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15 Sep 2016

Why local partners always pay in the long-run

There’s no longer any debate that good tech is the key to effective travel management, but the ‘best-in-region’ vs ‘global’ solution, question remains. Or at least it did, until last week.

To keep pace with fierce competition in what is essentially a commodity marketplace, airlines are being forced to reinvent themselves on a regular basis. Over the last two years, local airlines have made some significant changes to the way that they package up their goods and services, (think Seat and Bag) – all with the goal of differentiating themselves from their competitors, growing market share and improving their yield.

For the airlines, implementing these changes is a non-trivial exercise. There’s both a huge internal systems piece of work required, to support new product packaging and a massive marketing investment to make sure everyone understands what just changed. However that’s not the end of it. In fact, for companies like Serko it’s just the beginning.

When airlines make changes to their pricing and packaging, those changes have to be reflected in all of the third-party systems - like Serko Online - that sell flights on behalf of the airlines. Sometimes it’s quick and easy to change, but sometimes it’s not. Airlines give everyone plenty of notice of change, but the sheer volume of change going on, can cause something of a development log-jam. The problem of course, is that if an airline makes a change and the companies that sell on their behalf aren’t ready, then the wheels start to fall off the bus.

Take two very recent examples – Jetstar’s new Flixibiz bundle that directly targets the business community and Virgin Australia’s ‘Fares for You’. If you work in Australia or New Zealand and you travel for business, then these changes are important. They make Jetstar a practical and economic alternative to Air New Zealand, on common routes and they allow Serko Online users to purchase VA's Getaway fares, as an upgrade option from the Go Plus fare, (which is the cheapest option in the fare band). 

Because we are local and because we understand that these things matter to our customers, we quite literally drop everything, to ensure that we’re able to sell and support all of these new packages, the second they go live. The Jetstar and Virgin Australia changes are no exception. They are there, ready to go inside Serko Online, right now. And the next time they make a change the same will be true.

So the pertinent question, business travel buyers in Australia need to ask their ‘Global’ OBT providers is, ‘when will these changes be available?’ Based on what we’ve seen and heard from the market, you may be very surprised. Or alarmed. Or both.

The conclusion to all this is very straightforward. If you buy for business in Australasia and you rely on local suppliers, then your only option, is to rely on a local provider that cares about local conditions. It really is that simple.

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