Just how important is it to the airlines to have ancillary sales available through online travel agencies? Very, it would seem, based on the initial stats released this week from the Airlines Reporting Company (ARC). ARC is the group established in the United States to handle transaction reconciliation between airlines and travel agencies and they’ve shared some interesting numbers from the first couple weeks of work between American Airlines and Priceline.
The two started working together through American’s Direct Connect platform at the end of July and this initial report from them indicates that the ancillary transactions are happening at a pretty decent clip. More than 2000 Electronic Miscellaneous Document (EMD) transactions have been processed by ARC since July 31st, more than 100 per day on average. These EMDs represent payments for assigned seats on AA flights at the time of the initial ticket purchase rather than after the fact through the AA website.
The connection between Priceline and American is the first integration of the carrier’s Direct Connect platform with a major online travel agent booking site and the initial data suggests that these sorts of transactions can mean millions to the airlines annually; no real surprise then that they are pushing hard to get travel agents to shift to this sort of arrangement. It is a bit of a surprise that they are willing to forego some sales channels and pursue lawsuits on the topic, but when millions of dollars are at stake I suppose nothing should be too surprising.
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