SWISS realigns its distribution strategy

Published on : Wednesday, June 3, 2015

swissSWISS’s New Commercial Strategy was ushered in last year with the relaunch of the swiss website with its new and more user-friendly design. The new strategy also already extends to a new and clearer pricing policy that includes innovative one-way fares and attractive introductory fares for Business Class travel.



New clearer fare options more closely geared to needs



The next major step will follow on 23 June (and at a later date for the further airlines of the Lufthansa Group) through the adoption of a new modular and flexible fare concept for travel within Europe, with tailored fare packages and further add-on services. The new concept with its new “Light”, “Classic” and “Flex” Economy Class fares enables customers to choose precisely the fare package that meets their specific travel needs and, in doing so, pay only for the services that they actually require. The new concept will be backed up with even greater personalization to address each customer’s particular travel wishes and needs.



Clearer cost differentiation in distribution channels



The New Commercial Strategy extends to SWISS’s distribution strategy, too, where a clearer cost differentiation should now be achieved between the various distribution channels. At present, the costs that SWISS incurs by using the global distribution systems (GDSs) are substantially higher than the costs of other booking channels such as its own online portals like In fact, annual GDS costs total a triple-digit million-euro amount for the Lufthansa Group airlines alone. At the same time, many of the services offered by GDSs that extend beyond the simple ticket booking and issuance process – such as combining the global products of various airlines and further service providers, or integrated booking and invoicing processes – are only partially used by the Lufthansa Group’s airlines, even though they are paid for in the corresponding GDS fees.



In view of this, the airlines of the Lufthansa Group are to introduce a new Distribution Cost Charge or DCC of CHF 16.00 per booking for all tickets which are issued via a GDS from 1 September onwards. At the same time, tickets for which no DCC will be charged will in future be available via all the carriers’ own booking channels, call centres and airport ticket offices. Travel agencies will also be able to book tickets without the DCC, by using the online portal. And corporate customers will be able to book travel at their own agreed corporate rates (also with no DCC) .



NDC pilot project in trial phase



Innovative new additional services and more sophisticated fare offers require appropriate distribution technology, too. And with their current technical standards, existing distribution systems cannot adequately differentiate the full product range with all its various elements. In view of this, SWISS is currently working with its sister Lufthansa Group airlines to develop a new booking channel that will directly link distribution partners to the carriers’ IT systems using IATA’s New Distribution Capability (NDC) data standard. A first NDC pilot project has been in a trial phase at SWISS since last year.



“Airlines today cannot yet market their products via all the available distribution channels, as is customary in most business sectors,” explains SWISS Chief Commercial Officer Markus Binkert. “But the times of ‘One size fits all’ are well and truly over, in both product offer and distribution structure terms. Up till now, the corresponding contractual agreements and structures have hampered any liberalization in many areas here. We want to change this with our new distribution strategy. We want to bring greater freedom to our online and physical distribution channels, to offer our customers precisely the products and the services they are seeking to meet their specific and individual travel needs.”



Swiss International Air Lines (SWISS) is Switzerland’s national airline, serving 106 destinations in 49 countries from Zurich and Geneva and carrying over 16 million passengers a year with its 95-aircraft fleet. The company’s Swiss WorldCargo division provides a comprehensive range of airport-to-airport airfreight services for high-value and care-intensive consignments to some 120 destinations in over 80 countries.As “The Airline of Switzerland”, SWISS embodies the country’s traditional values, and is committed to delivering the highest product and service quality. With its workforce of some 8,250 personnel, SWISS generated total operating income of CHF 5.2 billion in 2014. SWISS is part of the Lufthansa Group, and is also a member of Star Alliance, the world’s biggest airline network.



Source:- SWISS


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