When a person books a flight, less than 15 minutes pass between their starting to fill in the search form and a ticket appearing in their mailbox. From the airline side, it involves many events and systems to issue a ticket and make sure that the right person will board the plane. In this article, we describe the flight booking pipeline and explain the main processes supporting it.
Airline distribution: How does it work?
Let’s start at the very beginning. And in this case, it’s the way airlines distribute their tickets. This process is comprised of several systems, which we’ll detail in the sections below.
The first one is the Global Distribution System (GDS), a network system connected to numerous flight providers. GDS aggregates content of airline inventory, schedules, and fares. The system collects this data from the following sources:
- Airline Tariff Publishing Company (ATPCO) for public and non-public fare collection and distribution, and fare-related content;
- airline Passenger Service System (PSS) for inventory and ancillary services.
The key GDS providers are Amadeus, Sabre, and Travelport. They provide not only flights but also car rental, hotel, and ancillary booking. To learn more about GDS, watch our video below.
Passenger Service System (PSS) is a software solution used by airlines that comprises a central reservation system (CRS), airline inventory system, and departure control system (DCS). The CRS is responsible for inventory management and ticketing, an airline inventory system defines a general number of available seats, and a DCS processes the check-in. Also, PSSs includes data storage and an Internet booking engine for direct booking processing, and a merchandising system for ancillary distribution. We’ll look at these systems closer later in the article. Some key players among PSSs are New Skies by Navitaire, Altea by Amadeus, and Avantik by Bravo Aero.
All the systems mentioned above are connected via APIs or an EDIFACT protocol and distributed via GDSs. So, if an Online Travel Agency (OTA) wants to access flight information, it must connect to a GDS or third-party API for fares and schedules. As a result, airlines can’t get access to customer data and have to deal with fees for GDS distribution. New Distribution Capability (NDC), introduced by IATA, is a new standard that was created in the hope of replacing the existing communication system. The NDC’s main advantage is that it can share the full content from airline API, which enables airlines to access customer information, personalize user experience, and sell ancillaries and seats from one source, bypassing most of the third parties. Today, dozens of airlines and IT companies have adopted NDC capability, but GDS is still the main distributor in the industry. Read our take on the NDC in the corresponding article.
With some basics covered, let’s describe the chain of processes between the moment of booking and baggage reclaim at the destination airport. The whole process of this traveler/airline interaction can be divided into five steps: seat booking, ancillary booking, payment, ticket confirmation, check-in and boarding, and baggage reclaim.
Today, when a traveler or a travel agent books a flight, they have a choice: Use either an indirect or direct booking channel. The first one includes OTAs, like Expedia or Priceline, GDS, if an agent books for the traveler, or metasearch engines, like Kayak or Skyscanner. The second option is a direct booking from an airline website. The choice of booking channel — indirect or direct — determines the slight difference in the process.
1. Flight search
Indirect channel: OTA, GDS, metasearch engine. A user looks for the right flight via a flight booking engine on a third-party website or via a GDS terminal. As the flight is chosen, a third-party sends the request to the GDS, which accesses the airline’s CRS.
Direct channel: Airline eCommerce website. If a traveler books directly from the provider, the process skips the whole GDS part and goes straight to the CRS.
2. Reservation management
CRS’ basic functions are inventory and reservation management, passenger name record (PNR) generation, payment gateway integration, customer information management, booking and cancellation management, refund management, and email notification. While booking a flight, a customer can select a seat right away, but as a rule, airlines charge an additional price for this. Otherwise, the seat can be selected during online check-in or be randomly assigned. After a user pays for the ticket, a system generates a PNR — a personal code that contains a traveler’s information and their itinerary. An airline uses a PNR to easily track the passenger’s record and exchange information between different airlines. We will discuss its use a little bit later.
Ancillary revenue reached $65 billion worldwide in 2018, remaining a major source of airline revenue, especially for low-cost carriers. Additional service booking and distribution are handled via Merchandising Systems that we mentioned earlier.
3. Choosing additional services
Ancillary services include an ability to reserve a particular seat, additional baggage, extra legroom, or in-flight meals. When a traveler adds ancillary services during the booking, a Merchandising System generates special service request number (SSR). It’s a message to the supplier with a request for any ancillary service that’s usually included in the ticket.
Besides selling extra services, Merchandising Systems are also responsible for dynamic pricing and discount offers. Some systems also include such services as changing the date and name on the ticket. An example of such a system is a Global Merchandising System by Amadeus. It can retrieve a traveler’s PNR and amend it for a fee.
4. Using loyalty programs
Loyalty program operations are usually managed by airline merchandising systems, too. Being a member of a frequent-flyer or airline loyalty program, a passenger can use earned miles accumulated from each flight, or points for purchasing extra services from airlines. These points can be exchanged for discounts or benefits, like upgrading to business class. Depending on the airline, customers can either log in via their accounts while purchasing tickets directly from an airline website or get a loyalty program participant’s number to use for booking from a third-party. Also, these systems keep a particular number of places for frequent flyers reserved in CRS.
Fares and payment
To receive a ticket with a PNR (sometimes called a booking confirmation number), a traveler must pay the fare. A fare is the amount of money a person must pay for the seat, taxes, and third-party service fee if any. The fare can also include a charge for ancillary services.
The allocation of fees between airlines, GDSs, OTAs, and customers works the following way:
- Airlines pay GDSs for distribution
- GDSs then pay OTAs to close the sale
- Travel agents booking from the GDS terminal pay a fee for using its service
- Customers booking via an OTA sometimes pay a service fee
If it’s direct booking, a customer pays the airline’s payment gateway directly and as soon as the payment is processed, a CRS is notified and generates a booking confirmation number. If the booking is made via OTA or metasearch website, they use their own payment gateway.
5. Payment processing
A payment gateway is a third-party service that not only processes all financial operations between customer and merchant, it also ensures data safety. The main operations of a payment gateway are authorization (checking that a user has enough money to pay), capture (sending the funds to the merchant’s account), sale (regular payment for purchases), a refund (money return), and void (a refund for not-captured funds). The advantage of this service is that a customer can book and pay in one place, but a big disadvantage is that all the processes like cancelation and refund are completed through the OTA side, not through the CRS. And one more disadvantage for travelers: When booking via OTAs, they pay an additional fee.
As soon as the payment was processed by the payment gateway, the airline’s CRS can generate a booking confirmation number and issue an electronic version of a ticket. Let’s take a look at this process.
The flight ticket is an agreement between a traveler and a carrier. It makes ticketing a key part of this process. Obviously, there’s no chance to get on a flight if there’s something wrong with a ticket, like an incorrect name entered.
6. Personal name record (PNR) generation
Ticketing is a different concept from booking. Ticketing means that the seat is paid for, it won’t be taken, and it belongs to a particular person. This is ensured by a PNR. It’s a 6-digit code on an e-ticket that allows airlines to validate the booked seat. If it’s a trip that consists of several flights by different airlines, an interline booking occurs. For such cases, airlines create an interline commercial agreement for codeshared flights. Regarding this agreement, different airlines issue a single ticket with one PNR, which is issued by one of the airlines as defined by an agreement.
7. Super PNR generation
Sometimes an airline issues a single PNR for a segmented flight known as a super PNR. In this case, the system generates several PNRs that are included in one. Each number in this code represents details of the seat: class, ancillaries included, etc. After the ticketing, the traveler receives a booking confirmation from the OTA or airline with their name, schedule, airport IATA codes, and the price of a ticket, as well as an e-ticket with a PNR reference from an airline. At the next stage, a traveler would need an e-ticket.
Check-in and boarding
Here we deal with the airline’s DCS, the departure control system that we mentioned earlier. This system is a part of PSS, connected to CRS and airport devices like self-check-in kiosks, agents’ software, baggage drop, and even immigration control. DCS processes all check-in and boarding-related procedures, which starts with ticket validation. Also, this system is responsible for entering customs and border security reservation, as well as aircraft weight optimization and cargo handling.
During check-in, a traveler must provide their PNR and name so that the system can match it with existing ones in the CRS and assign a seat. This process slightly differs online and offline.
Online check-in. Online check-in usually becomes available 48 hours before the flight, but it depends upon the airline. A traveler enters details from an e-ticket at an airline website or an app and gets access to an aircraft seat map to choose a particular seat. If a user doesn’t choose it, the system randomly assigns a free one and issues an electronic boarding pass. The same principle works for check-in kiosks.
Airport check-in. Checking-in at the airport, a person brings an e-ticket to the airport agent at the check-in counter, so that they can enter the details and reserve a seat, or several seats on different planes if it’s a segmented flight, on a seat map and check the baggage in. As a result, an agent issues and prints a boarding pass.
9. Boarding pass issue
The boarding pass is a document that identifies a passenger and a flight, and gives permission to board a plane.
A typical boarding pass has a PNR, flight information like destination, date, time, gate, and a seat number, and a QR code. DCS generates it for each boarding pass. As the passenger proceeds to the airplane, a QR code is scanned and PNR status changes from “checked-in” to “boarded” and, finally, “flown.”
Baggage handling and reclaim
A plane has landed at the destination point, and it seems like this is the end of a journey — unless a passenger’s baggage is lost. To avoid this and make sure that passengers get their baggage safe and sound, airports assign a unique 10-digit code for each item. Based on a flight’s itinerary, airport baggage management systems like SITA’s BagManager or ARINC SmartBag generate code and issue a baggage tag with it each time luggage is checked-in through an airport agent or a self-service drop.
10. Baggage tracking
Baggage management systems are integrated with airports and airlines via APIs. When the baggage is handled, it goes straight to the baggage handling system, where the code is scanned.
As soon as the baggage handling system scans it, the code appears in IATA’s worldwide baggage tracking system WorldTracer. This system offers a number of modules for tracking and matching baggage, and every airline-member of WorldTracer Distribution Network (WTDN) gets access to them.
A passenger can enter the code and name on the airline’s website in the appropriate field to learn their baggage status.
A few more words on flight booking
Since there are no ticket agents anymore and you don’t need to call them to reserve a paper ticket, today’s flight booking pipeline is considered to be simpler than before. But still, a single booking requires a number of different operations, all bound to one another. Most of these processes remain overcomplicated by numerous connections to different services, systems, and distribution channels. As innovations are adopted by both airports and airlines quite slowly, there still are GDSs and multiple airline flight booking APIs to ensure seat, ancillary, and fare distribution.
Originally published at AltexSoft tech blog “Flight Booking Process: Structure, Steps, and Key Systems”