I remember a thought-provoking question a client once asked when they were preparing to launch an airline: “How do we sell tickets?”
They were filled with excitement and ambition, eager to understand how the industry truly works.
At first, this question seemed straightforward. But the more I considered it, the more I realized how layered and complex the answer truly is.
Selling tickets isn’t just about listing flights online—it’s about building a strategic distribution network that connects passengers to available seats, maximizes revenue, and strengthens an airline’s market presence.
That question sparked a deeper reflection on what airline distribution really means—and why it’s the backbone of every airline’s success.
And that moment reminded me how critical a well-designed airline distribution strategy is, not just for startups, but for any airline looking to succeed in today’s complex markets. Let me walk you through what I shared with them that day.
What Is Airline Distribution Strategy?
At its core, airline distribution strategy is about how airlines connect their inventory—seats and cargo space to the travelers and markets they serve.
It’s not just about selling tickets; it’s about doing so in a way that maximizes revenue, reduces costs, and enhances customer experience.
The strategy revolves around two key channels:
Direct Channels
These include the airline’s own website, mobile apps, and call centres.
Direct sales give airlines control over the booking experience and often help reduce distribution costs.
Indirect Channels
These involve third-party partnerships with travel agents, Global Distribution Systems (GDS) like Sabre, Amadeus, and Travelport, and newer technologies like New Distribution Capability (NDC).
Indirect channels are vital for reaching broader markets, especially where travel agents dominate.
The balance between these channels isn’t just operational, it’s strategic.
The goal?
Optimize visibility and profitability while tailoring the approach for different markets.
Why Does It Matter?
When that client asked their question, what they were really getting at was, “How do we stay competitive?” Distribution strategy is the foundation of an airline’s ability to grow and thrive.
Here’s why it’s so important:
Market Reach: Every market has its nuances. In Australia, Sabre holds a 60% market share, while Amadeus leads in India at 90%. Understanding these dynamics ensures airlines are visible where it matters most.
Revenue Growth: The right distribution mix connects airlines with high-value customers, driving load factors and profitability.
Customer Experience: A seamless booking experience, like Emirates’ user-friendly website, builds loyalty and trust.
Without a solid distribution strategy, even the best airlines risk underperforming.
The Pitfalls to Avoid
Airline distribution isn’t without its challenges. Some common pitfalls include:
Lack of Local Market Intelligence: Using the wrong channel in a key market can lead to missed opportunities. Partnering with local experts or GSAs often makes the difference.
Over-Reliance on Direct Channels: Some low-cost carriers (LCCs) prioritize direct sales but miss out on the revenue potential of trade support.
Uniform Strategies: A one-size-fits-all approach rarely works in diverse global markets. Tailoring strategies for each region is essential.
Avoiding these pitfalls ensures better alignment with customer needs and market dynamics.How Legacy Carriers and LCCs Differ
When working with airlines, I’ve noticed significant differences between legacy carriers and LCCs when it comes to distribution:
Legacy Carriers leverage a blend of direct and indirect channels, often prioritizing GDS partnerships for their global reach.
LCCs focus heavily on direct channels like their website or app to minimize costs. However, this can limit their reach, especially in markets where agents dominate.
Both models have strengths, but flexibility and adaptation are crucial for sustainable growth.
The Future of Airline Distribution
So, what’s next? While drastic changes aren’t imminent, there are some exciting trends to watch:
NDC and GDS Harmonization: The integration of NDC content into GDS platforms may streamline operations and enhance efficiency.
AI Integration: Artificial intelligence could revolutionize distribution by personalizing offers and optimizing channel performance.
Sustainability: Airlines are increasingly looking at distribution strategies to promote greener travel options
While these innovations hold promise, the fundamentals of strategy, adaptability, and local intelligence remain just as critical.
The Takeaway
That client’s question—“How do we sell tickets?”—might seem simple, but it’s at the heart of every airline’s success.
A robust distribution strategy isn’t just about filling seats; it’s about connecting with the right customers, in the right markets, at the right time.
Whether you’re an established airline or just starting out, the key is a tailored approach. Balance direct and indirect channels, adapt to local markets, and embrace technology to stay competitive.
As someone who’s spent years navigating this complex landscape, I can say this:
Distribution is the engine behind every seat sold. And getting it right is the difference between thriving and merely surviving.
For more information about distribution strategy please refer to: https://www.anjunagsa.com/services.
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