Global Distribution System (GDS) for your Travel Industry

Understanding GDS and its Importance

What is GDS system? A Global Distribution System (GDS) is a computerized reservation system that acts as a bridge between travel providers like airlines, hotels, and car rental companies, and travel agencies along with other related businesses. GDS systems enable users to easily look up and book various travel services such as flights, hotel accommodations, and car rentals, all in real-time.

Importance of GDSs in the Travel Sector

What is GDS in travel industry? Global Distribution Systems (GDS systems) hold a crucial position within the travel industry. Their primary function is to establish connections between travel suppliers and various entities like travel agencies and other businesses. This connection facilitates the swift and convenient booking of travel distribution services. Furthermore, GDS systems contribute to enhancing the efficiency and transparency of the travel market.

Key Contributions of GDS systems to the Travel Industry

Centralized Travel Information Hub

GDS booking system serves as a central repository for an extensive range of travel-related data from diverse suppliers. This comprehensive information pool is then accessible to travel agencies and other entities, simplifying their search and booking processes for required travel products.

Real-time Booking Facilitation

A GDS booking system empowers travel agencies and similar businesses to carry out real-time bookings of travel services. This capability ensures that travelers can make speedy and hassle-free bookings, even when making arrangements at the eleventh hour.

Enhanced Efficiency and Transparency 

By providing a unified access point for travel data, a GDS booking system contributes to streamlining the travel market. This simplifies the process of comparing prices and making bookings across various suppliers, ultimately fostering a more efficient and transparent travel environment.

In essence, GDS systems play a pivotal role within the travel industry ecosystem. They simplify the process of booking global distribution services and promote a more organized, efficient, and open marketplace for both businesses and travelers.

Benefits of Using GDS System for OTAs

Online Travel Agencies (OTAs) heavily rely on GDS systems for a significant reason. GDS systems provide OTAs with access to a vast range of travel options available in the market, which allows them to offer their customers the best possible choices for their travel needs. Moreover, GDS systems bring additional advantages to OTAs

Global Outreach

GDS systems establish a global network linking OTAs to diverse travel suppliers worldwide. This inventory system used by travel agencies empowers OTAs to provide a broad spectrum of travel services from various corners of the globe. This, in turn, enables OTAs to provide their customers with a comprehensive range of travel choices, regardless of their geographical location.

Data Analytics Capabilities

GDS systems offer OTAs access to sophisticated data analytics tools, facilitating the monitoring and analysis of their performance metrics. Leveraging this data aids in enhancing marketing campaigns, optimizing pricing strategies, and making informed business decisions that align with market trends and customer preferences.

Strategic Partnerships

Collaborations between hotel global distribution system and other travel technology providers, such as payment processors and marketing platforms, benefit OTAs by broadening the scope of available global distribution services. These partnerships contribute to enhancing the overall operational efficiency of OTAs.

Regulatory Compliance

GDS systems adhere to various regulations, including those concerning data security and privacy. By aligning with compliant GDS systems, OTAs can mitigate the risk of potential fines and penalties associated with regulatory non-compliance.

Enhanced Profitability

The partnership with GDS systems translates into cost savings for OTAs, encompassing areas like booking fees and commissions. These financial advantages can significantly bolster profits and augment competitive prowess in the market.

Real-time Information Accessibility

GDS systems furnish access to real-time inventory and pricing data, enabling OTAs to provide customers with the most up-to-date travel information and options. This timely information equips OTAs with a competitive edge, as they can offer travelers the latest and most relevant choices.

Effortless Booking Process

The GDS booking system streamlines the booking procedure, simplifying travel arrangement reservations for customers. Furthermore, they offer the convenience of immediate confirmations, which significantly enhances customer satisfaction by providing a sense of assurance and promptness in their travel plans.

GDS systems play a pivotal role in facilitating seamless interactions between travel agencies and suppliers, ultimately benefiting both the OTAs and the travelers they serve. OTAs can leverage GDS systems to expand their reach, improve their efficiency, and reduce their costs. These benefits allow OTAs to offer more competitive prices and provide better travel distribution services.

Key Players in the GDS Market

As reported by Transparency Market Research, the GDS global distribution system market held a value of US$ 4.7 billion in 2021 and is projected to display a Compound Annual Growth Rate of 4.3% during the period from 2022 to 2031. The study also predicts that the global GDS market will reach a value of US$ 7 billion by the conclusion of 2031. The best global distribution system providers in the industry are:

Amadeus

Amadeus, one of the best global distribution system provider, delivers a spectrum of travel distribution services tailored for the travel industry. Operating on a global scale, it grants access to an extensive array of travel suppliers including airlines, hotels, and car rental companies.

Pros:

• Offers a comprehensive suite of travel solutions
• Global presence for widespread coverage
• Facilitates access to an extensive network of travel suppliers

Cons:

• Costs might be prohibitive for smaller OTAs
• Some users have reported occasional sluggish platform performance

Sabre

Sabre is another prominent GDS provider offering a suite of travel technology solutions tailored for the travel industry. Its platform, widely utilized by OTAs and other travel enterprises, provides access to a broad range of travel distribution services.

Pros:

• Provides a diverse range of travel solutions
• Enables access to numerous travel suppliers
• Features a user-friendly platform

Cons:

• Smaller OTAs might find the costs challenging
• Customer service responsiveness has been reported to be slow by some users

Travelport

Travelport, a leading GDS provider, furnishes a variety of travel technology solutions catered to the travel industry. With access to a wide array of travel distribution services, its platform serves as a choice for many OTAs and other travel entities.

Pros:

• Offers a comprehensive suite of travel solutions
• Provides access to an extensive network of travel suppliers
• Features a user-friendly platform

Cons:

• Costs might be a deterrent for smaller OTAs
• Platform performance slowdowns have been reported by some users
• These big players in the GDS market offer a bunch of solutions that fit the travel industry’s moving parts. Online Travel Agencies (OTAs) can make a good decision by checking out these upsides and downsides when choosing their GDS provider.

Features to consider when choosing a GDS

When it comes to choosing a travel or hotel global distribution system for Online Travel Agencies (OTAs), several factors come into play. These considerations are pivotal in ensuring that the chosen GDS booking system aligns seamlessly with the OTA’s business goals and operational requirements:

Inventory Depth and Breadth

The inventory system used by travel agencies play a dominant role in shaping their journey. OTAs must ensure that the travel GDS offers a comprehensive selection of travel options such as flights, accommodations, car rentals, and other related services. This ensures that OTAs can cater to diverse customer preferences.

User-Friendly Interface

An intuitive and user-friendly travel GDS interface is essential for sustainable global distribution services. OTAs need to ensure that both their agents and customers can easily navigate the platform, locate relevant information, and seamlessly complete travel bookings. A user-friendly interface enhances efficiency and customer satisfaction.

Integration Capabilities

Compatibility with existing systems is paramount in travel distribution services. The chosen travel GDS should seamlessly integrate with the OTA’s current infrastructure. This integration facilitates efficient management of inventory system used by travel agencies, besides streamlining pricing, and bookings, reducing operational complexities.

Reporting and Analytics Tools

Robust reporting and analytics tools provided by the travel GDS are invaluable. These tools empower OTAs to monitor their performance, identify trends, and make informed decisions. Insights gained from these tools contribute to strategic planning and continuous improvement.

Pricing

The cost of adopting a travel GDS is a critical consideration. OTAs need to evaluate the expenses associated with integrating the GDS booking system into their operations. It’s essential to ensure that the benefits gained from using the GDS outweigh the associated costs.

Support

Adequate support from the travel GDS provider is essential for smooth operations. OTAs should prioritize GDS options that offer reliable 24/7 customer support. Additionally, the availability of training resources ensures that OTA staff can effectively utilize the GDS’s features.

Reputation

Opting for the best global distribution system with a reputable standing in the industry is essential. A travel GDS with a positive industry reputation signifies reliability, security, and a track record of customer satisfaction. Choosing a well-regarded GDS instills confidence in the OTA’s partnership decision.

Understanding New Distribution Capability (NDC)

New Distribution Capability (NDC) is a standardized format created by the International Air Transport Association (IATA) using XML, designed to enable airlines to directly share their offerings with travel agents and online travel agencies (OTAs) through a set of travel APIs. NDC represents a modern alternative to the traditional method of distributing airline content through Global Distribution Systems (GDS systems).

Importance for OTAs

NDC holds significant importance for OTAs as it grants them access to a broader range of airline content, including additional services like seat selection and baggage fees. This enables OTAs to offer their customers a more personalized and flexible travel experience. Additionally, adopting NDC can help OTAs enhance their profit margins by decreasing the commissions they pay to GDS systems.

How does NDC enhance travel distribution services?

NDC represents a significant advancement that has the potential to transform the distribution of airline content. It improves travel distribution services in several ways:

1. It empowers airlines to share comprehensive and tailored information about their products, including seat availability, ancillary services, and baggage fees.
2. It facilitates direct communication between airlines and OTAs, bypassing the involvement of travel GDS systems. This can lead to cost reductions and increased efficiency.
3. It enables OTAs to provide customers with a more personalized and versatile travel experience.
4. It empowers OTAs to enhance their profit margins by reducing commissions paid to GDS booking systems.

Benefits of Adopting NDC for OTAs

OTAs that embrace NDC can anticipate improved efficiency, increased profit margins, and enhanced customer service. Here are some significant advantages of integrating NDC into the operations of Online Travel Agencies:

1. Tailored and Flexible Travel Packages

NDC empowers OTAs to craft personalized travel packages that align with each traveler’s preferences. These packages can include flights, accommodations, car rentals, and activities. Additionally, NDC allows for dynamic pricing based on traveler characteristics and trip specifics, enhancing the potential for effective upselling and cross-selling.

2. Enhanced Ancillary Services

NDC provides comprehensive access to detailed information about ancillary services such as baggage fees, lounge access, and priority boarding. This enables OTAs to present their travel distribution services prominently and upsell them to travelers. Furthermore, OTAs can bundle ancillary services with flight offers to provide enhanced value to customers.

3. Improved Data Analytics for Insights

With NDC, OTAs can tap into extensive passenger data, booking details, and transaction information. This data can offer valuable insights into traveler behaviors, preferences, and product performance. These insights can be leveraged to create targeted marketing campaigns, personalized offers, and optimized product combinations.

4. Elevated Distinctiveness

Through NDC integration, OTAs can gain a competitive edge by offering unique features such as tailored packages, an expanded array of ancillaries, and individualized deals. This distinctiveness can attract more travelers and foster brand loyalty, setting them apart in a crowded travel marketplace.

5. Future-Ready Business Approach

NDC represents the future of airline distribution. By incorporating NDC into their operations, OTAs can align their systems and processes to embrace upcoming opportunities. This proactive approach allows them to stay ahead of competitors and adapt their business strategies in response to industry developments.

How NDC Complements GDS

Let’s explore the symbiotic relationship between NDC and existing GDS booking systems. New Distribution Capability (NDC) and GDS global distribution system can collaborate effectively to the advantage of OTAs. Several key ways in which NDC complements GDS system include:

1. NDC for enriching content, GDS for transactions

NDC can provide access to comprehensive flight content such as detailed descriptions, images, videos, seat maps, baggage information, and more. While actual flight bookings can still be facilitated through travel GDS, this dual approach enhances the shopping experience without disrupting established booking procedures.

2. NDC for ancillary services, GDS for core flights 

NDC opens the door to airline ancillaries. OTAs can utilize NDC to present and sell ancillaries, while continuing to manage core flight ticket bookings through travel GDS. This strategy allows OTAs to tap into ancillary revenue without necessitating an overhaul of existing flight booking systems.

3. NDC for tailored offers, GDS for general availability

NDC empowers airlines to create personalized flight offers and packages based on traveler profiles and trip specifics. OTAs can present these NDC-based offers to travelers seeking customized options. Meanwhile, they can still rely on travel GDS for general flight availability and reservations.

4. Gradual transition to NDC 

Instead of an abrupt shift, OTAs can opt for a gradual transition to NDC. They can begin with specific use cases such as accessing enriched content, ancillaries, or personalized offers. As NDC matures and proves its value, the proportion of NDC bookings can be incrementally increased while maintaining travel GDS functionality. This phased approach minimizes risks and operational disruptions.

5. GDS as an aggregator of NDC content

Certain travel GDS providers are developing aggregation platforms for NDC content, consolidating offerings from various airlines within their systems. OTAs can access this aggregated NDC content through travel GDS, in addition to conventional GDS content. This approach streamlines access to all airline offerings through a unified interface.

6. Synergistic Impact

NDC and GDS can work together to provide more value to both OTAs and their customers. This collaboration will involve a gradual transition, with GDS booking systems integrating NDC content. A unifying approach where GDS acts as a facilitator for NDC content and global distribution services will ultimately prove beneficial to both airlines and OTAs in the long term.

How NDC-GDS Integration Benefits OTAs?

1. Access to rich NDC content

NDC-enabled GDS systems provide access to enhanced NDC content from airlines like ancillaries, bundles, rich media, etc. OTAs can display this content to provide more options and value to travelers. By accessing NDC content through travel GDS platforms, OTAs can offer travelers a wider range of products and services from airlines that have adopted NDC standards. This enriched content includes ancillaries, fare families, bundles and personalized offers. 

2. Streamlined distribution

GDS systems act as a single point of integration with multiple airlines for OTAs. By supporting NDC, GDS systems can distribute NDC content from various airlines through their existing connections with OTAs. This avoids the need for OTAs to integrate with individual airlines one by one. travel GDS platforms have existing integrations with many airlines and OTAs. By enabling NDC, they can facilitate the distribution of NDC content across these partners through their established connections. This streamlines the distribution process and avoids the complexity of point-to-point integrations between airlines and OTAs.

3. Scalability

GDS platforms are built to distribute travel content at a massive scale. By enabling NDC, GDS systems allow OTAs to distribute NDC offers to large numbers of travelers in an efficient manner. Travel GDS systems have a proven capability to distribute travel products at a high volume. NDC-compliant GDS systems apply this scalability to NDC content, allowing OTAs to reach more travelers with NDC offers in a seamless way. 

4. Interoperability

NDC-compliant GDS systems can translate and normalize NDC messages into a format that works with the OTA’s systems. This resolves interoperability issues and allows OTAs to integrate with NDC without major system changes. As NDC standards evolve, GDS systems keep their NDC adapters up-to-date, handling protocol changes on behalf of OTAs. This minimizes the impact of NDC upgrades on OTAs and ensures interoperability even as standards change over time.

5. Reduced costs

Integrating with GDS systems instead of multiple airlines significantly reduces costs and resources needed for technology integration and maintenance. NDC-enabled GDS systems provide a cost-effective way for OTAs to access NDC content. Establishing direct connections with multiple airlines requires significant investments of time, money and technical resources. GDS platforms offer a centralized integration point and shared infrastructure, reducing duplication of efforts and cutting down costs. 

6. Booking flexibility

NDC allows more complex bookings with ancillaries and multi-airline itineraries. NDC-compliant GDS systems are able to support such bookings, providing more options to travelers. They also facilitate re-accommodation in case of disruptions. NDC enables personalized offers, ancillaries and rich content that provide more choice to travelers. NDC-enabled GDS systems have the capability to process such complex bookings and service them efficiently with changes and cancellations. This flexibility is extended to OTAs through GDS integration.

7. Future-proof

By using travel GDS platforms that keep pace with NDC standards, OTAs can ensure their distribution model evolves with the industry. NDC-enabled GDS systems help OTAs stay ahead of trends and adapt their business to new retailing models. GDS companies continuously update their NDC adapters to the latest versions of the standard. By relying on travel GDS systems, OTAs can make sure their NDC distribution channel stays up-to-date with standards and aligned with the future direction of airline retailing. 

8. Key Takeaway

NDC-compliant GDS systems act as a conduit for OTAs to unlock the benefits of global distribution system and NDC technology in an efficient, scalable and cost-effective manner. Integrating with GDS systems is a strategic move for OTAs to gain access to NDC content without major disruptions to their business.

Selecting the Right GDS for Your OTA

When it comes to selecting a Global Distribution System (GDS) for your Online Travel Agency (OTA), making the right choice requires careful evaluation of several critical factors. These aspects will contribute to a successful and fruitful partnership with your chosen GDS

1. Target Audience and Geographic Reach

Ensure that the GDS aligns with your target customer segments and operates in the regions that matter most to your business. Different GDS systems cater to distinct audiences, so their content and capabilities should align with your OTA’s focus. It’s also important to assess their presence and coverage in your key markets.

2. Integration with Existing Infrastructure

Evaluate how seamlessly the GDS can integrate with your current systems, including booking engines, mid- and back-office platforms, payment gateways, and more. Prioritize GDS options that offer open APIs, comprehensive documentation, and robust technical support to facilitate a smooth integration process.

3. Cost Structure and Pricing Models

GDS fees often consist of a combination of upfront costs and ongoing transaction fees. It’s essential to thoroughly compare the pricing structures of different GDS providers to identify the one that best suits your OTA’s budget and business model. Additionally, some GDS systems offer incentive programs and discounts for high-volume OTAs, which could be advantageous for your growth.

4. Customer Support and Training

The quality and availability of customer support services can greatly impact your experience with a GDS booking system. Investigate the level of support they provide, including documentation, training resources, consulting services, and customer service availability. It’s crucial that the GDS booking system can accommodate your geographic locations and time zones and offer the necessary training resources to empower your staff.

5. Product Features and Functionality

Carefully review the suite of features and tools that the GDS booking system offers. This includes evaluating their search and booking engines, mid- and back-office modules, analytics platforms, and more. Verify that these capabilities align with your OTA’s operational and technical requirements. Additionally, assess the GDS’s commitment to ongoing development and innovation through their future roadmaps.

6. Partners and Content

The diversity and quality of travel suppliers accessible through the GDS booking system can significantly impact your ability to provide appealing travel options to your customers. Ensure that the GDS booking system offers access to a comprehensive range of airlines, hotels, car rentals, and other travel distribution services that align with your OTA’s offerings and customer preferences.

7. Technology and Innovation

Stay attuned to the technological advancements that the GDS booking system incorporates. Factors like NDC adoption, integration of artificial intelligence, and cloud services can shape the capabilities and effectiveness of the GDS booking system. While innovation is valuable, it’s equally important that the technology is reliable and proven to deliver results.

Integrating GDS with NDC Capabilities

How GDS providers are adapting to NDC standards?

Amid the dynamic terrain of travel technology, GDS global distribution system providers are strategically evolving through the integration of New Distribution Capability (NDC) standards into their well-established frameworks. This fusion offers a substantial edge, empowering GDS providers to broaden their scope and furnish clients with an all-encompassing assortment of content and services. This includes tailor-made travel packages and an extended spectrum of supplementary offerings.

The synergy between traditional GDS and NDC

The symbiotic relationship between the traditional GDS and NDC is evident in their harmonious coexistence, wherein they mutually enhance each other’s capabilities. Conventional GDS systems serve as gateways to a vast array of travel products and services, while NDC paves the way for the dissemination of dynamic and tailor-made travel propositions. Through the integration of NDC features within their existing infrastructure, GDS providers elevate their capacity to deliver an enriched portfolio of travel options and services to their customers.

Tapping into dual systems for competitive leverage 

For Online Travel Agencies (OTAs), the convergence of these systems translates into a strategic leverage point. OTAs stand to gain a competitive edge by diversifying their offerings and providing customers with an enhanced spectrum of travel products and services. The amalgamation of NDC capabilities into established GDS frameworks empowers OTAs to extend personalized travel packages and ancillary services, a realm traditionally exclusive to airlines’ direct sales channels. This strategic alignment empowers OTAs to distinguish themselves within the industry, fostering differentiation from competitors and nurturing heightened customer loyalty.

Best Practices for Successful GDS Implementation

1. Assess Requirements and Goals

Begin by clearly defining your business and technical needs. Identify specific requirements related to content, features, integration, and costs. Set well-defined goals to measure the effectiveness of the GDS implementation, including metrics like conversion rates, booking volumes, time savings, and data quality.

2. Plan Integration and Data Migration

Develop a comprehensive plan for integrating the GDS with your existing systems. Create a roadmap for transferring data from old platforms to the new GDS accurately and securely. Allocate ample time and resources for the integration process, along with thorough testing.

3. Provide Efficient Staff Training

Offer comprehensive training programs to familiarize your staff with the new GDS platform. Utilize training manuals, videos, webinars, and hands-on sessions. Continuously provide learning resources to support ongoing skill development and proficiency.

4. Monitor Performance and Adapt

Regularly monitor key metrics and compare them against established goals to ensure the GDS booking system is fulfilling your requirements. Customize configuration settings as needed and update training resources to account for any changes. Regular consultations with your GDS account manager can provide valuable insights for optimization.

5. Initiate a Pilot Program

If feasible, implement the GDS for a limited selection of products, suppliers, or customer segments initially. This approach allows you to gain hands-on experience with the new system on a smaller scale before a full-scale rollout. Use this pilot phase to test integration, assess performance, identify challenges, and make necessary refinements.

6. Allocate Internal Resources

Designate dedicated staff members to lead and manage the GDS implementation project. They will oversee tasks such as business analysis, technical integration, testing, training, and performance monitoring. Having focused resources facilitates efficient and successful GDS adoption.

7. Foster Continued Collaboration

Maintain close collaboration with your GDS provider beyond the initial implementation. Regular meetings to review reports, discuss improvement opportunities, tackle challenges, and align on future plans will optimize the value derived from your GDS investment.

Seamless GDS Integration for OTAs: OneClick’s Expertise!

As an Online Travel Agency (OTA), integrating with a GDS booking system is crucial for accessing rich travel content, offering diverse global distribution services, and fostering future growth. However, GDS integration can be complex, and may require significant time, resources, and expertise. OneClick IT Consultancy excels in GDS integration for OTAs. Here’s why to choose OneClick:

1. ARMI Certification

OneClick stands among a select group of 30-35 worldwide companies holding ARMI certification, attesting to our capacity to implement NDC Compliance. ARMI, serving as the industry standard for mid- and back-office procedures in air travel, empowers us to seamlessly integrate your GDS with ARMI-compliant systems for enhanced business efficiencies.

2. Domain Proficiency

Beyond technical proficiency, OneClick boasts an intricate understanding of the travel industry and GDS systems. Our specialists grasp the intricacies of various GDS platforms, along with the distinct demands and workflows of OTAs. This domain knowledge guarantees a harmonious alignment of your GDS booking system with your business model.

3. Resource Efficient

GDS integration necessitates allocation of time, finances, and internal personnel. Entrusting OneClick allows you to access dedicated technical experts and fulfill your GDS endeavor without diverting essential internal resources. Our services are tailored for cost-effectiveness, accelerating your adoption of GDS capabilities.

4. Future-Ready

OneClick maintains currency with prevailing technologies, standards, and trends shaping the travel industry, encompassing NDC, ONE Order, and data security. Partnering with us ensures your GDS solution is primed for future growth, and our forward-looking approach instills a sense of readiness in your business.

OneClick’s Comprehensive GDS integration solutions

• In-depth analysis to discern your unique requirements
• Seamless technical integration of GDS with booking engines and mid-/back-office systems
• Data migration services for seamless transition of information
• Rigorous testing and quality assurance to ensure a smooth deployment
• Training and ongoing support to enhance your staff’s efficiency with the new GDS
• Continuous optimization efforts to extract maximal value from the GDS

For OTAs seeking a steadfast partner in GDS integration, OneClick stands as an ideal choice, driven by our expertise and extensive experience in fulfilling diverse business objectives. Connect with us today to delve deeper into how our GDS integration services can amplify your OTA’s capabilities.

Future Trends in GDS and NDC

The world of GDS global distribution system and New Distribution Capability (NDC) technologies is always advancing to match the evolving demands of the travel sector. Here are some forthcoming trends in GDS and NDC technologies:

Enhanced Personalization

GDS and NDC technologies are progressing to offer even more tailored travel packages catering precisely to individual travelers’ requirements. This trend will persist as travel providers aim to stand out in the competitive landscape and offer travelers smoother booking experiences.

Rise of Artificial Intelligence (AI)

AI is playing a growing role in GDS and NDC technologies, delivering more precise and relevant search outcomes, boosting customer service, and enriching the overall travel journey. This trend will continue with the advancement and wider adoption of AI technology.

Deeper Emphasis on Data Analytics

GDS and NDC technologies are furnishing richer data on customer behaviors and preferences. This data is instrumental in enhancing marketing strategies, refining product offerings, and elevating customer service. This trend will endure as travel providers seek a competitive edge through data-driven insights.

As the travel industry evolves, OTAs must carefully choose their Global Distribution System (GDS) provider and explore NDC integration to enhance the booking experience. If you’re looking for a reliable partner to guide you through this integration process, consider exploring the comprehensive GDS integration solutions offered by OneClick. Our expertise and industry knowledge can help your OTA embrace these technologies and unlock their full potential.