BTN's 2023 Airline Survey & Report

"We recognize this was an interesting year with monumental changes, especially for corporate travel, so we're excited and humbled and thrilled about this win," Delta SVP of global sales Bob Somers said. "It shows Delta's commitment to corporate travel." 

Conversely, American Airlines, which last December announced its NDC intentions and carried through on them in April—pulling about 40 percent of its content out of traditional EDIFACT channels—remained in fourth place, with a score that plummeted 1.35 points to a total of 2.33, and with open-ended buyer comments noting that it has "given up on corporate business." American declined to be interviewed for this report.

In between, Southwest Airlines not only retained its second-place finish from last year but also was the only carrier to have its overall score increase, by 0.04 points to 4.19. United Airlines, which during the past 12 months expanded its NDC capabilities and increased its continuous pricing of tickets—capable only through NDC—remained in third place, but with a score of 3.78, 0.15 points lower than in 2022.

Yet, even Delta's numbers took a slight hit this year, by 0.08 points overall, and in all but one category—distribution channels, which was also its highest score at 4.5. And while Southwest gained in all but three categories—especially for distribution channels and quality of data and reporting tools, which each gained 0.23 points—United and American declined in every category for the second year in a row.

Nearly 43 percent of buyer respondents said that overall airline customer service had remained the same during the past 12 months, 31 percent said it had gotten worse, and slightly more than one in four (26 percent) said it had improved.

Buyer Expectations Rise, as Do Prices and Disruptions

Some consultants speculated that the mostly lowered results could be because travel buyers have higher expectations of carriers now that the industry has moved further away from the Covid-19 pandemic.

"The collegial spirit that got us through the Covid time was probably responsible for some slightly higher marks" in surveys during the Covid years, GoldSpring Consulting partner Neil Hammond said. But the "compensation factor for the pandemic has gone away."

Buyers now are very concerned about how airlines will position themselves with contract renewals and requests for proposals, Hammond added. "What is happening with the discounts [and] the value of their program? There are clearly some cases out there where buyers have the sentiment that some of the value of their program is under threat. … They have the feeling that [for] some of the airlines, corporate business is not their top priority."

"We've reached a new steady state post-pandemic, and the recovery looks different for every company in the managed travel space," United SVP of worldwide sales Doreen Burse wrote in an email. "As we make our updates to our strategies and programs to better our position and reach a new equilibrium, we understand the corporate segment might feel the compounding changes more intensely. As always, we're committed to transparency with our customers and giving as much notice as possible to make these changes more seamless."

Another theory is the perception that airfares are higher, even though they've leveled off in recent months. Average U.S. fares peaked in May 2022 at $628, according to Airlines Reporting Corp. data. This year, the average has been in the range of $514 to $571, with the most recent data showing an average of $537 in September, below the $560 average in September 2022.

Still, more than 85 percent of respondents said ticket pricing has significantly or somewhat affected their company's ability or willingness to travel for business the past 12 months. 

Multiple buyers noted in the survey’s open comments that they want "lower prices" and "more competitive pricing." One said that "a discounted corporate price should not be higher than a competitor's regular priced fare."

Airline and airport disruptions might have played a part as well. While the 2023 summer season didn't have as many hiccups as in 2022, inclement weather, pilot and crew shortages, and air traffic control staffing shortages continued to cause cancellations and delays. The U.S. Federal Aviation Administration even had to allow and extend into 2024 slot waivers for up to 10 percent of flights in the New York region, which in particular has been affected by the ATC shortage. As a result, nearly 83 percent of buyers said that these disruptions significantly or somewhat negatively affected their companies' return to travel this past year.

The Year of NDC

Then again, the generally lower results might have to do with those NDC changes after all.

"Could it be that buyer sentiment is aligned with [global distribution system] content?" Hammond asked. "I'm not saying it is, but it could be we are seeing buyer sentiment toward the airlines as a reflection of [their] position or commitment to GDS content. … Delta was the least vocal. Southwest is adding more content to the GDS. United has its continuous pricing model, which means there is disparate content. And the market is well aware American has tanked with NDC full content and rationalizing its corporate programs. Yes, I would say it has impacted buyer sentiment." 

CapTrav president and KesselRun partner Brandon Strauss agreed that "buyers are obviously frustrated with what they are seeing with American and are starting to show some frustration with United as well," he said. "I would expect it to probably get worse on the United side, because I don't think the real impact of continuous pricing has been fully felt or digested yet. It's more opaque … and nebulous. You found a price, but now it's gone. You can't access it through the GDS. It will trend over time even worse."

Hammond's and Strauss' assessments seem plausible. When asked about the impact NDC has had on programs, 43 percent of respondents said it had a significant negative impact on access to fares and traveler perception of program credibility, while 22 percent said it also was negative, but limited to carriers not critical to programs. Just 8 percent said it was either significantly or slightly positive, while 12 percent said it had no impact.

In the survey's open-ended comments, several buyers noted their concerns about NDC, their frustration with American's NDC moves—and its essential dismantling of its corporate sales department—plus their hope that other airlines would remain "transparent about NDC" and wait "until the ecosystem is ready."

Partnership Travel Consulting SVP of global supplier programs Bob Brindley noted that NDC and continuous pricing can create pricing discrepancies. "The pricing is different on some carriers, dramatically different, creating a lot of headaches for corporate travel managers," he said. "In one case, we know a client where the CEO called up and said he booked a flight $1,200 cheaper than through the online booking tool. That creates a lot of additional challenges for the corporate travel manager to manage through."

While Delta is still on the NDC sidelines, Somers said the carrier is working on a solution to drive mutual value and is targeting 2024 to release it, "but not until it's ready," he said. That 65 percent of survey respondents who indicated NDC is negatively affecting their programs, he said, "tells us what is out there now is not what is needed."

"The person leading Delta's NDC journey is talking to corporate partners on how we work [on] this together," Delta VP of sales operations and development Kristen Shovlin said. "It goes back to partnership. Without it, it doesn't work."

United, too, has "sought input from our industry partners to help us make more informed and empathetic decisions—and the feedback was clear and helpful," according to Burse. "Through the changes, we have been transparent providing our customers with ample timing and resources to make any necessary adjustments. For example, United hosted webinars with our corporate and agency advisory boards to share progress, impact and concerns."

Burse added that by enabling an omnichannel approach to distribution, "our contracted corporate customers can bring United's channels into their managed travel program," she said. "This offers them a number of benefits such as increased savings by ensuring any booking or exchange is inclusive of corporate negotiated discounts, duty-of-care capabilities, and more efficient workflows that utilize data feeds to expense providers."

Hammond noted, though, that for some buyers, even if they wanted to turn on NDC, they couldn't because "many of them have a booking tool which does not provide NDC content or GDS NDC content," he said. Further, they might remain left out because "they're in a shared pseudo-city code environment, and you cannot switch on NDC content with EDIFACT content and have it side by side. You have to preference one or the other."

Strauss, however, sees NDC as a "red herring."

"Airlines promoted NDC [strategies] despite the fact that there was no plan in place to execute against it, to service those reservations, or even to serve them up in a traditional environment, in addition to making it extraordinarily challenging to even adopt those standards. On the back end, what you are seeing is a huge push to move people directly to their websites to create brand loyalty," Strauss said. "This now has been proven out with American's announcement on their SMB program [which favors direct bookings]. United's move around continuous [pricing] has the definite possibility of being far more impactful than NDC. I'm not convinced that airlines care about NDC at all. I think it's a little bit of a false flag that they know probably doesn't win the day, but they recognize what probably wins the day is getting more brand loyalty from customers."

Strauss added that while "traditional buyers are showing displeasure about this stuff, I think it also creates an opportunity," he said. "Their programs become more complex to manage, but the opportunity potentially becomes greater if they rethink what the definition of a managed program really is. … Travel managers who put their head in the sand and just say, 'American is treating me horribly, there is nothing I can do,' they are in trouble. Others will realize they have to adapt their program to optimize what they have—and there is still a lot to optimize. If you are a good travel manager, you can clearly demonstrate the ROI of managing your travel program whether or not a portion of bookings are going outside the travel agency."