Big Interview: Sabre Google partnership promises a 'golden age' of travel retail

Lee Hayhurst sat down with Mike Reyes, Sabre vice president of platform product management, at the recent T2RL 'Engage' conference in London to hear more about its vision for supporting retailers that are ambitious to become the 'Amazon of travel'

The COVID pandemic has accelerated efforts to sunset the traditional travel technologies and this is expected to usher in a golden age of travel retailing.

Mike Reyes, vice president of platform product management at Sabre, foresees one of the fallouts of the pandemic will be travel firms adopting tech to become better digital retailers.

And he says this is what underpinned Sabre’s exclusive partnership with search giant Google agreed before the pandemic and its focus as the crisis fades and travel looks to the future.

“We had a decision to make at Sabre,” Reyes said, “do we retrench or do we look ahead at what travel will look like coming out of this and what do we want to be.

“And we made a decision to make a bit of a transformation to help our customers be better retailers. 

“With everyone sitting at home and no one flying, the pandemic emboldened us to say what do we think airlines will be looking for.”

Reyes was speaking to Travolution at the recent T2RL ‘Engage’ airline conference in London where he gave a keynote on Sabre’s vision of a digital retail revolution in travel.

He said with airlines’ historic data rendered worthless by the pandemic, the focus has to be on accelerating the use of Artificial Intelligence to be more attuned to customer needs.

Sabre decided before COVID to end its multi-source technology strategy and to work exclusively on Google as it retires its own legacy mainframe systems and shifts to the cloud.

Reyes said it chose Google as much as Google chose Sabre because, despite its own in-house travel IT expertise, the search giant needed a travel partner with a shared vision.

“We started thinking about what does it mean when we are fully off mainframe. What it was about was could we have a shared vision of a tech partner not just a tech vendor.

“They [Google] were trying to grow their market share. But they look at it in terms of how many companies in the next years are going to go through a transformation, getting out of legacy technology and moving towards cloud. 

“The pie is going to be several times bigger than it is today. They chose to say they want strategic partners in a host of verticals, including travel, that they can invest in. For us Google were clearly the best in class.”  

Although Sabre and Google are technically competitors – ITA software, that was acquired by the search giant for $700 million in 2011, still sits behind its Flights product – travel retailing remains a small part of its overall business.

It was Google’s expertise in developing and creating online marketplaces that brings buyers and suppliers together that interested Sabre.

Reyes said as the world of digital retailing evolves from more traditional “rules-based” advertising to machine learning, personalisation and customer segmentation the Sabre Google partnership will provide cloud-native tools for travel.

This new world is challenging old models, and the aviation sector specifically, and what the future looks like as New Distribution Capability (NDC) rolls out is emerging but remains to be seen. 

“Change is not comfortable in any industry,” said Reyes. “We want to get to a position where commercial considerations are less critical. No one has really figured out what the new commercial model will look like. 

“What we decided was that’s going to play out the way it’s going to play out. It’s not as much trying to push one model over another but trying to create value for the customer. If you do that the commercials will take care of themselves.”

Reyes said NDC will make the distinction between direct and indirect more “fuzzy” in travel as barriers to entry reduce and as airline suppliers take more “control of the conversation” with the end consumer.

“NDC is not the be all and end all. For us it’s more valuable to have the technology to connect buyers and suppliers. Airlines, hotels, car hire companies are all going to look more like OTAs. Consumers come in all shapes and sizes, it’s understanding the context.

“We do not want to forecast how it’s going to change. What we decided was it’s better to be in the room and trying to connect buyers and suppliers and creating that value in the pipes along the way.

“If we’re allowing better conversations whether on airline.com, an OTA or online booking tool we’re creating value for our partners helping them sell more ancillaries and finding new customers. Do that, and full content and parity agreements take care of themselves.

“It’s interesting to see how Google approaches this because they run a massive marketplace for buyers and suppliers. They’re not as encumbered as some people are in the travel industry with long-term contracts, guarantees and minimum targets.

“We are still competing with Google Flights in some respects but that’s a very small part of their business. This is about being very collaborative, about how we can fast track things on to cloud.

“Talk to any airlines, they are not interested in another PSS. What they are talking about is the path to eventually sunset their traditional PSS, where the booking, marketing, inventory management check-in are all from one single vendor, of which we are one.

“COVID has accelerated this willingness to be different, to stand out, that we have been talking about for the last five years. Our strategy is not to try to build a sole vendor PSS, it’s to talk about marketplaces and retailing and allowing airlines to become the Amazon of travel.”

Talk of the ‘Amazon of travel’ is such an over-used soundbite as to make it almost meaningless, so much so Reyes is almost apologetic whenever he refers to the global giant of online retail to explain his vision for the future.

But he says the evolution of air ticket retailing that is happening, away from legacy PNRs to Iata’s vision of offer and orders, mirrors how Amazon moved from being a specialist in selling books online.

“When they started out selling books the structure was pretty simple; you had the author, the subject and the title. That’s like the PNR. As Amazon expanded out of selling just books if everything had to fit into the same transactional model they wouldn’t have lasted very long.

“Today, airlines want to sell a much wider range of product than the fare like seat choice, early boarding and other third party content that’s complimentary to travel and legacy technology is trying to fit all these things into the same structure.

“The industry and existing tech has allowed airlines to sell ancillaries pretty well but they are expanding beyond just getting on the plane and if they want sell more third party content the technology footprint has to expand beyond the transitional transactional records.”

Reyes said, with the likes of Finnair and Lufthansa stating publicly their timelines for the shutting down of legacy technology, new age, flexible, modular systems are on track power a “golden age” of travel retailing from 2030.

“Our goal is that if you want to get into travel by starting your own airline or building the next great OTA, you don’t have to become an expert in all these traditional travel-centric technologies in order the clear the bar.

“We have taken a lot of time to think about what do we want to be, not in 2022 or in 2025, but in 2030 and beyond, and how do we start making those investments now, not trying to hold on to any particular commercial model.

“I don’t think there’s anything wrong with timescales that far out. It might seem like a long time away but it’s not that long given the complexity behind the scenes. I liken it to a journey without a destination, it’s like painting the Golden Gate Bridge.

“We feel confident we are very well placed for this next round of transformation. Our conversations with Google have shown us you are only as good as your architecture. We are pretty confident we are ready for the foreseeable future.

“The 2030s are going to be a golden age of travel retailing. The question is how fast are you prepared to move.”