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10 November 2024

2024 WFS-WPS: Key Takeaways through the MAR Transition Lens

The IATA World Financial Symposium and World Passenger Symposium (WFS-WPS) 2024 edition in Bangkok brought together over 1200 industry leaders and experts to discuss the industry transformation in the context of Modern Airline Retailing (MAR). It covered all airline functions affected from Commercial, Payment, Finance, IT to Airport delivery.
  
This year’s event highlighted significant advancements and trends that are shaping the industry. From the growing adoption of NDC (New Distribution Capability) to the emergence of Orders, the symposium provided valuable insights into the ongoing transformation of airline operations.  

Let us delve into the key takeaways from the event and explore how these developments are paving the way for a more modern and efficient airline industry:  

  • The adoption of NDC continues to grow: 
    - A recent survey of 150+ airline representatives with hands-on Offers and Orders implementation, revealed that 81% of surveyed airlines now have live NDC channels and are actively transforming their operations.
    - The significant shift towards MAR was also confirmed by the overall tone of the symposium approaching NDC as just one step in the broader journey to 100% Offers and Orders - the only way to true customer centricity.
  • While the implementation of Orders is still in its early stages, progress is evident: ​​
    - The first business cases for 100% Offers and Orders have emerged, and several others are in the exploratory phase.  
    - IT providers, crucial enablers of this industry transition away from legacy systems like e-tickets, PNRs, and EMDs, are investing heavily. Currently, there are nearly 40 proof-of-concepts (POC) and pilots in progress, and all providers support the principle of a modular architecture. 
    - Leading airlines are planning to start processing Orders from 2026; and some even as early 2025. 
  • Interlining within the context of MAR is also gaining traction:
    - Offers & Orders Partnerships are expected to go live for the first airlines in 2026, with higher implementation volumes projected by 2028.
    - There are 11 pilots underway, and 12 IT providers are expected to be ready by 2026, covering both Offers and Orders and the Partnerships scope. 
  • Payment strategies are becoming increasingly important as part of value creation in MAR:
    - In the 2024 IATA Global Passenger Survey, a significant 77% of global passengers expressed interest in using a digital wallet for payment, for digital ID, and for loyalty.
    - As airlines are able to offer more payment solutions, conversion will increase, in line with customer demand.
    - Developing a robust payment strategy is essential for reducing costs and enhancing revenues.
    - The transition to MAR with 100% Offers and Orders integrates payment into the product offering and customer experience, rather than treating it as just a support process. For some airlines, payment has now become ‘mission critical’.
  • Addressing functional silos across organizations is seen as a priority:
    - Pre WFS-WPS, we brought together, for the first time, all three of IATA’s Advisory Councils (Distribution Advisory Council, Industry Financial Advisory Council, and Digital Transformation Advisory Council) and their members across distribution, finance, and IT. This underscored the importance of cross-departmental alignment and scaling the MAR transformation.
  • Finance and financial management are increasingly recognized as key partners in this transformation:
    - Airlines are beginning to integrate finance into the core of their retailing transformation, simplifying outdated financial processes, and addressing interline issues.
    - The Divisional VP of Financial Services at Singapore Airlines and Chairman of the Industry Financial Advisory Council (IFAC), reaffirmed IFAC’s support for the MAR transformation and acknowledged the significant contributions of airlines and technology providers in defining the future state of financial management in alignment with the MAR vision. 
    - The expertise within legacy Revenue Accounting teams is invaluable for designing future solutions and facilitating the shift of key controls from the back office to the Offer and Order level.  
    - Some of these solutions are nearly ready, ensuring that as airlines move to Orders, they can account for them seamlessly and in alignment with future financial management principles. 
  • The increasing realization of the need for cross-functional project teams is reflected in the collaborative Standards Development approach:  
    - Airline Chairs of the Shop-Order-Pay and Settlement-Accounting standards boards highlighted the interdependencies and the collaborative approach under the Passenger Standards Conference (PSC). 
  • A fully digital end-to-end travel experience is no longer a mere fiction:
    - A POC deployed by IATA and partners (Cathay Pacific, Hong Kong International Airport, Narita International Airport, Branchspace, Facephi, NEC, Neoke, Northern Block and SICPA) was successfully delivered in time for the Symposium, with airport elements conducted in a live environment, building on an initial PoC carried out in a test environment in 2023.   
    - An increasing number of airlines are exploring how future processes will benefit modern Orders and Digital Identity technology. 
    ​​​​​​- The first findings are encapsulated in the latest Airline Retailing Consortium release: “Modern Airline Retailing: Leveraging Orders and Digital Identity to Enhance the Customer Travel Experience”. 
  • The Business Reference Architecture (RP 1786a) helps airlines to strategically plan and engineer their MAR transformation, while ensuring cohesion across all key functions and departments within the organization – from Product to Offer, Order, Delivery, and Finance.  
    - And so, the question you need to ask yourself today is: Are you RP 1786a-ready?
  • The transition to MAR now has its first high-level industry roadmap, which covers all players across the entire value chain, with key dates and milestones:
    - It is based on current knowledge, with added projections and it will evolve. 
    - To realize the full benefits of Offers and Orders, it is critical to ensure that all stakeholders are aligned and progressing towards the same goals.
  • Standards remain the backbone of the transition and the PSC has laid out a robust and ambitious project plan to be completed by 2026:
    - This plan prioritizes several critical areas: Offer-Order management, Product Taxonomy, Supplier Catalogue, Tax Data integration in Offers and Orders, Complex Order Servicing, Seller Risk Management, and the exchange of Interline Offer and Order data.  
     

In conclusion, the Bangkok edition of WFS-WPS demonstrated significant strides on the MAR transformation journey, with growing collaborative efforts not only across the key value chain stakeholders groups (Airlines, IT Providers, Sellers), but also functions including Payment, Finance and IT, underscoring the importance of cooperation and cross-departmental alignment in achieving these ambitious goals. 

 

Explore some of these areas in more detailed articles in our IATA Airlines Magazine >>

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