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Published on : Monday, June 15, 2015
Following a strategic partnership established in 2013 that saw SAS’ highly experienced revenue management experts join Amadeus, the airline has now completed its migration to Amadeus Altéa Revenue Management Suite. The migration lays the foundation for the most accurate and intelligent pricing of airline packages and offers.
As the airline industry looks to new merchandising methods, such as dynamic pricing, fare families and ancillary service sales to increase revenue, it is crucial that revenue management processes are fit for purpose. Revenue management solutions play a significant role in providing recommendations on the best price and packaging of airline offers. Next-generation revenue management techniques are therefore critical for airlines seeking competitive advantage from merchandising.
As a response to competition from low cost carriers and more transparent price-comparison tools, full-service airlines have increasingly adopted flexible fare structures. This business strategy challenges legacy revenue management systems, which forecast an increase in demand in low price booking classes and a decrease in high profit classes. This results in an inaccurate picture of consumer demand, as systems cannot adequately understand travellers that buy low price flight tickets, but still expect optional extras to add to their flight ticket. The Amadeus Altéa Revenue Management Suite is specifically designed to overcome this phenomenon, known as the ‘buy-down effect’, which is the single biggest lost revenue opportunity for network airlines today, and to help airlines adequately respond to increased competitive pressure.
Tobias Jönsson, VP Revenue Management at SAS said, “Today, network airlines are suffering with complex revenue management IT solutions and the ‘buy-down effect’ when it comes to taking control of revenue. However, we are excited to be working with Amadeus on a solution which tackles these issues and is fully integrated with our other Altéa systems.” Jönsson continued, “Our migration to Amadeus Altéa Revenue Management was completed seamlessly and lays the foundation for us to optimise the pricing of both flight and, in the future, ancillary services.”
Julia Sattel, VP of Airline IT, Amadeus, added, “Amadeus is ideally placed to deliver this unique revenue management solution due to our ability to use more accurate and complete data drawn from the Amadeus Altéa Suite, various other Amadeus and external sources, and a wide range of accurate, real time data from the airline itself.” She continued, “The end-to-end nature of the approach enables greater automation and means SAS will now be able to correctly price relevant offers for travellers, automatically registering when travellers are also purchasing ancillary services. This solution will support our vision for a truly traveller-centric global travel ecosystem.”
This cut over will enable Scandinavian Airlines to take advantage of a unique solution from Amadeus’ Airline IT portfolio, with a system that is built to withstand change and future growth, furthering its reputation as a leader in O&D revenue management. The highly automated system frees revenue management analysts to focus on activities that create further value for the airline and empowers them with user-friendly, real-time tools.
This migration follows a long-term strategic partnership between Amadeus and Scandinavian Airlines, signed in 2013, under which a groundbreaking ‘Centre of Competence’ was established. The agreement saw more than 20 SAS employees, many of whom were experts in the field of revenue management, join Amadeus to pave the way for future innovation that can benefit the entire Altéa community.