New Distribution Capability (NDC) and its Effects on Travel Industry in Oman

Purpose: The objectives of the study were to analyze the effects of transformation from GDS to NDC from the perspectives of the travel agencies in Oman; to find out the concerns of the travel agencies in Oman with regards to the implementation of NDC and to compare the benefits of NDC content with GDS from the perspectives of the travel agencies in Oman.

Design/methodology/approach: A questionnaire survey, telephone, and personal interview were conducted with 19 top leading travel agencies in Muscat region, Oman. Each travel agency manager was given the questionnaire through online. The telephone/ personal interview was also conducted. Around 78 employees were targeted out of which only 13 responded. The data collected was analyzed using Statistical package.

Findings: The findings support the fact that Oman being a small market with many small and medium players’ implementations of NDC is slow. The current pandemic has slowed it down even further. But the travel agencies should be offered help in terms of training and awareness by the NDC platform and some major airlines to speed up the adaptation. The study showed that the high cost of technological implementation is going to be one of the major barriers to complete switch to NDC system. As of now, the travel agents will be settling for GDS with NDC.

Research limitations/implications: The adaptation by NDC has been slow especially by airlines. With IATA pushing the implementation, major airlines are slowly but surely adapting it as they can see the benefits they can derive. The customers too are benefiting from direct buying. The travel agencies in Oman especially small and medium-sized travel agencies are the ones who are most affected and there is not enough research being done to find what is stopping them from adapting.

Social implications: The pandemic has devastated the travel industry overall. Many small and medium businesses have been forced to shut due to lockdowns. Further, the customers have got used to online shopping at discounted and competitive price. Under such scenario it will take the travel agents some time to start enjoying the same levels of profit margins as the pre pandemic days.  This will have an impact on unemployment as well as the inability to meet loan commitments. This can have a ripple effect.

Originality/Value: Few academic research has been carried out on NDC, especially in the Middle East. This research is the first of its kind which is dedicated to travel agents from Oman. The fact that NDC is set to revolutionize the shopping experience for the consumer one cannot ignore the fact that it is set to blow a dent in the revenues of the Travel agents.