower costs but "I don't think airports will lower fees".
He said Amadeus was working with several airlines in the region on this front but said airlines in Asia were working more on kiosks rather than on mobile check-in. "It's a little slower by airlines in Asia."
"The way people buy travel in Asia, travel agents still play a bigger role. In Singapore, going forward, we will see airlines increase their online business and we will see an increased presence of OTAs but in Singapore Airlines, the service experience is still an important part of the messaging.
"Thre is more human interaction in Asia."
Yeoh Siew Hoon, one of Asia's most respected travel editors and commentators, writes a regular column on news, trends and issues in the hospitality industry for 4Hoteliers.com.
Siew Hoon, who has covered the tourism industry in Asia/Pacific for the past 20 years, runs SHY Ventures Pte Ltd. Her other writings can be found at www.thetransitcafe.com
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