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Duffel: helping new entrants to bag a flight and crack CX
It may be a start up tech company trying to disrupt airline technology incumbents but the end user experience is where it all started. Pamela Whitby reports
Steven Domin, the CEO and founder of Duffel, stumbled into creating what the press release proclaims is “the biggest shakeup of the travel sector since the launch of budget air travel” sort of by accident. He was trying build something “fairly unambitious” – a weekend getaway website that involved some element of machine learning to determine preferences of past trips, and included flight and hotels.
“I thought this would be the hardest part,” he says. But he quickly discovered that the worst bit was getting access to the reservation systems for searching flights and hotels.
Steve Domin, with co-founder and Chief Product Officer Thomas Bates
As a software engineer who had worked in payments and witnessed the game changing moves of companies like Stripe and Ayden, not to mention Twilio in telecoms, Domin could not resist the challenge to do the same for flights. Two years ago this week Duffel, named after the travel bag, was born and the company has just secured $30-million in a third round that brings its total investment to US$56 million.
But are the company’s bold ambitions to rival the impact budget travel has had on the sector realistic? Domin laughs: “If I’m honest, I agree the statement is a bit bold – PRs are good at finding catchy statements. Nonetheless, what we are trying to do is still a massive change.”
In essence, Duffel is working to allow its target audience - new entrants to the travel industry in the form of online travel agents, tour operators and corporate booking platforms - to access real-time flight offers and live seat availability, make bookings, and purchase ancillary services. “Our product is an API and so we focusing on these guys because want to work with companies that have the resources in house to build technical integration,” he says. A web application for travel agents is also on the cards and could be available as early as the end of this quarter.
With any new technology there is always going to be some short-term pain
Duffel’s innovation has been possible thanks to IATA’s new distribution capability (NDC), a standard that has allowed airlines to become less reliant on the global distribution systems (GDSs). But not everybody is happy with the evolving landscape. Jerker Elming, Business Area Director of BIG Travel, a Swedish OTA, recently told EyeforTravel that he sees “a Wild West with a power game playing out between airlines, distributors, and technology firms that does not necessarily benefit the consumer”.
Domin acknowledges that servicing issues have been a challenge. “With any new technology there is always going to be some short-term pain and the travel agencies, especially the TMCs, have been frustrated,” he says. In addition, it has also taken some time for the NDC standard to evolve and accommodate various scenarios but there have been improvements this past year and “the technology is catching up”.
New business models
The bigger question, however, is how the commercial model evolves into the future where there will be winners and losers. While the status quo may work for GDSs and some travel agents, the bottom line is that the airlines are fed up with paying high distribution costs. Although Duffel is taking on the large incumbents Gomin acknowledges that “there are a lot of things that can go wrong.” Not least getting more airlines involved! Although Duffel is already working with 18 airlines, including American Airlines, British Airways, Lufthansa Group, Aegean Airlines, Vueling and Iberia, the GDSs are connected to hundreds. “There is a lot that needs to be built, and that is where we are focusing all of our efforts,” he says, adding “we have a lot of catching up to do both in terms of content coverage but also features.”
we have a lot of catching up to do both in terms of content coverage but also features
Ask any consumer-facing travel company what their priority is and most understand that to win in this game, delivering a great customer experience is crucial. As consumer behaviour continues to shift and the landscape evolves, integration companies like Duffel will continue to disrupt the status quo by facilitating new business models like those of the so-called 'super apps' - like GoCheck in Indonesia, Didi in China, OLA in India - that offer a single portal to a wide range of virtual products and services.
Domin, for one, longs for a world where you no longer have to go to several different websites to plan travel. He wants to change the dynamic so that if you are booking say a festival, you don’t have to have to go to several websites to book transport and accommodation. “As a consumer I don’t think anybody really likes this. You have three parties you need to talk to if something goes wrong and it is just not very well integrated. We want to reverse this model,” he says.
Bold indeed. But disruption is coming to travel and it might be from where we least expect it.
Next week we are looking at the complex hotel distribution landscape, where start-ups are also innovating, and the impact this can have on revenue optimisation. The EyeforTravel Revenue Optimisation & Growth Summit (Nov 27-26) is just around the corner so book your place before it’s too late