The travel industry is always changing because of consumer behaviour, new technology, and competition. GDS (Global Distribution Systems) play a key role by helping travel agencies and airlines connect with customers more easily. But alongside GDS, ancillary revenue strategies are becoming vital for maximising revenue and enhancing the customer experience.
From upselling travel offerings to integrating non-airline services, the synergy between GDS and ancillary revenue strategies offers enormous potential for growth. This article will look at how travel agencies and airlines can use these tools. They can boost revenue and meet the needs of today’s travellers.
A Global Distribution System (GDS) links travel providers, such as airlines, hotels, and car rental services, with travel agents. This includes online agencies, It helps provide real-time updates and makes booking easier. It serves as an essential tool for delivering real-time inventory updates and enabling smooth, hassle-free bookings.
Top GDS platforms like Amadeus, Sabre, and Travelport are key to the travel industry. They make service distribution easier with a centralized system. By simplifying administrative tasks and enhancing efficiency, they continue to play a vital role in modern travel operations.
Ancillary revenues are extra income from selling non-core services. This includes things like seat selection, baggage fees, and priority boarding. For airlines and online travel agencies, these small add-ons can make a significant financial impact.
A report from Idea Works Company in 2023 shows that airlines earned over $102 billion from extra services in 2022.
Coupled with GDS capabilities, ancillary services present a tremendous opportunity to improve travel experiences while driving bottom-line growth.
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This includes easy seat selection, extra baggage options, and special experiences at the destination. These advancements are changing how travellers plan and enjoy their trips. They are creating a new standard for convenience and satisfaction.
For airlines, ancillary sales represent both an essential revenue stream and an opportunity to improve customer satisfaction. Airlines can upsell many products, examples include priority boarding, extra legroom seats, in-flight meals, and travel insurance.
Adding extra services to GDS platforms makes it easier for travel agents. This helps them market and sell these products directly to customers. By embedding ancillary options into the booking flow, airlines can significantly increase average ticket value and improve ancillary uptake.
For travel agencies, ancillary sales allow them to enhance their offerings. Both traditional agencies and OTAs can use GDS and Travel Portal development. This helps them access more add-on services. These services include premium transfers and hotel upgrades.
This not only expands their services but also helps create a smooth booking process for customers. This approach improves customer satisfaction and builds loyalty. This gives online travel agencies an advantage in an intensely competitive market.
Beyond airline-related services, integrating non-airline services such as hotels, car rentals, and destination activities can further expand revenue possibilities. Providing an “all-in-one” booking option through GDS creates a complete system. Customers can meet many travel needs in one transaction.
For example, Amadeus and Travelport let travel agents combine car rentals and hotel bookings. This makes it easier for customers and helps agents earn more commissions.
GDS platforms give travel agents tools to easily add upselling and cross-selling to their work. They provide personalized recommendations based on customer preferences and booking history.
Advanced algorithms and AI-based customer insights have empowered GDS platforms to create highly personalised and dynamic recommendations. For example:
Qantas successfully boosted ancillary revenue by proactively promoting special seat selections through the Amadeus platform. By analysing customer data, they tailored offerings to align with the preferences of high-paying business travellers, ensuring personalized recommendations.
These offerings included premium services such as access to enhanced airport lounges and more comfortable seating options. This strategic approach not only increased revenue but also elevated the overall travel experience for their most valued customers.
Using Travelport, an online travel agency improved its booking process. They offered customers personalized car rental suggestions based on their travel needs. By integrating this feature seamlessly into the booking journey, the OTA provided added convenience and value to its users.
This simple addition led to an 18% increase in cross-sell purchases in just three months. It shows how personalization can boost revenue and improve customer satisfaction.
AI-powered systems play a key role in optimising ancillary sales by analysing customer preferences in real-time. These advanced systems predict which add-ons a customer will choose. They use past behaviours, historical data, and context to create relevant offers.
With GDS integration, AI tools can easily access and process large amounts of travel and booking data. This helps provide more accurate and personalized recommendations. This integration helps airlines, hotels, and other travel providers show personalized options.
These options include seat upgrades, extra baggage, and travel insurance. They can present these offers at the right time. This leads to more revenue and a better customer experience.
Adding these features to online booking websites and travel mobile app development gives users a smooth and easy experience. They get real-time updates and personalized offers right at their fingertips. This greatly improves convenience and satisfaction.
Real-time analytics help travel providers change extra pricing based on seasonal demand, and how customers see value. Not only does this enhance revenue potential, but it also creates a sense of exclusive and urgency for customers.
Future advancements in GDS technology will likely include augmented reality (AR) and virtual reality (VR). This will allow customers to preview experiences such as hotel rooms, tourist attractions, and seating options. This immersive experience can drive ancillary sales and improve overall customer satisfaction.
Example: Providing a 360° VR preview of a villa rental through GDS platforms can spark interest. This may encourage travellers to upgrade their accommodation booking.
Combining GDS with extra revenue strategies is now essential for travel providers. This helps them stay competitive in a connected market.
By using personalized upselling, they can unlock more sales. Creating complete booking solutions is also important. The smooth mix of these tools can help airlines and travel agencies increase profits. It can also enhance the customer experience.
Businesses that focus on GDS innovation and data-driven solutions will grow their revenue. They will also become leaders in the travel industry of the future.
Think your business is ready to take the plunge into maximising ancillary opportunities? Start by evaluating your GDS capabilities and consider integrating AI-driven platforms to supercharge your sales strategy.
The travel industry is always changing because of consumer behaviour, new technology, and competition. GDS (Global Distribution Systems) play a key role by helping travel agencies and airlines connect with customers more easily. But alongside GDS, ancillary revenue strategies are becoming vital for maximising revenue and enhancing the customer experience. From upselling travel offerings to […]
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