Hope NCL does'nt follow suit ? yuk

[bonvoyagie]

I have seen what happens when a company over distributes its products - the "street price" of the product becomes so low that none of the resellers can make any money - what happens then is the smaller resellers complain to the company about the big guys who cheat by chuming the waters - so the company comes up with penalties for chuming the water. I see that CCL is simply trying to cut down on the chumers. Other cruise lines have similar programs in place - they just have not gone public with it.

When it comes down to it we all have a choice in how we want to book a cruise vacation - we can do it all ourselves on-line - or let someone else do it for us. The only way to get a discount is to have enough people traveling to get a group rate - ie a quantity discount.

[tallyho8]

Price-fixing is always bad for the consumer regardless of whether it is a cruise or a Coca Cola. The price will never be fixed at the lowest price that the product is selling for. It will always be fixed at the highest price it is selling for so that you can't shop around and save.

Please note that Carnival is not stopping any of the travel agents from charging MORE for the cruises than they charge.

[Starry Eyes]

I like competition as well as the next guy. so I understand the sentiment expressed by those who want TA to compete with perks and service. OTOH, how would the TA's respond if the cruiseline offered direct booked customers a 10% discount (as others mention that some TAs do)? I think the TA would have a COW...they'd probably scream that the cruiseline was outcompeting them, rather than "partnering" with them...they'd likely threaten to bad mouth the offending cruise line, perhaps still mentioning how they damaged Renaissancej cruises years ago. if the competition is fair, I am all for it...If the competition is rigged, I am unimpressed.

I personally find few travels agents know more than I do about cruises, and few do significant research to guide my choices. I am happier, in general, booking direct so I can control my booking. if somebody else has a great agent who provides great service and support when things go amiss, I am very, very happy they found a terrific agent...and that agent deserves every dime of their commission, without kick backs to gain the business. I am delighted that the big behemoth of the cruise industry has decided to crack down on kickbacks...good travel agents can compete with good service...no loss in my book if the "order takers" suffer when kick backs disappear. I hope other cruiseline's will follow suit and allow all to be on equal footing, including direct bookings.

[sverigecruiser]

[quote name='Mooder']I don't know how common it is and lots of things affect sales on the ship. We buy less than a lot of people who had no OBC so I'm not sure I follow the logic. But they must have their reasons, so maybe you're right. Believe me I was happier when the perk from the TA came in the form of a reduced price, but NCL won't allow that anymore. [/quote]

If someone who normally has a final bill of for example $200 get a $500 OBC they will probably buy more things on the ship and NCL knows that.

When people get more money, ecpecially when it's an OBC they can't save, they tend to buy more things and because of that the prices goes up!

[sverigecruiser]

[quote name='Mooder']

And did I miss it or has no one addressed my issue with Carnival prohibiting perks like reduced air fare or hotel stays. Why should a cruise line be able to interfere with that business offer? It isn't their product.[/quote]

Carnivals product is their cruises. If Carnival decide that someone who wants to sell their cruises shall not discount other things it's up to them. Carnival have the right to decide who shall sell their cruises.

As a NCLlover I'm not very used to defend Carnival! I have not been on any of their ships but I have seen some and I have always been very happy that I was on a NCL ship! In Nassau Carnival Sensation was docked between Oasis of the Seas and Norwegian Epic and I was very happy that I wasn't a Carnival cruiser!

It's good that people are different and since many loves Carnival I guess that they are better than they look.

[sverigecruiser]

[quote name='che5904']I'm sorry but I'm really not following the logic of anyone how the OBC that the TAs give is raising the price of anything. There may be some logic there if the OBC is coming from NCL but if it is coming from a TA that OBC would be purchased by the TA therefore NCL would be getting their money regardless to whether the TA pre-purchased OBC or i pre-purchased OBC through the bon voyage package. Because I have OBC does not mean I get anything cheaper, it just means I pay less out of pocket at the end. And certainly the cruiseships are not going to raise prices to meet a few that have higher amounts of OBC.[/quote]

As I said to Mooder, if many have a big OBC they tend to buy more things and then the prices goes up! If many have a big OBC NCL knows that they can charge more for everything on the ship and the prices are raised.

[sverigecruiser]

[quote name='tallyho8']Price-fixing is always bad for the consumer regardless of whether it is a cruise or a Coca Cola. The price will never be fixed at the lowest price that the product is selling for. It will always be fixed at the highest price it is selling for so that you can't shop around and save.
[/quote]

Price-fixing is not always bad for every consumer. Someone who always have to pay close to the highest price should benefit from a fixed price. If everyone had to pay the highest price, the price for everything on the ship should go down!

[tenderroast]

[quote name='sverigecruiser']If someone who normally has a final bill of for example $200 get a $500 OBC they will probably buy more things on the ship and NCL knows that.

When people get more money, ecpecially when it's an OBC they can't save, they tend to buy more things and because of that the prices goes up![/QUOTE]

Or the price goes down. Or the price stays exactly the same as the cruise line doesn't price on volume. The fact of the matter is, no one here really knows what model the cruise lines use, so it's all just speculation.

The way I look at it is OBC is like a coupon offering a discount on a product that the consumer may or may not buy. It's merely a tool for a company to move product (whether that be a dinner in premium restaurant for a cruise line, or more toilet paper for Proctor & Gamble). But most people do not assume that since the Sunday paper has tons of coupons in it, that somehow, those coupons are raising the cost for those who do not use them. Just like you don't see anyone on CC complaining that the cruise line gives out coupons for premium restaurants, photo discounts, etc. They do not increase the price of these items for everyone else - just that those who are savy enough to use them, get a discount on a product they want, or in the hopes of the cruise line, buying something that they normally would not without the discount.

So if someone can explain to me clearly why OBC raises prices in general, I would like to understand. Thanks!

[che5904]

[quote name='tenderroast']Or the price goes down. Or the price stays exactly the same as the cruise line doesn't price on volume. The fact of the matter is, no one here really knows what model the cruise lines use, so it's all just speculation.

The way I look at it is OBC is like a coupon offering a discount on a product that the consumer may or may not buy. It's merely a tool for a company to move product (whether that be a dinner in premium restaurant for a cruise line, or more toilet paper for Proctor & Gamble). But most people do not assume that since the Sunday paper has tons of coupons in it, that somehow, those coupons are raising the cost for those who do not use them. Just like you don't see anyone on CC complaining that the cruise line gives out coupons for premium restaurants, photo discounts, etc. They do not increase the price of these items for everyone else - just that those who are savy enough to use them, get a discount on a product they want, or in the hopes of the cruise line, buying something that they normally would not without the discount.

So if someone can explain to me clearly why OBC raises prices in general, I would like to understand. Thanks![/quote]


Thank you, you said that so much better than I did but I was trying to understand.

[sverigecruiser]

[quote name='tenderroast']Or the price goes down. Or the price stays exactly the same as the cruise line doesn't price on volume. The fact of the matter is, no one here really knows what model the cruise lines use, so it's all just speculation.

[/quote]

I agree, it's just speculation. I think that people getting a high OBC tend to buy more on the ship and if many get a high OBC, I think that NCL will raise the prices.

If I plan to buy something for $25 and when I enter the store someone give me a voucher worth $100 if I spend it I will buy more things in the store! If lots of people get that voucher, the store will probably raise the prices on their things. Just speculation!

[sverigecruiser]

[quote name='tenderroast']But most people do not assume that since the Sunday paper has tons of coupons in it, that somehow, those coupons are raising the cost for those who do not use them. Just like you don't see anyone on CC complaining that the cruise line gives out coupons for premium restaurants, photo discounts, etc. They do not increase the price of these items for everyone else - just that those who are savy enough to use them, get a discount on a product they want, or in the hopes of the cruise line, buying something that they normally would not without the discount.

[/quote]

I agree with you that most people probably don't assume that the coupons are raising the cost for those not using them but I think that most people then are wrong!!! I do think that the coupons are raising the cost for those not using them! I agree that I'm just speculating. I'm very interested in mathematics, numbers, economics etc. but I'm not an expert in business economics and I don't say that I'm an expert.

I also think that the other things you mention raise the cost for those not using them but this thread isn't about that so I have no reason to say anything about that here.

[che5904]

[quote name='sverigecruiser']I agree with you that most people probably don't assume that the coupons are raising the cost for those not using them but I think that most people then are wrong!!! I do think that the coupons are raising the cost for those not using them! I agree that I'm just speculating. I'm very interested in mathematics, numbers, economics etc. but I'm not an expert in business economics and I don't say that I'm an expert.

I also think that the other things you mention raise the cost for those not using them but this thread isn't about that so I have no reason to say anything about that here.[/quote]

I appreciate and respect your theory, I just don't agree with it. Although now I do understand where you appear to be coming from, sort of supply and demand theory. I just don't think the majority of cruisers get that high an OBC to make any sort of impact.

[halos]

[quote name='jakesnana']. However, there is ALWAYS going to be a segment of the population that wants to work with a travel agent. This new policy levels out the playing field for many small travel agencies, making it an issue of "quality of service" rather than "how much will I get". If you're going to pay the same price, whether you book direct with the cruise line or through a travel agent, why not go with the personal service of a travel agent.[/quote]
I receive quality service AND get nice OBC from my agency.
Controling what a business makes and how they make it doesn't sound good to me. When you buy anything else, you shop around for the best price, correct?
CCL's decision is all about them and how they benefit from this. They don't give a rat's butt about the travel agencies and fairness.
I do think that some of the people who chose CCL because they felt it was cheaper, are now going to possibly see that booking with other lines, if they include OBC in their final costs, that CCL isn't going to be much cheaper in the long run and this is going to benefit NCL and other lines.

This is just another one of CCL's new, 'brilliant' plans that probably has corporate at NCL dancing and having a party.

[quote name='sverigecruiser']If it's common that americans booking from a TA get that kind of OBC it must raise the prices for everything on the ship. If lots of people get $500-700 in OBC NCL know that they will spend lots of money on the cruise and they can set the prices after that. That means that those not getting any OBC have to pay more.



I'm now really want NCL to do what Carnival does!!![/quote]

The Travel agencies are the ones taking the hit, NOT the cruise line. The base cruise fares are equal all across the board, the perks come out of the TA's commission...therefore OBC/perks have nothing to do with the cost of things on board the ship.







[quote name='2inTul']cheap crappy .......that no one wanted to buy.


That is a somewhat different situation than CCL [/quote]


Ummm....maybe not. I'm not saying this to bash CCL because I like Carnival...but if you read the boards over there you would be surprised that there are a LOT of posters who admit that they cruise the line because they feel it's cheaper. If the playing field becomes more level, those people may see that CCL really isn't that big a 'deal' and they may try other lines.
This new change is on the back of 1/2 dozen other brilliant new plans and they all add up to changes that are not good.

[Starry Eyes]

I am very happy for those who love their travel agents and get great service from those beloved agents. I am also happy that travel agents are available to serve those that want somebody to make all (or most) their arrangements.

I do not have an agent I love. Agencies give me perks like OBC, but I neither need nor want any special services. To me the TA is a middleman who stands between the cruiseline and I, sometimes delaying or inadvertently confusing my requests to the cruiseline. I regular must choose between booking direct vs putting up with a (useless at best) middleman for a lower effective cost (OBC or other perks). I think theoretically, the cruiseline could offer me that same lower effective cost, but, for fear of retaliation from the TA's, the cruiseline's are reticent to compete with the TA's. Carnival's new policy puts that cruiseline and the TA's back on equal footing (ie, the passenger can book with either an agent or directly with the cruiseline based on the passenger's perception of service). an agency that gives great service SIL still get Carnival bookings (and keep more commission to boot). an agency that offers poor or indifferent service will not longer be allowed to kick back commission to "buy" bookings. I do suspect that more people will book direct. TA's that dislike the policy can attempt to sell their clients on other lines, but several of those other lines are owned by Carnival corp, so the corporation still may do well. TA's could steer clients to NCL, RCI, X, Azamara, to hurt Carnival Corp...we shall see how that goes if they try it. carnival is the behemoth of the industry, and I am delighted they are taking a lead.

[tenderroast]

[quote name='sverigecruiser']I agree with you that most people probably don't assume that the coupons are raising the cost for those not using them but I think that most people then are wrong!!! I do think that the coupons are raising the cost for those not using them! I agree that I'm just speculating. I'm very interested in mathematics, numbers, economics etc. but I'm not an expert in business economics and I don't say that I'm an expert.

I also think that the other things you mention raise the cost for those not using them but this thread isn't about that so I have no reason to say anything about that here.[/QUOTE]

Price/value is just perspective. That's why you see some people paying for suites and others inside cabins. It's called perceived value, and that's how retailers (and cruise lines) can price the same product in so many different ways. We're all familiar with the concept of supply and demand which is directly affected by perceived value (that is, the higher the perceived value, the higher the price can be justified). Supply is typically driven by demand, but in our case, supply really isn't a factor, as most of the items on board a ship is a service or hard item, which has already been paid for by the cruise line, and they will lose its value if not sold (like once a loaf of bread has expired, a store has to throw it out - they take the loss). Hence the coupons and sales being offered shortly before a product is to expire.

Now, a savvy business may try to avoid the "expired bread" scenario all together in a number of ways: 1) have a sale (lower the price, increase demand); 2) offer a coupon before expiration (increase demand); or 3) market the loaf of bread in a way to drive up demand. #3 adds additional cost to the bread and probably isn't a good choice. #1 is a "just in time approach" which may or may not work. But #2 can work in two ways. One, it offers the consumer an incentive (lower price and increases demand) and two, if enough consumers do this (buy the bread), he'll have less bread to sell (decreased supply), which may further increase demand, as new customers may see that this particular brand of bread is in demand, so it must be good! Win/win for both the store and the consumer! But I would say, in any of the three scenarios, the store owner would be unwise to raise the cost of the bread, unless demand was so high that the market would support the higher cost (which is unlikely). That doesn't mean that all food stores in the area could agree to raise the price of the bread, which would force customers to buy at the increased cost. But as soon as one store decides they're tired of throwing away expired loaves of bread (after all, not every food store in town is going to sell all of their bread) and decides to have a sale or give out coupons! That of course, could lead to a break up of the "bread consortium" and it's back to good old "let the market" drive the price. So I can see how you could argue that in a the ideal scenario where coupons (or OBC in our case) drives up the bread sales (demand) which could support increasing the bread cost. But like any retailer will tell you, it's a fine line determining which brands in a store which may have thousands, can support an increase (a very small percentage). But it's not unlikely. It is, however, unlikely that a whole store's inventory could support a price increase, without a drop in demand. Hence why stores are always having sales (and if you pay close attention, the cycles are quite predicable) because again, retailers have a price that they must make for every item, and they play the "perceived value" game with consumers each week. Just as you have some folks who pay for suites on NCL, you have others who will never buy a loaf of bread unless it's on sale or they have a coupon. Neither one is a good or bad consumer, because at the end of the day, the business is just as happy to sell a suite, as it is to sell a loaf of bread at $.25 off.

So yes, I believe that if all the cruise lines take this approach, it will ultimately raise the costs for everyone as there will be no discounts to be had. And by virtue of the millions of coupons issued each year and the numerous discount chains in this country, it's safe to assume that we Americans like our bargains, discounts, and good deals! And who knows, maybe we'll see some cruise lines go out of business, and other discount or "value" lines start (just like in the airline industry). But I think that NCL is smarter than this and will look to differentiate themselves, even if their costs are higher - consumers tend to like choice, and when you take that from them, they tend to not stick around. NCL, whose image is choice (Freestyle Cruising), I hope will not go to this fixed price model. They would have to change their tag line to "Fixed Style Cruising" :)

[mpk218]

In a nut shell tenderroast ;)

Well put.

[sverigecruiser]

[quote name='che5904']I appreciate and respect your theory, I just don't agree with it. Although now I do understand where you appear to be coming from, sort of supply and demand theory. I just don't think the majority of cruisers get that high an OBC to make any sort of impact.[/quote]

If not lots of people get very high OBC my theory is much weaker and I might agree with you. If most people don't get a high OBC from their TA, it's not a big problem if NCL says that the TA's aren't allowed to give any OBC!

[sverigecruiser]

[quote name='halos']

The Travel agencies are the ones taking the hit, NOT the cruise line. The base cruise fares are equal all across the board, the perks come out of the TA's commission...therefore OBC/perks have nothing to do with the cost of things on board the ship.
[/quote]

I'm not talking about who is "taking the hit". My theory is that if lots of people have a large OBC, the cruiseline sees the chance to sell more for a higher price.

[sverigecruiser]

[quote name='tenderroast']Price/value is just perspective. That's why you see some people paying for suites and others inside cabins. It's called perceived value, and that's how retailers (and cruise lines) can price the same product in so many different ways. We're all familiar with the concept of supply and demand which is directly affected by perceived value (that is, the higher the perceived value, the higher the price can be justified). Supply is typically driven by demand, but in our case, supply really isn't a factor, as most of the items on board a ship is a service or hard item, which has already been paid for by the cruise line, and they will lose its value if not sold (like once a loaf of bread has expired, a store has to throw it out - they take the loss). Hence the coupons and sales being offered shortly before a product is to expire. [/quote]

I don't agree with you that a suite and a inside is the same product but I agree that it's a question about supply and demand. I do think, I don't say
that I'm right, that the demand is increased if many cruisers have a high OBC and because of that I think that the price of things on board will be higher.

The cruiseline have paid for everything already but that doesn't mean that they will like to earn as much money as possible. If noone has an OBC it will be harder to sell the things and the price will be lower and if many have a high OBC the things will be easier to sell and the price will be higher! JUST MY THEORY, noone has to agree!

[sverigecruiser]

[quote name='tenderroast'] So yes, I believe that if all the cruise lines take this approach, it will ultimately raise the costs for everyone as there will be no discounts to be had. [/quote]

It will not raise my cost because I don't get any discount anyway!

[snoozycruisee]

[quote name='Starry Eyes']I am very happy for those who love their travel agents and get great service from those beloved agents. I am also happy that travel agents are available to serve those that want somebody to make all (or most) their arrangements.

I do not have an agent I love. Agencies give me perks like OBC, but I neither need nor want any special services. To me the TA is a middleman who stands between the cruiseline and I, sometimes delaying or inadvertently confusing my requests to the cruiseline. I regular must choose between booking direct vs putting up with a (useless at best) middleman for a lower effective cost (OBC or other perks). I think theoretically, the cruiseline could offer me that same lower effective cost, but, for fear of retaliation from the TA's, the cruiseline's are reticent to compete with the TA's. Carnival's new policy puts that cruiseline and the TA's back on equal footing (ie, the passenger can book with either an agent or directly with the cruiseline based on the passenger's perception of service). an agency that gives great service SIL still get Carnival bookings (and keep more commission to boot). [B][COLOR=red]an agency that offers poor or indifferent service will not longer be allowed to kick back commission to[/COLOR][/B] [B][COLOR=red]"buy" bookings.[/COLOR][/B] I do suspect that more people will book direct. TA's that dislike the policy can attempt to sell their clients on other lines, but several of those other lines are owned by Carnival corp, so the corporation still may do well. TA's could steer clients to NCL, RCI, X, Azamara, to hurt Carnival Corp...we shall see how that goes if they try it. carnival is the behemoth of the industry, and I am delighted they are taking a lead.[/quote]

[COLOR=#0033cc][COLOR=red]If I utilized an agency that offered poor or indifferent service, I would no longer book with them, regardless of the OBC, etc. that was offered….I utilize / book with a large, nationwide agency that offers both great service AND nice perks to boot. I look at OBC as “the Icing on the Cake” not the Cake itself. [/COLOR][/COLOR]
[COLOR=#0033cc] [/COLOR]

[che5904]

[quote name='sverigecruiser']If not lots of people get very high OBC my theory is much weaker and I might agree with you. If most people don't get a high OBC from their TA, it's not a big problem if NCL says that the TA's aren't allowed to give any OBC![/quote]

I believe it will still hurt TAs because it takes away their edge, therefore putting their business in jeopardy, and I'd really hate to see TAs go out of business for those (as I said above) that require them. So IMO that makes it a big problem if NCL decided to do this too. Not everyone is computer or research savvy. I personally book direct as stated above.

Most that come on CC stating the savings they got by booking with a TA are happy that they were able to get a $50 to $250 OBC from them. In todays world everyone is out for any kind of savings they can get. So the OBC doesn't have to be large to draw a customer.

[halos]

[quote name='sverigecruiser']I'm not talking about who is "taking the hit". My theory is that if lots of people have a large OBC, the cruiseline sees the chance to sell more for a higher price.[/quote]
I doubt the revenue management look at how much OBC passengers have when pricing things on the cruise. Basically, I would think (we'll use beverages for instance)....that they will charge as much as they can get away with no matter how much OBC is floating around people's S&S cards.

[quote name='sverigecruiser']The cruiseline have paid for everything already but that doesn't mean that they will like to earn as much money as possible. If noone has an OBC it will be harder to sell the things and the price will be lower and if many have a high OBC the things will be easier to sell and the price will be higher! JUST MY THEORY, noone has to agree![/quote]

if your theory were accurate, prices of things would then have to vary from ship to ship/sailing to sailing.

It makes no sense.

[tenderroast]

[quote name='sverigecruiser']I don't agree with you that a suite and a inside is the same product but I agree that it's a question about supply and demand. I do think, I don't say
that I'm right, that the demand is increased if many cruisers have a high OBC and because of that I think that the price of things on board will be higher.

The cruiseline have paid for everything already but that doesn't mean that they will like to earn as much money as possible. If noone has an OBC it will be harder to sell the things and the price will be lower and if many have a high OBC the things will be easier to sell and the price will be higher! JUST MY THEORY, noone has to agree![/QUOTE]

Agreed that my analogy between the suite and inside cabin is not perfect, but my point was that in general, at the end of the day, we're all on the same cruise enjoying pretty much the same stuff, except one person paid upwards of $4K for the experience, while the other person may have paid under $1K. Of course the experience (or perceived value) is going to vary significantly between the two people, but again, they're both on the same boat, going to the same place, and pretty much have access to the same shows, buffets, etc. Or same product, different price. Sort of like why is there a market for a $85K Mercedes, when a $15K Honda will also get you from point A to point B just the the same? Some folks just see the value of luxury worth it. But it would be crazy if all car companies made pretty much the same cars and charged the same price, now, wouldn't it? (unless we're talking Mercedes luxury at Honda prices :) )

Apologies to the OP for my long posts which aren't 100% on topic :)

[graphicguy]

Carnival has forever lost me as a customer. I wholeheartedly support Travel Agents. My TA has been with me for 14 years. Even though she makes no money on my business travel, she still does it for me because I also let her do my personal travel (including cruises). I called her yesterday to tell her to delete Carnival from any cruises she may suggest for me.