OBTs Evolving Amid Ecosystem Changes
Booking tool market is getting more interesting, but next-generation capabilities aren’t fully realized. Are buyers positioned to help?
Online booking tools have come a long way since their nascent days about 25 years ago, and they're continually changing—or being pushed to change—particularly as suppliers evolve their distribution strategies, and travel managers want full content again.
An OBT is the key connector between a managed travel program and the end user. Foundationally, it needs to access profiles and provide all content, apply policy, display options and provide a positive user experience. On top of that can come additional elements, like carbon capture.
But what is needed by travel managers versus what can OBTs deliver?
The answer depends on the tool, as each offers something a little different, whether it’s the market leader Concur, a new entrant like Spotnana, or something in between.
"No OBT is perfect right now, in fact far from it," said AmTrav CEO Jeff Klee, whose travel. management company has its own booking tool.
Even before getting content, an OBT needs a traveler profile. Some OBTs have their own profile management system, some rely on the travel management company profile management system, and some buy it off the shelf, said Results Plus Consulting founder and former travel manager Kim Hamer.
"This could all change with Digital ID," she said, which is where the traveler owns their information and they decide what they want to share, which will affect search results.
Then, after getting the basics down, an OBT should provide added value, like one-stop comparison shopping, because "just getting the content is not a value-add; anyone can do that on their own," Klee said. "It's a big ask for a travel manager to say to their travelers, 'You have to use this tool, you have to do it this way.' If we don't provide enough value to make it worth them going through that burden, then what good are we?"
"It's a big ask for a travel manager to say to their travelers, 'You have to use this tool, you have to do it this way.' If we don't provide enough value to make it worth them going through that burden, then what good are we?"
No Guts, No Glory—Understanding OBT Innerworkings
OBTs get their content through a variety and combination of options including direct connects, global distribution systems and other aggregators. But an OBT isn't likely to have every direct connect, nor are they going to use every aggregator, "and some of those aggregators come at a cost," Hamer said, adding that some OBTs also "don't necessarily connect or work with every GDS,” but having access to content is critical.
Despite Klee's comment about TMCs and OBTs needing to provide value-adds, just getting access to that full content is top of mind for many travel managers, particularly with airlines increasing their use of New Distribution Capability and continuous pricing and not necessarily having all their content available in the traditional EDIFACT channel.
"If you haven't turned on GDS NDC with your TMC or you aren't accessing NDC content through other means, you're not offering the lowest logical fare," Hamer said.
Content also should include, in the case of airfares, details like change fees, refund policy, baggage charges, Wi-Fi, entertainment, seats. "We've got a long list of about 15 attributes that we want to make sure we're presenting with every offer," Klee said. "Depending on if it's coming from a GDS or a direct connect, sometimes we get all of those right from the source, and it's easy. But that's rarely the case. Usually, we get only [some], and we have to figure out what other data sources we [have to] use to augment what we got back from the source provider to deliver to our customers a consistent experience."
But let's say a tool does access the needed content. It then needs to display it. To make it consistent across suppliers, "at a high level, it requires the OBT to do some work to bring parity to the results no matter where the content comes from." Klee said
What should that display look like?
For Hamer, users should be able to comparison shop, and that might require accessing that content through multiple channels. And this is where Digital ID comes into play again.
"That's going to drive a lot more into the booking process and even self-service. [Users] will probably get access to a lot more options at the point of sale," she said.
Over the past month or two, Concur brought back its Matrix view, which about 15 percent to 20 percent of customers wanted, said Concur Travel president Charlie Sultan. "In terms of display, new Concur offers a more consumer-friendly view. It's evolved a lot more and looks like a consumer website to some extent."
Sultan said it still includes policy management attributes, preferred carrier attributes, but as opposed to seeing one fare for each carrier, you see multiple fares and you're able to roll over the attributes. Concur also is pulling in some data from RouteHappy to show what is available for each of the different products.
"It's available through both desktop and mobile, which is an enhancement to the display on both," Sultan said. "It includes sustainability attributes that weren't necessarily visible before, and then a lot of heavy filtering options that are there for the customer to help them get to what they're looking for a lot faster."
Next, travelers make their ticket choices. But the OBT doesn't fulfill the booking. That typically happens by the TMC or by the airline, depending on the type of ticket and how it's being purchased.
In many instances, particularly when a booking goes through a GDS connection, the TMC does the fulfillment and captures the data. But with a direct connect on an NDC ticket where the airline fulfills the booking, for example, how does the TMC get that information? That, too, depends on the tool and its set-up.
It also can vary by airline. "United, for example, allows servicing from both the TMC and from United, but other airlines, you have to verify with [them] as to who actually owns it," Hamer said. "When it is the GDS and the TMC owns the GDS agreement, irrespective of the OBT, then [the TMC] would be doing the ticketing or fulfillment. But NDC just puts a wrench in it."
In some cases, the OBT will create a passive Passenger Name Record, which is the repository for all things related to the booking, including financial transactions, and the TMC will see that to know about the booking and get that information into reports and duty of care.
"But it's a fraught process because that PNR isn't synced with anything," Klee said. "If something changes, no one's going to know about it."
That scenario can happen when a traveler makes the initial booking through an OBT but makes a change on a supplier website or app, which then breaks and gives the booking back to the supplier and the TMC loses visibility. If there is a disruption and the traveler can't self-service, they call the TMC, but the agent then often needs to call the supplier to do the servicing, which can get costly for corporations.
For TMCs that don't want a passive PNR, "it goes to our Trip API and from there, they can sort of view or claim the record," Sultan said. Concur in its updated version of its OBT has added GDS NDC content from Amadeus and Sabre in key geographies, he added, with Travelport to be added "in short order."
New entrant Spotnana, backed by Concur founder Steve Singh who now runs Madrona Ventures, operates differently and is "more than an OBT," said founder and chief product officer Sarosh Waghmar. "The company's infrastructure was built as a platform in the cloud, pulls in content through various sources including direct integrations, and does not rely on GDSs for NDC content or for record management," he continued. It has an offer-and-order management system, and it can display any content and have anyone service it as well, meaning if a traveler initially books through Spotnana then makes a change on a supplier website or app, all that information remains intact for the TMC.
"The difference between us and anybody else who connects on NDC is we don't go through aggregators," he said. "We're the database. We are the warehouse where everything is stored and consumed. … It's even facing the agent who is working and knows exactly what [a traveler] is clicking on. That's the fundamental difference between us and anybody. … I'm helping the servicing aspect of it all in that one screen. No more disparate systems, so the cost of servicing, all of that reduces."
Buyers Make a Choice: Evolution or Forced Change
One travel buyer in the pharma industry who asked to remain anonymous desired to switch OBTs in order to find a tool that gives them "the ability to book in the system through the corporate booking path, and then if changes are done directly with the carrier, they're reflected back in that path," said the buyer. Currently, they have to work with their company's traditional OBT first to see if their needs can be met.
The other thing the pharma buyer wants is ancillaries that go beyond offering seats. "Whether that's a bundle or doing things more on an ad hoc menu-selection basis," they said. They added that they'd also like to have the OBT recognize a traveler's loyalty status as well as show what corporate preferred benefits are available as part of the company's agreements with the airlines.
"I'm trying to work with the incumbents to meet my needs," the pharma buyer said. "Should that not pan out, then I would look to go an alternative route having demonstrated that we tried to make it work, but they couldn't meet our needs, so we need to go down another path or at least pilot something different. All [the new entrants] have potential in that space. We're still looking; they’re all in play."
"I'm trying to work with the incumbents to meet my needs. Should that not pan out, then I would look to go an alternative route having demonstrated that we tried to make it work… All [the new entrants] have potential in that space. We're still looking; they’re all in play."
OBT Deem also is offering an updated version of its tool, with Sabre NDC available, and Toyota travel services manager Rebecca Jeffries has been piloting the new version since May as she's been "very anxious to get NDC content," because without it, Toyota travelers aren’t getting comprehensive options. She plans to have American turned on likely by early November, with United Airlines content added possibly by the year end, "depending on the maturity of those connections."
A challenge Jeffries has encountered during the pilot is getting all the content options she knows are out there. The main issue was when "we would do an air search and pick the outbound flight, and it was NDC," she said. "The return would give us one flight option. That was it. It had to do with what Sabre was returning, so that's what they've been working on to try and get more results in that flight display."
One thing Jeffries likes about the Deem tool is that is has a toggle to switch between the classic version and the new version, so if there are any glitches with the new version—such as not being able to access rail content, she said—users can go back to classic. But fewer than 10 percent of her travelers have had to do that, she added. Another benefit is that Deem has carbon data available through a partnership with Thrust Carbon. Users currently have to look for it, but next year Deem plans to make that information "more front and center."
Another anonymous buyer, from the financial services sector, had been using Concur but began their search for a new OBT prior to the pandemic, mainly because Concur "was unwilling to really change," they said. "Part of the change was driven by our internal needs not being met. The other part was our dissatisfaction with the user experience." This buyer also said that since Covid put a hold on their search, NDC became more important after American made its moves in 2023.
"We also wanted to increase our adoption, because with Concur, our adoption had decreased over time, and it's obviously more efficient and less expensive to book online than calling and booking offline. So, it would save us money in the long run."
This buyer said their traveler's online adoption went from the mid-70 percent range to barely above 50 percent between 2018 and 2022. The company considered staying with Concur as its update was coming online, and it also looked at Deem and Neo, which is American Express Global Business Travel's proprietary OBT. They opted for Neo because GBT is their TMC. The switch is scheduled to take place in early 2025.
"We've been with GBT for a really long time, and they get us," the financial industry buyer said.
Something multiple buyers said they would like their OBT to do is accept split payments for when a traveler wants, say, an upgrade or some other ancillary that might be out of policy, so they purchase it with their personal credit card.
Spotnana's Waghmar said his platform has the ability for split payments today. Sultan said Concur has been meeting with a few of its largest customers to talk about how they would like that to work. "And we've been working with a couple of the airlines to discuss how exactly that would come through in the expense report," he said, adding that there are nuances as to how the ticketing would look.
If a traveler bought an economy ticket but paid for an upgrade to business, that ticket might come back as a business class booking, which is out of policy, so how do you modify the ticket once it's been purchased, Sultan posited. "There's some of those nuances to work through," he said. "We’re working on it, [but] it's something that we don’t have published on the roadmap yet."
The buyer from the pharma industry said "you want to be able to [make split payments] within the one system. That's where I think the GDS NDC path is falling short today. I guess you could say it's the GDS holding it back, by not offering these full capabilities, which seem to be there if you build those capabilities with the API. That's one piece. The second piece is some of the newer entrants who have the capabilities don't necessarily have the global footprint."
While some of those newer entrants might counter that comment, it implies that if a travel program is more U.S. centric, a company has more options.
"But that means you may have to leave your current provider," the pharma buyer said. "Your current providers are kind of stuck in this hold while we're tied to the GDS and tied to traditional tools where everything's built around a PNR and invoicing and a ticket drives their revenues."
What's Next: Bundles, AI?
As OBTs expand their content array, will they be able to capture and display bundles and more personalized offers for travelers? How will loyalty come into play in search results?
Salesforce senior director of global travel Dorian Stonie is on the new version of Concur and has added NDC content from American and United, and he has noted that he is looking to add bundles in 2025. He also tested some bundles prior to upgrading to the new Concur and adding NDC.
"A lot of it is still to be determined," Stonie said. "Each airline approach to bundles, at least in our discussions, is a little bit different. Are there limited or unlimited bundles? The thought process [by the airlines] has varied greatly."
By using bundles, he said he'll also get more visibility on employees who are utilizing these services "and can better align that with travel policies—who can upgrade their seat to a more legroom seat on what length of flight," Stonie said. But the thing that interests him is "how do we reach beyond just the traditional ancillary fees and look at bundles that might better provide more personalized service to the needs of that traveler depending on their persona and different types of travel needs?"
Loyalty status also would be a nice value-add.
"In the current general search, that is not calculated; it's just based on straight airfare," Stonie said. "But I think with this new generation of systems coming out, it's going to be factoring in the soft discounts and soft benefits that travelers are going to get, either because they are associated to our corporate program and/or their individual status with the airlines. That's not yet available in the OBT, but we're hoping it's going to be coming up very, very quickly as we start heading into 2025."
Some OBTs are using AI, but there's room for growth.
Toyota's Jeffries would like it if when someone was doing a search for one of the company's city pairs, or to a destination where it has a location, "we'd like AI to say here's what your colleagues are choosing or present you the options that make the most sense knowing our business and knowing the history of what everybody else has been doing," she said. "But it's hard to envision right now."
"In the current general search, [loyalty] is not calculated... But the new generation of systems [is] going to be factoring in the soft discounts
and soft benefits that travelers are going to get, either because they are associated to our corporate program and/or their individual status.”
Stonie believes AI will add multiple levels of services to what we would consider a traditional OBT. "The next gen platform is going to take that OBT and your T&E tool and expense tool and connect it to your CRM system, connect it to your HR system, to your sustainability so that you could look at not only what the cost of the airline trip is, but then connect it to what customers you're meeting. We also see it being integrated into more platforms, like Slack and Teams so ultimately travelers will not have to maintain separate systems."
For Waghmar, "We believe AI fundamentally will change the way search happens," he said. He gave an example of where it learns by not only what a traveler clicks, but especially on what they did not buy—"anyone can report what you bought." And if that traveler buys a fare that wasn't the lowest viable option, it can send a live alert to that person's manager, who then might reach out to the traveler and get the context for why they didn't purchase the lower-priced fare.
Spotnana also is using AI to clean up content, like hotel duplicates—one hotel that has multiple names in the system. In addition, beyond basic tasks, Waghmar said the company is using AI to build understanding relevant to context. For example, if a trip gets disrupted, the system should provide immediate solutions on which to click, not just alerts, including not just air but an extended hotel stay as well, based on that new flight option.
"This vision has to be brought to life for the industry as a whole," Waghmar said. "We are not trying to say we want to be the biggest TMC. We want to move the industry forward, and the only way to move the industry forward is having a platform-first approach. Let everyone build on top of it. The more data that flows through the platform, you start building the language model for travel. That is where the true magic happens, because then I'm able to predict what you might do or might want. I'll have the ability to surface it while you're searching."
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