NWA Shifting To Share-Based Deals, Joining Prism
Northwest Airlines tomorrow is expected to announce the launch of CorpNet, a new initiative enabling the carrier to shift all corporate client agreements to share-based performance metrics. The Prism Group of Albuquerque, N.M., is providing technology to facilitate the program, as it has done with Continental Airlines' Corporate Insight program and, more recently, United Airlines Corporate Solutions program.
"We already have had share-based agreements, but we used segments that were converted back into share through an antiquated process," said Fay Beauchine, Northwest vice president of passenger sales and customer relations. "This now uses actual ticket data and is much faster, cleaner and viewable online."
Market share-based contracting has become the preferred method in the current airline environment as corporations continue to face budget cuts and marked decreases in travel volume.
Northwest did not beta test the program, but an initial group of clients soon will transition to the new system, including Johnson Controls, Qwest, Pilkington, Compuware and others.
Like Continental's and now United's clients, Northwest's clients will be required to send travel data from their agencies to Prism for standardization. From there, Northwest will identify realized and potential savings and produce a more accurate analysis of origin and destination share information.
The online reporting capabilities are similar to Continental's--with certain tweaks--and will include monthly information on contract performance, broken out by cabin, city pair and other measurements. It also will uncover unused tickets.
Reporting initially will not include flown data from the airline back to the client, viewed by many travel managers as crucial. Northwest is developing that data feed but said few of its corporate clients have shown interest.
Meanwhile, Northwest's new Prism arrangement will help it and domestic partner Continental create single-document, share-based joint contracts. Alliance deals would be further enhanced should Northwest's well-entrenched partner KLM Royal Dutch Airlines opt for the Prism system. Beauchine noted that KLM "definitely is looking at this."
Beauchine said Northwest "will be sensitive" to client concerns, including hesitancy to work in a new model with a specific, pre-determined and required data consolidator. "We'll have to work through these issues one by one," she said, "but the product has gained lots of acceptance and privacy issues have been addressed thoroughly by Prism."