Filter in or out as many as 200 cities, as well as hotel and car rental class and meals of the day and watch as the per-diem calculator automatically adjusts per diems to your program. Drill down into cost breakdowns and export the results.
New York Hilton Midtown - October 22-23, 2019
St. Regis Houston - October 30, 2019
San Francisco Marriott Marquis - November 5, 2019
ATPCO's Thomas Gregorson talks:
At its Elevate Conference this month, ATPCO unveiled a dynamic
pricing model that enables airlines to more quickly get a larger number of
price points out to the market, including personalized pricing. Part of that
model includes a road map to what ATPCO calls "continuous pricing,"
in which airlines no long would pre-distribute individual fares but instead could
price based on a minimum and maximum. The range would depend on the traveler
and circumstance. In the meantime, the model includes capabilities to expand
fares beyond the alphabet-based Reservation Booking Designator method, as well
as an "adjusted pricing" option, in which filed fares are adjusted
based on the data of the shopping customer, for example. ATPCO chief strategy
officer Thomas Gregorson spoke with BTN transportation editor Michael B. Baker
during the conference to explain the model and what it could mean for corporate
air pricing in the future.
BTN: Why is this
new model needed in the airline industry?
were not enough price points to give the consumers choice. [Airlines] were
creating new brands and new program offers and they needed more price points to
offer, and the current ecosystem is constrained. We tried to unlock that by
creating more variable updates, which is the quantum pricing, and more recently,
the dual RBDs, to remove the number of limitations on the number of price
points we have. That's been popular. We have more than 30 airlines using it in
a lot of different dimensions, and they're creating more products with more
price points to give the consumer more choice, so they're not locked into a
BTN: So break
down the different options.
have three flavors. [The first is] optimized pricing, which is just improving
the current [method]. That's in production and being used by many airlines and
continuing to be adopted by more. We have the adjusted pricing, which is what
we've been piloting for the last year. We're allowing the airline to be able to
adjust the price at the time of the shopping transaction. They'll be able to
say, "Here's a bunch of prices that I have, and I want to adjust it up or
down depending on the shopping transaction to make it more palatable for what I
want to package with the offer." We just did an implementation guide and
have standards that need to be implemented so that it's effective. We'll work
through that over the next period of months or so in order to get that into
production. The more difficult of the steps is how to get to continuous
pricing, which is the third bubble. You don't have any set prices but are doing
everything on the fly. We're going through piloting, experimentation and early
discovery of that. There's a lot of blocks we have to figure out on that
journey. It's going at a good pace. It's hard to change the whole industry
ecosystem to be able to adopt these things. If we could pick one, it would have
been a lot easier, but one doesn't fit all markets, customer segments or
methods, so that's why we had to create the variability.
BTN: How many
carriers are trying adjusted pricing right now?
Gregorson: We had
about six carriers doing the pilot. That was part of an industry work group,
where we had 100 or so participants engaged in the process, and we're sharing
BTN: With so many
more pricing options, what does that mean for transparency for those shopping
more of a [New Distribution Capability] question than a dynamic pricing
question. If people are using more and more offers in the marketplace, will
they be transparent for the rest of the world? The way the world has evolved so
far is: Public fares, the ones that are transparent, are growing [in number] at
a much higher rate than the private or negotiated fares. It seems the market does
like transparency. What we are implementing as part of this package to support
it is a new concept: public tariffs with limited distribution. Here's a public
price that you can tell the public about, but you can only come through the NDC
channel or another channel in order to get it. That will keep the pricing
transparent. Consumers will know about it, but they might be directed where to
go shop and buy to get the best price.
BTN: What will
this mean for the ways corporations contract with airline partners?
one of the biggest questions. Where there's change, there's opportunity. One of
the biggest challenges is how you can make sure you have a win-win corporate
agreement. An airline goes in saying, "I'd like 100 percent of your
business or a lion's share, so what do I need to commit in order for you to do
that?" When you have variability in price, how do you commit to something
that gives them comfort that they're getting the best price? That will all be
worked out as part of how we reshape the corporate agreement.
BTN: You have a
working group that is helping to form, test and carry out all of this. Has that
included representatives from agencies or the corporate travel space?
dynamic pricing working group is open to all. It's an open forum. We have very
large attendance in those groups, and we have all the disciplines covered.
Agencies and corporates—we could use more, so we'd welcome [that to] get more
feedback. We're trying to create an industry solution that works for all sides.
[Corporates] have the biggest questions: How is the corporate program and the
corporate offer going to be shaped, and how do I create a relationship with the
airline that I'm going to give my corporate budget to?
progress do you anticipate over the next year?
Gregorson: We'll see if the adjusted offers become more of
the mainstream over the next 12 months and whether that's something that takes
shape. We might find that's really just a niche product and jump to how to do
the exploration of continuous [pricing] and work through that. It will shape
how far and how fast we go in different disciplines.
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