Travel Buddy with Switchfly

In this episode, Nowell Outlaw unravels the world of airline loyalty and dynamic travel packaging. He explores the shift from traditional vacation bundles to customizable trip planning, unpacking how bundling flights, hotels, and more can unlock surprising savings for travelers and deliver new growth opportunities for airlines. Listeners will gain firsthand expertise on the business and technical complexities behind modern travel platforms, plus insightful discussions on customer data, personalization, and why fast execution matters more than ever. Whether you're an industry leader or a traveler looking to maximize value, this conversation sheds light on what the future of trip planning could look like.

Chapters
(00:00) From Ancillary Add-ons to Total Trip Ownership
(01:00) Dynamic Versus Traditional Vacation Packaging
(03:45) Consumer Savings and Bundled Value
(07:00) Impact on Conversion and Business Outcomes
(10:00) Customer Data, Personalization, and Loyalty
(14:00) Driving Performance with Inventory and Technology
(19:00) Building Versus Buying Dynamic Packaging Solutions

Resources
  • https://www.switchfly.com/lp/dynamic-packaging-buyer-guide
  • https://www.switchfly.com/lp/airline-dynamic-packaging-infographic
  • https://www.switchfly.com/lp/airline-travel-demand-calendar

Connect with Switchfly
Website: https://www.switchfly.com/
LinkedIn: https://www.linkedin.com/company/switchfly/
X: https://twitter.com/switchfly
YouTube: https://www.youtube.com/@SwitchflyOfficial

Creators and Guests

Host
Nowell Outlaw
Chief Executive Officer of Switchfly

What is Travel Buddy with Switchfly?

See more at Switchfly.com

Welcome to Travel Buddy,
presented by Switchfly.

In this podcast, we talk about all
things travel, rewards, and loyalty.

Let's get to it.

Brandon Giella: Noel, there is a lot
of conversation around, packaging

in today's, airline loyalty markets.

and there's, an industry shift,
if you will, happening between.

What you might call, ancillary add-ons
and then moving into what you can

also call total trip ownership, and
that there is some missed revenue

opportunities between these ancillary
add-on products and what you might

call this, this total trip ownership.

Can you talk to us a
little bit about that?

What is happening in your world around
this shift from that add-on to the, the

owning the entire customer relationship?

What does that look like for y'all?

Nowell: Yeah, I think that, you
know, ancillary add-ons, people tr

traditionally think of, you know,
adding when you buy a ticket, right?

Adding your, your, where you wanna seat
sit, and so you can upgrade your seat, you

can add a number of bags, you can add, you
know, food, you can add specialty, things

like that for on flight kind of things.

I think about air packaging, it's a
completely different thing, right?

So it's taking the flight and it's.

additional components of the travel
ecosystem to that flight in a bundled way.

So, you know, if you're taking
a, a trip to, Cancun, right?

Adding your, hotel, maybe a car rental,
maybe a bunch of different activities to,

thats single transaction, which is really
outside of the way an airline thinks of.

know, ancillary revenue being added just
to that, that core passenger booking.

It's really more bundling
in everything else.

That's part of it.

Brandon Giella: This is common.

This has been happening for a while.

Like if I go to a, one of these like
online aggregators and I'm buying,

putting a trip together, you can
get flights plus hotels and so on.

Like, what, what is, what is the shift in
how you guys are thinking about it now?

Because I mean, typically people think
of it as like, it's a vacation package.

I'm going to Hawaii and I wanna get
the flight, I wanna get the hotel.

Is it just semantics that this is
different now, or the way that you're

thinking about it is different?

Nowell: I think that traditional,
you know, from the consumer point

of view, right, traditional packages
is, you know, Hey, I'm gonna.

Bundle all this stuff together for you.

I'm a travel agent and I've built this
prebuilt vacation for you, period.

The end, right?

it includes whitewater rafting, it
includes a hotel for three days.

It includes, you know,
storage for your dog.

It includes, you know, getting to and
from the airport, all that other stuff.

in the dynamic world, it's kind of
choose your own adventure, so, you

know, build out what trips you want.

Hotels, you want activities, you
want car rentals, you want and

kind of bundle it all together.

you know, as, as you want.

I think the, the concept of just a
pure trip, like there's definitely

things that fit that, like, you
know, river cruises and things, but

on, on building your own vacation.

It's more a self-guided
journey, I think these days.

Brandon Giella: Obviously
people would want that.

A, a very personalized, that's
all kind of planned out with

all the pieces that you need a.

Nowell: Mm-hmm.

Brandon Giella: were just
talking about that a minute ago.

but what's the impact?

Like, what's the need?

What's the, you know, why does
that matter now to think of

it in this kind of new way?

Nowell: I think from the consumer
point of view, it's what's,

what's the value behind it, right?

So most people don't know this.

I didn't know this right when I first
started, that if you buy a flight and you

bundle a hotel, it unlocks, a different
rate structure for the consumer, right?

And you're able to get
discounts and package prices.

That aren't necessarily available to
you if you're just buying a single

use hotel or a single stay hotel.

and separately the air, right,
or separately, the car rental.

When you bundle all that together,
the rate structure that is, available

right to people or to consumers.

Is better.

Right?

And so, you know, you can have things
where, you know, because you've bundled

a bundled a flight and a hotel and
a car and all the rest of the stuff,

you're saving thousands of dollars.

Right?

And, and that's why dynamic
packaging is really kind of

unique thing for the consumer.

Brandon Giella: Remember you bringing this
up on a previous episode, and we've even

talked to, to Ashley Martinez about this.

Said the same thing both of you
is, when you're going to book

a trip, book everything as much
as you can at one stop shop.

Like put, you know, if you're
going to, you know, however you're,

you're bundling your trips together.

Buy all the things at once because
there's codes and all kinds of things

that are happening on the backend that
you have no idea about, but it actually

does help your, your, your overall bill.

So that's, that's what I gather.

Yeah.

Hm.

Nowell: And you know, when you get
to, you know, the air carriers,

sometimes, you know, an airline
will discount the air component.

For a particular route.

So let's say, you, you know, the airline
is interested in, people to Hawaii, right?

They will actually, the route,
you know, it's, let's say it's

Seattle to, to Honolulu, they will
actually discount that route only

for the packaging component, right?

Then also discount the hotel and
things in order to drive higher,

you know, kind of yields and results
into the airline by selling those

Brandon Giella: Hmm.

Nowell: right?

And so most, most people
would never know that, right?

but it is a real thing for the consumer.

Right when you add it all up and then
you go, wait a minute, most people

go, well, I'm gonna look on the
airline website and then I'm gonna

look on, you know, a OTA site and I'm
gonna look up the hotel and then I'm

gonna try to find this independently.

I'm gonna see if I can find my best

Brandon Giella: Yeah.

Nowell: And then they go to the, the
packaging site and they go, I, I.

can't beat the

Brandon Giella: Yep.

Nowell: like Exactly right.

Because behind the scenes they're
doing things that you don't know,

are happening on the rate structures.

So

Brandon Giella: was about to say,
that's exactly how I go on book trips.

I go on one site to do one thing, I go
to another site to do another thing.

But,

Nowell: Oh,

Brandon Giella: but I have done that where

Nowell: is the

Brandon Giella: my, the rental car
has, you know, basically like I

got a free rental car for a couple
days or for a week or whatever.

By, by putting it all together, I
was able to get a, a lot of savings.

I've done that before.

Yeah.

Okay, so I wanna talk more about the,
the kind of nitty gritty, but nuts

and bolts of on the, the business
side of things of doing this.

So by having this kind of frame
away, perhaps from vacation packaging

to more of this dynamic packaging,
and it's not just about vacations,

it's not a pre-packaged deal.

That, that really can impact
conversion, you know, and, and have

other kind of, you know, business
impacts and things like that.

Like, so talk to me a little bit
about why that transaction matters so

much and the kind of the typical ways
that people have done it and where

you think we could go going forward.

Nowell: I think, and, and I use
this phrase, more readily now, that.

Especially now, given everything that's
going on in the economy, are looking for

Brandon Giella: Hmm.

Nowell: to save

Brandon Giella: Yeah.

Nowell: We see this consistently and the
concept of vacation packaging, doesn't

necessarily value to the consumer, right?

It's like, oh, well that's a package.

Maybe it's more expensive.

And this concept of bundling things
together and saving them and saving

money at, at bundling them, I think
is a real opportunity for brands

to show consumers how they can put
things together and essentially drive

more savings from, from building, one
trip, if you will, with the airline.

that make

Brandon Giella: Yeah, I've, I've,
you know, seen, some of the airline

CEOs talking recently just because
of the price of gas, because of

geopolitical tensions around the
world, if I can say it like that.

and it's just the gas, the fuel
is just going up so much so expect

that I've heard even 20% increases
on airline tickets over the summer.

so yeah, so we're always
looking for ways to save money

if that's the case, but yeah.

Nowell: And it's, you know, by changing
it to, you know, a bundle and save,

of value story to the consumer.

not necessarily about, we've
pre-built something for you, right?

It's, Hey, if you bundle this together,
you might actually save money through

with the airline, with the hotel, with
the car rental, with the activities.

And so why not give it a

Brandon Giella: Yeah.

Nowell: And and the nice thing is
that it's, since it's not pre-built,

it can be any trip that you want.

Right.

So, you know, if you're going to
Vegas, which you know now international

is reducing, especially in North
America, and consumers are, you

know, looking to go to Orlando or

Brandon Giella: Yeah.

Nowell: Vegas more than they are
going to Europe, and as the airline

fairs go up, right, like how do we,
you know, you can see this visible

Brandon Giella: Yeah.

Nowell: in where people are
looking, searching and booking,

Brandon Giella: Yeah.

Yeah, we were talking about that on
the last episode about like summer

trends that you guys are seeing in
data and also some different analyst

reports and things that people are, are
traveling a lot more around America.

So,

Nowell: Yeah.

Brandon Giella: I'm curious, so something
we were talking about, before we started

recording was the importance of, you
know, kind of making this shift and

thinking about the d the different ways
to kind of set this, this, I don't know.

Packaging discussion up.

The importance of it is, around the
data that you get from customers

that are on platform and being able
to kind of remarket to them and,

and they become, you kind of think
about this like total ownership of

that customer journey, if you will.

Like, talk to me a little bit about that,
and how thinking more about this can do a

lot more than just that transaction alone.

Nowell: Well, if you think about,
let's say you're an airline, right?

And you've got, I fly United all the time.

You know, you really have
the coach customer and the

first class customer, right?

They might fly a lot.

You know, they get free, you
know, premium economy seats.

Maybe they upgrade into first class.

Maybe they don't.

Maybe they're flying coach.

But that really doesn't tell you
a lot about that customer, right?

So, you know, one of our board
members, he flies a different airline.

He flies in a coach seat,
Because he's value driven.

doesn't have, I mean, he could
buy the entire first class

lounge if he wanted to, right?

But he doesn't, he
doesn't choose to do that.

However, where he stays on his
trips are super nice, right?

And if you don't have any insight
into who's sitting in, in the back

of your plane, maybe that would be
an important thing to have, right?

Because now let's say, you know, you
know, a person bought, you know, the,

the cheapest tickets that they could
find, because it's only a two and a

half hour journey, But they're staying
at the Ritz Carlton five star resort.

Wouldn't that be an interesting thing
to know and to really understand that

customer And so, so adding this other
dimension all of a sudden lets you

understand who is flying on your
airline and also how you can upsell

and basically improve, you know, the,
the economics longer term, I think with

them, I think that's, that's a big part

of

it

Brandon Giella: Having a, a
multidimensional view of the customer,

it takes on a whole other life of its
own through marketing and through the

customer loyalty and things like that.

Yeah.

Yeah.

Nowell: Yeah, for sure.

Because I mean, even if I have a lot
of points on your airline, which means

I fly a lot, it doesn't tell you a
lot about me as a consumer, right?

I mean, you know, the airlines know,
well, you're a, you know, you usually book

within seven days or 14 days or 21 days,
and you know, are you price oriented?

Are you buying first class?

That's all they know, right?

They don't know about the rest of your
travel journey, and I think they're, they

want to know around the rest of that.

Brandon Giella: I, I have talked about
this on the show before, but I have

two little kids, three in one, and I
feel like if I put on the itinerary

that I'm traveling with a 3-year-old
or a 1-year-old, there should be

something a little special that I get.

I get to bored earlier.

Or I get to, and I know some
airlines do let you border earlier

if you, if you tell them, but I'm
just thinking these like little.

Just these little joys that make my
travel easier because a three-year-old

on a plane is not always the
most calm thing in the world.

Nowell: crazy.

Brandon Giella: okay.

So when you're thinking about
this, when you're thinking about

air packaging, what is it that
drives performance in your mind?

And what should these airlines
and, and, leaders thinking about,

this issue, what should they
be focusing their attention on?

Like, what is the thing that
really moves the needle?

Nowell: I think it's really
around consumer value,

Brandon Giella: Okay.

Nowell: right?

So, you know, when we talk about
this bundle and save option, you

know, are you really, are you
really focused on a particular route

Brandon Giella: Hmm.

Nowell: Or a particular area
of the country or geography.

you know, we run, Japan Airlines
vacation packaging, right?

There is a definite destination
in going to Japan, right?

And, you know, as you can do some of
those route specials, you can do some of

the, you know, hotel partnership specials
to really, get consumers to switch over

to, you know, try your airline, try
this, this concept because of the value.

Right?

And so I think, you know, is really.

Being driven off of, you
know, that value equation.

But that value equation can only be
driven off of things like, you know,

do I have an adequate inventory?

Right?

So, you know, seen people that
they only single source a, you

know, hotel inventory system and.

That's good enough, maybe for
specific regions, but on a global

scale, it's not big enough, right?

So different OTAs handle different
segments of the world, better or worse,

depending on where you are, right?

So you know, the Far East is an example.

There's different suppliers and
those suppliers do a better job

at inventory rates and everything
than a North American one.

So.

Brandon Giella: I imagine the technical
infrastructure of actually pulling

that off your partner ecosystem, the
able to set pricing quickly in an

engine while somebody's searching
and trying to put something together,

I imagine that's an extremely
complex thing to figure out as well.

Nowell: Correct.

you know, this is where we
talk about AI and machine

Brandon Giella: Mm.

Nowell: you know, just data science in

Brandon Giella: Mm-hmm.

Nowell: the, you know, when you're
looking at pricing, you know.

if you think about the consumer
who's showing up, right?

And I, if you, you know, the consumer
who's like, oh man, you know what?

weekend is a three day weekend.

I just got Friday off, or
whatever, and they're gonna buy

something right away, right?

That doesn't necessarily mean you have
to be the cheapest discount, right?

If someone has that seven day, kind
of less than seven days to travel.

if a consumer is showing up and they're
planning stuff out, ninety, a hundred and

twenty, a hundred eighty days from now,
they're probably very price sensitive.

Right?

And so having tools underneath the hood,
if you will, that can adjust for specific

routes, segments, locations, durations.

So you can say if it's a consumer,
you know, and we've targeted,

Miami right, as a good destination,
they're under seven days.

Now make the margin X.

But if it's, you know, 90 days out and
it's Miami, make the margin y Right.

And, and just adjust things.

'cause you are trying to get
the conversion down, right?

Brandon Giella: What are your
thoughts on like buy now, pay later?

Points plus cash, abandoned cart recovery,
like some of these other things that

I know, different airlines have tried
in the past and things like that.

But,

Nowell: Yep.

Brandon Giella: you know,
travel protection is a big one.

that's a very obvious one that you're,
you're prompted if you're gonna buy a

ticket, you're prompted with that thing.

So, you know, just different
things like that, like do those

factor into the mix when you're
thinking about Dyna air packaging.

Nowell: They do.

I think one of the things
is, you know, one, people are

planning a vacation, right?

And so this is not a work trip.

And you know, I do work
trips all the time.

I gotta cancel it.

I move it around, I get the
credit, boom, boom, boom.

It's no big

Brandon Giella: Yeah.

Nowell: But that's different than, okay,
I'm taking, you know, my wife and my two

kids gonna go on an international trip.

Right.

Well, that trip, let's say it
costs, know, $7,000 all in.

Right.

Well.

I wanna protect that trip.

Super critical.

Brandon Giella: Yeah.

Nowell: I have to be able to add insurance

Brandon Giella: Yeah.

Nowell: if something happens, right,
if your 3-year-old gets sick, you

don't wanna risk that $7,000, right?

And so, you know, being able to
protect that is, is super important.

The, you know, the optionality to
buy now, pay later is also good

because people look at it and say,
wow, that's, you know, $7,000.

I know I'm getting my bonus later.

So, you know, can I put this money down?

And then they just come up with a
flexible payment plan to, to, you

know, to make sure they can go on
the vacation, but not, you know,

putting the whole thing, you know,
outlaid on their credit card upfront.

And I think that's important because, you
know, those longer journeys and longer

vacation trips do cost a lot of money.

and the, you know, the miles with
cash in loyalty plans, you know.

airlines themselves, they always
wanna move points and that's how

consumers come back to their brand.

And so ensuring that you have the
ability to redeem for or miles as

well as, you know, cash redemptions
is, is just part of the ecosystem.

Right.

Brandon Giella: Okay.

Last set of questions, is, so we've
talked about how in dynamic air

packaging, typically it is called
vacation packaging, but that, is, that

kind of connotes, prepackaged offers.

Whereas if you think
about it more of like.

Personalized bundle and save options,
it kind of opens up this wider remit

that allows you to, to think more
differently about the customer.

You get more dimensions on who they are.

So when leaders are thinking about
these projects, what are some of

the things that you've seen where it
stalls, in the process of, of kind of

putting these projects together and
what do you think can be done about it?

What, what should they be thinking
about ahead to get ahead of some

of these, these kind of challenges?

Nowell: you know, I think
what you see a lot of is.

People a try, try to build it themselves

and they don't realize how hard this

Hmm.

we just had a, a client that,
they tried to build it themselves.

They spent 18 months and then they
realized this is not gonna work.

Right.

And it's, Switchfly's been doing
this, or actually one of our very

first air packaging customers this
year, and it's a major airline, will

have been a customer for 20 years.

That's crazy.

Yeah.

and they're driving hundreds of
millions of dollars in revenue.

and, you know, so the interesting thing
is when you think about implementations,

I, you know, having done implementations
probably my whole life, the big home

run stellar projects, they either
slip, they fail, they miss, they're,

they're hard to deliver, right?

When you start from scratch like that.

And in today's world where you have to be
able to do things fast, you know, those

kinds of projects are really high risk.

And so, you know, that's why having a,
a vendor that can spin up things very

quickly, I think is super important.

And, and I also think that people
underestimate the amount of effort

that it takes to do this the right way.

Brandon Giella: you talked before
about the speed at which you're able

to, to move, and I think that focusing
on that is, is really important.

But man, that sounds hard.

We talked about all the
complexity it goes in that.

Nowell: Well, it's, you know, it's
like you could go, I mean, a lot of

people are like, well, I, you know, I'm
gonna go code to, you know, I'll not

use names, but OTA one, they have an
API and I'm gonna integrate with it.

You know, those guys, I'm gonna integrate
with these other guys over here.

like, great.

Okay, so you also need to handle
what's called like room unification,

because you're gonna get a data
feed of two different places.

You have to compare the rates, but
you have to make sure that you're

serving up the right content, right?

Brandon Giella: Sure.

Nowell: Well, whose
content are you going to

Brandon Giella: Hmm.

Nowell: rates are you going to use?

Whose images are you gonna to

Brandon Giella: Hmm.

Nowell: you know, it becomes
really, this really simple thing

becomes really hard, really

Brandon Giella: Hmm.

Nowell: And, You know, and then you, you
add all the other components in there.

That's why in a lot of cases, if
you go to some places, sites, what

you'll see is they don't actually
have dynamic packaging per se.

What they have is kind of
single sales booking flows.

So you can buy the air.

done.

You can buy a hotel
separately, checkout done.

You can buy the car separately.

Checkout done.

That's not dynamic packaging.

That's, you're not, as a consumer, not
afforded any discounts or value when

you have air plus a hotel, plus a car
all combined into a single transaction,

Brandon Giella: I haven't
thought about that.

I don't know if.

Consumers would know.

how would you spot the difference?

I don't know.

That's a Yeah, yeah, yeah.

Yeah.

I would've no idea.

Huh.

Interesting.

Nowell: Yep.

Brandon Giella: Well, thank you for,
for giving us some insight on this.

I know it's kind of a
growing conversation.

Any other thoughts, about, you
know, looking at different vendors

or partners or, anything else
I think about in this issue?

Nowell: Oh,

Brandon Giella: Yeah.

Nowell: as always, like, that's why

Brandon Giella: Yeah.

Nowell: a company, but, you know,
and we do this all day every day.

It's interesting to watch, you
know, airlines kind of wanting to

step these things up the right way.

So it's

Brandon Giella: Yeah.

Awesome.

Well, I know you guys have an
upcoming white paper, that will

discuss more details of this issue.

So thank you for your team
putting that together.

You can find that@switchfly.com

Noel.

Thank you as always.

last question for you.

Where are you traveling next?

Nowell: I'm going to Washington,
DC because our youngest son is

graduating from undergraduate, in a

Brandon Giella: Hey, congrats.

Awesome, awesome.

Well, excited to see that.

Okay, well, Noel, thank you again.

We'll see you on the next episode.

Nowell: All right.

Brandon Giella: Thanks.

I.