Airlines can improve capacity optimisation and unlock new revenue streams by adopting modern retailing tools such as New Distribution Capability (NDC) and expanding ancillary services. This was the parting position of Chief Executive Officer of Wakanow.com, Adenike Macaulay, at the FAAN National Aviation Conference (FNAC) 2025 in Lagos.
Macaulay said Nigerian airlines must shift towards smarter distribution strategies if they wish to compete effectively in an increasingly dynamic market.
She explained that many carriers still rely on expensive legacy systems such as the Global Distribution System (GDS), which is used by travel agents worldwide to access airline fares and inventory. However, she said airlines now stand to gain more flexibility and lower distribution costs by shifting from GDS models to NDC-driven platforms.
Macaulay explained that profitability in the sector would not emerge from isolated fixes. According to her, genuine optimisation demands an ecosystem-wide approach. “I would say that airline profitability and optimisation will not come from one single intervention,” she said. “It is more an ecosystem imperative.” She stressed that revenue growth will only occur when carriers rethink their retailing models.
Drawing from her 11-year experience in commercial roles at Lufthansa German Airlines, Macaulay stated that Nigerian carriers still sit far behind global competitors in distribution technology and revenue management. She noted that the major opportunities lie in modern retailing through NDC, and in addition, a deeper focus on ancillary income. These two pillars, she said, remain largely underutilised in Nigeria.
NDC Can Reduce Costs and Improve Pricing, Says Macaulay
Macaulay said the Global Distribution System (GDS) model remains “extremely expensive” for airlines, even though a few local carriers such as Air Peace, Arik Air and recently United Nigeria Airlines still depend on it. She explained that international airlines moved from GDS to NDC, which significantly reduces distribution costs and improves fare competitiveness.
“International airlines have pivoted to NDC, leveraging technology that exists in Nigeria,” she said. “At Wakanow, we have done five direct NDC integrations with five international airlines, significantly optimising their cost of distribution.” She added that NDC allows airlines to access real-time demand, enabling continuous pricing rather than outdated fare buckets.
According to her, the GDS fare-bucket method does not recognise the customer’s purchasing power or buying intent. “That fare structure does not take into consideration the intent or the purchasing power of the customer,” she said. “Continuous pricing allows you to surface the right fare to the right customer, optimising your yield.” She urged Nigerian airlines to embrace modern retailing for better margins.
In addition, Macaulay said NDC helps airlines personalise offers and improve conversion rates. This aligns with ongoing global trends, including IATA’s retailing transformation programme.
Ancillaries Can Deliver Up to Half of Airline Profits
Macaulay emphasised that ancillary revenues remain a major, untapped opportunity for Nigerian airlines. She noted that many low-cost carriers abroad generate nearly half of their profits from ancillaries. “Most low-cost carriers like JetBlue, Spirit Airlines and EasyJet today generate up to 50% of their profits by selling ancillaries,” she said. “Their ticket price is the base, and then they optimise with ancillaries. That is something Nigerian airlines need to look into.”
She added that travel technology companies hold extensive datasets that can help airlines optimise yields using route heat maps and real-time analytics. However, these insights can only be accessed if airlines adopt technological integrations similar to NDC.
“Tech companies have a lot of data that signals route heat maps and yield optimisation,” she said. “However, this is only possible when there is technological integration between both of us.” She stated that demand across Nigeria remains strong and airlines must harness this trend with better tools. “The demand exists in Nigeria,” she said. “The Nigerian aviation space still remains very attractive.”
