Hope NCL does'nt follow suit ? yuk

[sverigecruiser]

[quote name='halos']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.



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

It makes no sense.[/quote]

I think that the revenue management look at the OBC and I think that they can get away with more if many have a high OBC.

I can't see why prices have to vary from ship to ship and sailing to sailing. If many have high OBC they can raise the prices fleetwide. Some sailings might give them a little less money and some a little more.

[sverigecruiser]

[quote name='che5904']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.[/quote]

If most people get $50 to $250 it's probably not a big thing and doesn't effect the prices much. I'm talking about a situation when many get more than $500.

It also seems that the TA business is very different in Sweden and in the US. In Sweden noone use a TA to get a better price, it's always cheaper to book everything online without using a TA. A TA is used for the service they give.

[mpk218]

Ok lets clarify this OBC a bit.
First ,Most do not have a high OBC , most have very little or non.
Second ,most of the High OBC is refundable (from TA ect. ) where as the OBC you may get from the cruise line is not. Point being the high OBC holders dont have to spend it all, they can cash out at the end of the cruise. So that takes care of the thought that they would raise prices because you must use it.
Third, higher OBC that comes from your TA , Aunt Tillie or yourself is plain old hard cash , Not a coupon in anyway. Its merely an advance payment on your bill.
So as most of us know ALL OBC is not created equal . ;)

[Starry Eyes]

[quote name='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.[/QUOTE]
Why delete Carnival? Carnival will still pay your wonderful agent a commission when you or any other client sails...and now your wonderful agent will not have anybody twist her arm to kickback part of her commission as OBC or other "cash equivalent". If your agent earns your business with excellent service, she should do well with Carnival's new program...maybe better than ever. What has a terrific agent to fear in this new structure? OTOH, if an agent gets business just by kicking back a bigger chunk of commission money to customer, well, then she may lose or redirect business.

[halos]

[quote name='sverigecruiser']
I can't see why prices have to vary from ship to ship and sailing to sailing. [B]If many have high OBC they can raise the prices fleetwide[/B]. Some sailings might give them a little less money and some a little more.[/quote]

I think NCL's drink prices are pretty high enough right now and can't foresee them making them higher just because people have OBC. We'll have to agree to disagree on this.

[Mooder]

[quote name='Starry Eyes']Why delete Carnival? Carnival will still pay your wonderful agent a commission when you or any other client sails...and now your wonderful agent will not have anybody twist her arm to kickback part of her commission as OBC or other "cash equivalent". If your agent earns your business with excellent service, she should do well with Carnival's new program...maybe better than ever. What has a terrific agent to fear in this new structure? OTOH, if an agent gets business just by kicking back a bigger chunk of commission money to customer, well, then she may lose or redirect business.[/QUOTE]

Why delete Carnival? The thinking is if you can get a better deal elsewhere, why would you bother with Carnival?

As for TAs having nothing to fear. I receive very good customer service from my TA but that doesn't change the fact that a big reason I use him is because of the OBC he can provide me. So, we're to comparing bad service with good service. We're comparing good service WITH perks and/or good service WITHOUT perks.

Many travel agencies specialize in cruise vacations, if all the cruise lines were to go this way, I believe it would seriously hurt if not destroy their business.

[Cloudyrain]

Surely if carnival aren't allowing TAs to provide OBCs, and if every cruise company stopped the practice it would obviously lower the cost equally for all cruisers as this OBC ban would be factored into the amount of commission.

Taken simply, if you pay £1000 for a cruise and the TA got £200 commission, then gave you £100 in perks, that's a guaranteed £800 to the cruise line, plus the likelihood that you spend the £100 OBC. If the TA generally offer £100 worth of perks to a customer (which will be factored into their accounts) they are always aiming at £100 profit per sale (pre business costs per sale). If they scrapped the perks, and fixed the commission, they could sell every customer the holiday for £900, and everyone (including the cruise line, TA and Customer) are not loosing out. As things stand some people pay £1000 to subsidise other people paying the same but getting large OBCs.

I understand that a capitalist society needs to function on markets, but they can still bargain on other things (upgrades for frequent cruisers for example) as long as this came out of their reduced (£100 in this example) commission.

At the end of the day, if a TA still wants to provide perks they can give their customers things such as free cruise parking, reduced flight costs, free insurance, no commission on currency.

Personally, I would much rather be inclined to book with a company that charges all customers equally, than live uncomfortably in the knowledge that my cruise costs were subsidising my neighbours champagne cocktails.

[Mooder]

[quote name='Cloudyrain']

At the end of the day, if a TA still wants to provide perks they can give their customers things such as free cruise parking, reduced flight costs, free insurance, no commission on currency.

[/QUOTE]

Nope! One of the points I have been trying to make is that the new Carnival policy prohibits this as well. Way over the top IMO.

[Cloudyrain]

[quote name='Mooder']Nope! One of the points I have been trying to make is that the new Carnival policy prohibits this as well. Way over the top IMO.[/QUOTE]

So Carnival can control everything a travel agent does, even when they are separate transactions??? I think maybe you misunderstand my point. Seriously, a currency exchange rate is not related to where a person uses that currency and forms no part of the commission that an agent gets from a cruise as its a separate part of the business. As is a flight, that can be booked separately to a cruise, and pre-cruise hotel that is separate to the cruise and whose commission is paid to the TA by the separate companies involved in those separate transactions.

[mpk218]

I think you need to read Carnivals new policy . ;)

[halos]

[quote name='Mooder']

As for TAs having nothing to fear. I receive very good customer service from my TA but that doesn't change the fact that a big reason I use him is because of the OBC he can provide me. So, we're to comparing bad service with good service. We're comparing good service WITH perks and/or good service WITHOUT perks.

Many travel agencies specialize in cruise vacations, if all the cruise lines were to go this way, I believe it would seriously hurt if not destroy their business.[/quote]

I agree.

I wonder how the 'official' cruise critic TA that handles the group cruises will fare with all this???

[graphicguy]

[quote name='Starry Eyes']Why delete Carnival? Carnival will still pay your wonderful agent a commission when you or any other client sails...and now your wonderful agent will not have anybody twist her arm to kickback part of her commission as OBC or other "cash equivalent". If your agent earns your business with excellent service, she should do well with Carnival's new program...maybe better than ever. What has a terrific agent to fear in this new structure? OTOH, if an agent gets business just by kicking back a bigger chunk of commission money to customer, well, then she may lose or redirect business.[/QUOTE]

Oh....my TA will still book my cruises....just not with Carnival. I was what this type of policy did to her business when the airlines started it. She went from 4 TAs she had down to just her. Nope, I'm done with Carnival if they institute this.

[rvsullivan]

I've read all 87 posts so far and disagree. I don't think this has much to do with us as customers, filling the ships or profits for the ships. I think this is all about making the playing field equal for all TA's. I think the small TA's have been crying for a long time now that they cannot compete with the large ones. A giant online TA can afford to give away 50-75 or even 80% of their commission in the form of OBC or other perks. The small ones are going out of business trying to keep up and of course all of the customers shopping around are playing one against the other. With Carnival's new policy there is no advantage to being a jumbo TA, all must price the same way. Better for the TA's, not so good for the customers that shop by price alone.
I don't see how this is going to change onboard pricing at all, the cruise ships are going to make the same amount of money they always have. There will be some that claim they will spend less if they don't have an OBC, far fewer than most believe. I always book direct with the cruise line and get between $300 and $500 every cruise. For those that find that important, there will still be ways to get it.

[Mooder]

[quote name='rvsullivan']I've read all 87 posts so far and disagree. I don't think this has much to do with us as customers, filling the ships or profits for the ships. I think this is all about making the playing field equal for all TA's. I think the small TA's have been crying for a long time now that they cannot compete with the large ones. A giant online TA can afford to give away 50-75 or even 80% of their commission in the form of OBC or other perks. The small ones are going out of business trying to keep up and of course all of the customers shopping around are playing one against the other. With Carnival's new policy there is no advantage to being a jumbo TA, all must price the same way. Better for the TA's, not so good for the customers that shop by price alone.
I don't see how this is going to change onboard pricing at all, the cruise ships are going to make the same amount of money they always have. There will be some that claim they will spend less if they don't have an OBC, far fewer than most believe. I always book direct with the cruise line and get between $300 and $500 every cruise. For those that find that important, there will still be ways to get it.[/QUOTE]


I take our points but if they were interested in leveling the playing field they could pay all TAs the same commission. Instead the biggest producers receive higher percentages. That's why they can afford to give more to the consumer. Carnival could change that without it impacting the consumer if that was their motivation.

[sverigecruiser]

[quote name='halos']I think NCL's drink prices are pretty high enough right now and can't foresee them making them higher just because people have OBC. We'll have to agree to disagree on this.[/quote]

Right now some people have a big OBC. If NCL should stop the high OBC from some TA's they might lower the prices a little because the demand will be lower.

Yes, we can agree to disagree.

The most important think is that we both are cruiselovers (right?) so in a strange way we really are good friends, I hope!

[sverigecruiser]

[quote name='mpk218']Ok lets clarify this OBC a bit.
First ,Most do not have a high OBC , most have very little or non.
Second ,most of the High OBC is refundable (from TA ect. ) where as the OBC you may get from the cruise line is not. Point being the high OBC holders dont have to spend it all, they can cash out at the end of the cruise. So that takes care of the thought that they would raise prices because you must use it.
Third, higher OBC that comes from your TA , Aunt Tillie or yourself is plain old hard cash , Not a coupon in anyway. Its merely an advance payment on your bill.
So as most of us know ALL OBC is not created equal . ;)[/quote]

So the TA can give a refundable OBC? Isn't that against the rule from NCL that the TA's aren't allowed to discount the cruises? They say "You have to pay full price for the cruise but I give you some money back after the cruise", right?

I know that not all OBC is created equal but I really didn't thought that TA's were allowed to giva a refundable OBC. This for me new information really give NCL a reason to follow Carnival.

[thebooler]

[quote name='halos']I think NCL's drink prices are pretty high enough right now and can't foresee them making them higher just because people have OBC. We'll have to agree to disagree on this.[/quote]
I don't think NCL's drinks prices are "pretty high enough" right now.

I think they're extortionate.

[cdnsteelman]

Well we're 92 posts deep and have successfully determined that there are a variety of opinions... thought I'd add my opionions of some other opionions:

 

1. I don't think Carnival (or any other cruise line) care AT ALL about protecting small TAs. I believe this is 100 per cent about driving inside sales so the cruise line can pocket more profit. To use another poster's numbers, IF a given cruise costs $1,000 and IF the TA commission on said crusie is 20%, the cruise line nets $800 on the sale of the package. If they drive that sale inside by eliminating the ability for TAs to incent customers by sharing that commission, the cruise line increases its profit by that same 20% less the cost of inside sales. It would be far-fetched to assume Carnival (or any other cruise line) spends as much on inside sales as it does on external TA commissions on a percentage of sale basis.

 

2. I disagree wholeheartedly with the view that this is designed to allow Carnival or any other cruise line to lower the cost of cruise packages.

 

3. I believe it is a fact that the internet has dramatically affected the TA game. Pre-internet, only travel providers and agents had access to booking systems (like Sabre in the airline idustry for example) so an experienced TA could not only provide excellent value in routing and destination planning but THEY could find the best value for consumers because consumers did not have the tools to do this for themselves. The internet has changed that and while SOME consumers still prefer the pre-internet style TA, more and more the internet saavy consumer has become his or her own TA in terms of routing, destination knowledge, price hunting, ect. As a result - many of the "old-style" knowledge-selling TAs have been forced out of the game by discounting TA (let's call them resellers).

 

4. Based on the above I believe that most (not all) TAs (resellers) understand that price comeptitiveness is table-stakes and the TA willing to keep the least commission will earn the most business. The cruise package in question is a commodity that anyone can sell and price is currently the overwhelming lever for creating market share.

 

5. I believe the TA business - much like the buggy whip business - has jumped the shark. Airlines don't pay commissions and many discount airlines don't even allow internet travel providers to book their aircraft - DRIVING ALL THE BUSINESS TO INSIDE SALES. I believe what Carnival is doing is just the next step in the continuum of driving inside sales. That said it will take longer to shake out in the cruise industry simply because of the demographic of the typical cruiser (GENERALLY older and, as such, more likely to have an attachment to the TA industry) - I'm sure someone will be offended by that truth but it is what it is.

 

6. I use a TA (reseller) for the sole reason of getting the best price. I shop for the exact cruise package I want (easily enough done on the NCL site or a million other plaves including real time cabin availability) and then put the package up for bid. I've never had an issue - have always saved ~10-15% over direct booking costs and received healthy OBC (including any offers available from NCL directly).

 

7. Finally - obvious man says: this will be a success for Carnival if they succeed in making more money as a result and a failure if they don't. Let me say that if this gets adopted industry wide, I'll still likely cruise just as much - I'll just be paying more for it and so will you.

 

8. You know what they say about opinions ;) happy crusing all.

[sverigecruiser]

Another way to see it, I don't think that anyone else has mentioned it, is that this might make the TA's to try to sell more Carnival cruises!

If a TA isn't allowed to give any OBC etc. to someone booking a Carnival cruise the TA will keep the whole commission and will earn more on each booking! Can this be what Carnival is hoping for? Will a Carnival lover be prepared to change cruise line just because thay can't get any OBC or will they stay with Carnival anyway and the TA get a higher profit?

[tenderroast]

cdnsteelman, well said!

[dutchess43]

Carnival does not care about our pocketbooks it is their bottom line that matters.

[halos]

[quote name='sverigecruiser']Right now some people have a big OBC. If NCL should stop the high OBC from some TA's they might lower the prices a little because the demand will be lower.

Yes, we can agree to disagree.

The most important think is that we both are cruiselovers (right?) so in a strange way we really are good friends, I hope![/quote]


LOL...Yes, we will definitely disagree but that doesn't make us enemies. I disagree with my husband all the time for goodness sake! It's all good :)
(But you realy [I]believe[/I] NCL or any cruise line would actually LOWER the price of drinks??? :eek:) :confused:

[quote name='cdnsteelman']Well we're 92 posts deep and have successfully determined that there are a variety of opinions... thought I'd add my opionions of some other opionions:





8. You know what they say about opinions happy crusing all.[/quote]



I can't disagree with any of that :) Well said!

[Mooder]

[quote name='cdnsteelman']

8. You know what they say about opinions ;) happy crusing all.[/QUOTE]

In this case, yours is shared.

[sverigecruiser]

[quote name='halos']LOL...Yes, we will definitely disagree but that doesn't make us enemies. I disagree with my husband all the time for goodness sake! It's all good :)
(But you realy [I]believe[/I] NCL or any cruise line would actually LOWER the price of drinks??? :eek:) :confused:

[/quote]

I don't say that large OBC's is a big factor for how the prices are set, it's just a very small factor. If a cruise line see that the number of high OBC's is decreased they might consider lower the price, or raise them a little less, the next time they shall set the prices.

They do lower the price on drinks early in the morning and late in the evening all the time just because the demand is lower then. If lots of people don't get their high OBC, the demand will be lower so why not lower the price then? (Remember, I think it's a very small factor so I don't think that the prices should be much lower but maybe I could save some dollar on every cruise if the high OBC's very gone.)

If the high OBC's are refundable my theory doesn't work but I then think that the TA's are breaking the rule about discounted cruises.

[bonvoyagie]

Here is something from an industry mag -http://www.travelweekly.com/Cruise-Travel/Carnivals-stricter-sales-policy-draws-more-praise-than-criticism/?cid=eltrdb

Note that NCL already has a policy.