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Article · November 14, 2025 · Rodolphe Lenoir
The column of Rodolphe Lenoir, co-founder of IMPACT CONSULTANTS
Too often overlooked, the distribution function is nonetheless a strategic link between marketing, RMP and sales - with a real cost to steer and a channel mix to optimise.
Just as we begin to see the major changes AI will bring to travel distribution, and when a strategic, forward-looking view of distribution is more necessary than ever, it is striking to see that the distribution function itself is often the poor relation of an organisation - and even of supplier strategy in transport, hotels or parks. Dedicated roles are rare, the policy is not always stated, and channel-level sales are not always tracked. Yet the distribution view is essential: it is a key link between supply and demand, marketing, RMP and sales.
Distribution is a shop window: direct or indirect, it is through channels that products and services are displayed. While display is generally well controlled in direct sales, that is less true indirectly. For airlines, EDIFACT-based GDS flows do not allow rich, real-time content - one of the reasons NDC was born, built on XML. Getting the right descriptions and the right merchandising demands constant attention, and there is still a lack of resources to control and showcase prices, products and services across channels.
Distribution costs easily reach 20%. That is obvious in hospitality, where Booking takes 16% on average. But the rates are not so far off in air travel, where base commission is now zero: indirectly, you have to add GDS fees - or NDC aggregators -, incentives and staff costs, quickly reaching 10%. Meanwhile, direct distribution costs are often underestimated or only partially tracked (media, IT, staff, agency rents). Direct sales are sometimes more expensive than indirect ones. Other valid reasons may justify favouring them - loyalty, control of the end customer - but not on every segment.
Distribution has to be designed as a set of complementary channels. If the policy - logically - is to favour direct sales, direct will not cover every segment. A well-segmented and actively managed third-party distribution, on the contrary, develops segments without dilution. Tour operating, which should generate incremental sales, is part of that, as are special sales.
Distribution is a well of information. In a previous, hotel life, I often told my teams that if we managed to copy 50% of Booking’s improvements, we would already have an effective website. Distributors are specialists in their field and are often inspiring for every internal function: marketing, technology, customer relations.
Mapping hotel distribution means looking at an almost infinite spider’s web of interlocked solutions. Technology choices are crucial to controlling costs and content. That too is the role of a distribution function inside a company: helping choose the best technologies to steer distribution.
Distribution is on the eve of a revolution potentially as significant as the arrival of the web in the 2000s. With AI, we will see a major shift of direct-sales traffic - from Google to AI engines -, the rise of voice interaction with assistants and a boost for inspirational travel. This will affect direct sales, indirect sales and the mix of both. Tracking those prospects and imagining distribution’s future is fully part of the job.
In short: control your distribution, rather than letting it control you.
A column by Rodolphe Lenoir - co-founder of IMPACT CONSULTANTS. Published in TourMaG on November 14, 2025.
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