Wonder Why Celebrity is accused of cutting corners and raising rates?

[Dr. Cocktail]

The cuts in Housekeeping and Waiters has been most noticable to me. These are the people who are most in contact with passengers and can create a favorable or unfavorable impression. I don't know your particular situation! but it must have been very serious for you to give up a line you enjoyed. I really understand if you needed to deal with some of the people onshore. I got to the point with some of them that I never wanted to hear: "we appreciate your Loyalty." I was very close to jumping ship, but decided in the end that a few undertrained people wouldn't influence my onboard experiences. Toured Oceania Riveria and my DW just thought it was too small. I must say that service from Celebrity onshore has improved greatly since I became Zenith. Obviously they don't have the time or resources to give all what I get in terms of service, but they should surely try. Hope you enjoy your future cruises whatever line you cruise.

 

Thanks for your considered comments.

 

I didn't love Riviera as a ship per se, but was blown away by the high quality of the ingredients used in the various restaurants (non-pasteurized French cheeses, lobster tails at the pool-side grill, fresh berries at the buffet) and the fabulous beds, linens and bathrooms in even standard veranda cabins.

 

Of course, we paid far more then Celebrity but didn't really mind. We are fortunate enough to be able to afford it but what we really want is ... Celebrity from 1996!

[The_Big_M]

So as long as they don't cut things that you care about it's OK? I guess I have a different philosophy. Let's face it, you and I are going to be treated well regardless of what goes on. I, on the other hand, care about the total experience for everyone. In the end it will affect all of us.

 

 

Spot on.

 

For me, one of the many disheartening things has been the effective cuts in the MDR service. Staff are now serving 40% more passengers over 6 years ago, and the effect is lately terrible there.

 

Last cruise we consciously chose to eat regularly in the buffet for the first time, as the slowness and general simplicity of the MDR due to the cuts they've employed to achieve this made it not as special, and preferable to eat elsewhere.

[Jenna109]

There is definitely a drop in standards, we are just back from Eclipse and the cleaning standard was way below our last X trip.

 

In the Oceanview there was food debris gathered on the window frames, many times during Breakfast and Lunch there was insufficient cutlery.

 

On at least half the number of days on my pervious trip there was cleaning crew with paint brushes, cleaning the picture frames and kickboards. We didn't see that once this trip.

 

On 4 or 5 occasions I saw a senior housekeeping officer call someone to clean the lifts, again I have never seen that before.

 

The off-white chairs in the Martini Bar looked positively grubby.

 

The Cruise Director was awful as well, not a patch on Sue Denning or Alejandro.

 

I thoroughly enjoyed my cruise and the staff worked so hard, but if they are stretched too far something has to give. It is little surprise that Noro etc.. is on the increase.

 

I am looking at other lines for my next trip.

 

But let us not kid ourselves standards are slipping.

 

We too returned last week from the Iceland cruise and did not have the same experience. The public areas were well kept, often saw cleaners on the stairs, etc I can honestly say that I never once thought - that looks grubby.

I am not a buffet fan on any ship - mostly because if crowds and walking round to find food. However, when we did go in - off peak- we were impressed by food, cleanliness and drinks service.

The cruise director was not equal to Sue - but hey who is? I think he was doing his best following in her footsteps though hubby would agree with you.

We had fantastic service in the MDR and even on the 'free' drinks package our wine glass was never left empty.

Out of 20 cruises ten have been a mixed bag of companies but ten have been with Celebrity. We still like their product and we think they are trying to keep their clients. We thoroughly enjoyed the cheese and wine party on the lawn - I think this is new but maybe I have just not seen it before. More please.

Negative of the cruise - weather! Who to blame?

Celebrity please change merchandise in your shops and the 10$ sale. I used to love looking round the shops but nothing to tempt me there anymore.

We are back on the Eclipse in October and so looking forward to it.

[tikigal]

My grand kids would most certainly prefer Disney and I hope to be able to take them.

 

Maybe you remember me reddish hair traveling within and dad. I moved back from Seattle to FL just do I could cruise again.

I am worried after reading this forum that Xis slipping especially with the advertising of the quantum class ship luxuries. I always thought X Was

A step up. To be determined in Sept

[NLH Arizona]

We too returned last week from the Iceland cruise and did not have the same experience. The public areas were well kept, often saw cleaners on the stairs, etc I can honestly say that I never once thought - that looks grubby.

I am not a buffet fan on any ship - mostly because if crowds and walking round to find food. However, when we did go in - off peak- we were impressed by food, cleanliness and drinks service.

The cruise director was not equal to Sue - but hey who is? I think he was doing his best following in her footsteps though hubby would agree with you.

We had fantastic service in the MDR and even on the 'free' drinks package our wine glass was never left empty.

Out of 20 cruises ten have been a mixed bag of companies but ten have been with Celebrity. We still like their product and we think they are trying to keep their clients. We thoroughly enjoyed the cheese and wine party on the lawn - I think this is new but maybe I have just not seen it before. More please.

Negative of the cruise - weather! Who to blame?

Celebrity please change merchandise in your shops and the 10$ sale. I used to love looking round the shops but nothing to tempt me there anymore.

We are back on the Eclipse in October and so looking forward to it.

Jenna, it just proves that people have different likes, dislikes and experience things differently. Some have issue with Celebrity, while others don't. I've seen many more positive reviews, than I have negative ones. Personally, I could care less if I get a chocolate (flavored or not) on my pillow, because getting it or not getting it, will have no impact on my overall cruise. Things change, it is a fact of life, we either live with them or walk away if we can't.

[Orator]

Maybe you remember me reddish hair traveling within and dad. I moved back from Seattle to FL just do I could cruise again.

I am worried after reading this forum that Xis slipping especially with the advertising of the quantum class ship luxuries. I always thought X Was

A step up. To be determined in Sept

 

I do remember you and hope all is well.celebrity has changed as they appear to be shifting focus from the "average passenger" to the higher margin passenger. The more you pay, the more you get. Just a sign of the times to me. Service in all areas, not just ships has declined. That recorded phone call from a man wanting to drop Comcast is becoming far too common. Most retailers I shop appear to have cut back people and service. Still, when I compare the Celebrity experience to past experiences on othe ugliness Celebrity for me represents a good value. I still look forward to boarding a ship. I was once given what I found to be valuable advice: "Stop evaluating and just enjoy the experience". Have a wonderful cruise and I hope to see you in the future.

[Cruising89143]

I do remember you and hope all is well.celebrity has changed as they appear to be shifting focus from the "average passenger" to the higher margin passenger. The more you pay, the more you get. Just a sign of the times to me. Service in all areas, not just ships has declined. That recorded phone call from a man wanting to drop Comcast is becoming far too common. Most retailers I shop appear to have cut back people and service. Still, when I compare the Celebrity experience to past experiences on othe ugliness Celebrity for me represents a good value. I still look forward to boarding a ship. I was once given what I found to be valuable advice: "Stop evaluating and just enjoy the experience". Have a wonderful cruise and I hope to see you in the future.

 

Very good advice. :)

[jan-n-john]

RCI's recent financial quarterly report seems to have led to many assertions about trends in Celebrity's rates (up) and passenger service quality (down). This is largely erroneous. The financial statements provide no evidence at all that rates are up, and little that passenger services are being significantly downgraded.

 

Here is some actual data from the financial statements. Anyone can confirm these numbers. Note, the data refer to RCI as a whole, not just to Celebrity, because RCI does not give a breakdown for individual brands such as RCCL, Celebrity, etc. in its financial reporting.

 

These are some comparisons of Q2 2014 vs. the same period in 2013:

 

Total passenger days: 9.033 million vs. 8.486 (6.43% increase)

Total ticket revenue: $1.455 billion vs. 1.367 (6.44% increase)

On Board revenue: $.525 billion vs. .516 (1.72% increase)

 

The increase in fare revenue exactly tracks the increase in passenger days, meaning overall there was no increase in fares. On-board revenue increased more slowly than passenger days, so this was actually a reduction in passenger charges.

 

On the cost side:

 

Food: $119.2 million vs. 112.5 (5.96% increase)

Shipboard payroll: $209.2 million vs. 209.0 (flat)

 

Food costs tracked passenger days fairly closely, so there is no pattern of cost-cutting there. Shipboard payroll was flat, which would be somewhat expected since manning doesn't change if a few more passengers are aboard. At he same time, there was a 4.5% increase in fleet capacity, so this may suggest some reduction in labor per passenger. In general, however, the largest part of the reported cost reductions were in the "other operating cost" category, particularly costs that were off-loaded due to the restructuring of Pullmantur, and those of course have nothing to do with passenger service on Celebrity.

 

To summarize, it is not correct to infer from the financial results that fares are up. The numbers leave slightly open the claim that service has been materially reduced, but the relationship is fairly weak given that most of the cost reduction was related to matters other than shipboard service.

Edited July 27, 2014 by jan-n-john

[NLH Arizona]

On the cost side:

 

Food: $119.2 million vs. 112.5 (5.96% increase)

Shipboard payroll: $209.2 million vs. 209.0 (flat)

 

Are you sure these figures are correct? With all the moaning about cost cutting, especially the food and staff, you would think these would show different results.

[jan-n-john]

Are you sure these figures are correct? With all the moaning about cost cutting, especially the food and staff, you would think these would show different results.

 

Straight out of the press release and accompanying 10Q report, all available on line.

 

http://phx.corporate-ir.net/phoenix.zhtml?c=103045&p=irol-newsArticle&ID=1950924&highlight=

 

Much of the key info is in a table about half-way through the document.

Edited July 27, 2014 by jan-n-john

[The_Big_M]

Are you sure these figures are correct? With all the moaning about cost cutting, especially the food and staff, you would think these would show different results.

 

Yes, those figures are what was reported for the quarter, compared to the quarter a year ago.

[Jenna109]

Jenna, it just proves that people have different likes, dislikes and experience things differently. Some have issue with Celebrity, while others don't. I've seen many more positive reviews, than I have negative ones. Personally, I could care less if I get a chocolate (flavored or not) on my pillow, because getting it or not getting it, will have no impact on my overall cruise. Things change, it is a fact of life, we either live with them or walk away if we can't.

 

I do agree with you. Thinking only of the chocolates, plain or flavoured, each day on all cruises perhaps 20,000 are issued. Do they really make a difference? By that time of evening we certainly don't need even a plain chocolate. If anything needs to be cut to prevent price increases or staff reductions then this would be a no brainer - over a year the cost must be incredible.

An event would have to be very serious to impact on my cruise. Cut backs are a part of life now even in our own household budgets. events happen BUT I am on holiday and I WILL enjoy it. eg on our recent cruise a fellow passenger accidentally knocked over a drink and some went on my dress. He was so upset but it was an accident. Getting annoyed would only have upset me and both the man and his wife were upset enough for all of us. - some things you have to let go and not look for niggles as it is really only your holiday at risk.

[ChucktownSteve]

The financial statements provide no evidence at all that rates are up, and little that passenger services are being significantly downgraded.

 

Total passenger days: 9.033 million vs. 8.486 (6.43% increase)

Total ticket revenue: $1.455 billion vs. 1.367 (6.44% increase)

On Board revenue: $.525 billion vs. .516 (1.72% increase)

 

On the cost side:

Food: $119.2 million vs. 112.5 (5.96% increase)

Food costs tracked passenger days fairly closely, so there is no pattern of cost-cutting there.

 

To summarize, it is not correct to infer from the financial results that fares are up. The numbers leave slightly open the claim that service has been materially reduced, but the relationship is fairly weak given that most of the cost reduction was related to matters other than shipboard service.

 

On the surface, your analysis makes sense. However I wonder if you're the one who does the grocery shopping in your household? I've noticed a dramatic cost increase in all categories of groceries over the past year.

 

According to a USA Today article in April "Two months of sharp increases in food prices show grocers are starting to pass along their higher wholesale costs to consumers.Retail food prices rose 0.4% in March, the same as in February and the largest amount since September 2011." http://www.usatoday.com/story/money/business/2014/04/16/cpi-shows-food-prices-rising/7742669/

 

So I wonder; if passenger days increased and food costs increased more than food costs spent, wouldn't that indicate cost cutting in food service?

 

I have a different opinion regarding passenger days vs. ticket revenue. I suspect they're probably not in as much sync as the percentages might indicate. High competition in the Caribbean has driven down the price per passenger to maintain the occupancy rate (passenger days). According to the Dow Jones article in post #1, "Net yields rose 2.4% last quarter amid higher prices for soon-to-depart European sailings" So as some itineraries have increased price, others have had dramatic cuts.

 

I've made a couple of other observations. A couple of years ago, the Tuesday Exciting Deals had only one or two pages and were available on only one day. Now they're good for two days and are five to seven pages.

 

Prior to a couple of years ago, you never saw promotions such as 123go. How many times have they brought that back in the past two years? That's value added to try and maintain the booking price point since the food cost of liquor probably runs maybe 15% of their bar charge. Thus the giveaway is a high perceived value and low out of pocket cost.

 

But if they're giving away as much free liquor as that, a major on board revenue stream, then where are they getting their increased onboard revenue? Again from the original post, "Meanwhile, onboard revenue continued to rise, increasing 3% to mark RCL's 10th-straight quarter of increases."

 

I'd say that's good business practice to change with the market place and try to maintain your position in the industry. RCL walks a tightrope to keep both it's shareholders and passengers happy. So far they seem to be doing a pretty good job.

[cle-guy]

Spot on.

 

For me, one of the many disheartening things has been the effective cuts in the MDR service. Staff are now serving 40% more passengers over 6 years ago, and the effect is lately terrible there.

 

.

 

 

Curious to know how you know this figure. I have been trying to find such statistics and just can't.

 

I'd think the MDR staff to guest ratio is about equal, considering the proliferation of specialty restaurants that least empty seats in the MDR now each night. If 30% of guests are in alternate venues eating, that can equate to a 30% reduction in staff and still provide the same service to the guests that remain...

 

When did Specialty restaurants start to come on to X? From what I've interpreted, it seems to be a relatively new (within 5 years maybe) or so addition.

[cle-guy]

Truth, as I see it, is that they are not interested in their old base. All indications are that they are trying to create a new base. High margin passengers and a younger demographic are the foundation of the new base. Some ideas will work, some won't. I'm certain that the bean counters have calculated what they might lose and what they might gain. The potential gain in margins outweighed the risk of losing a significant number of loyal customers. I know that we do get treated quite well. I believe our treatment is primarily the result of long, positive relationships with the fine people on the ships.

 

• 
  I see this as spot on. Clues that lead to the conclusion:
  
• No new ships on porder for X
  
• New, HUGE ships coming up for RCI
  
• Enhanced Suite Program on X
  
• Enhanced Captains Club benefits and tiers on X
  
• X changes to more of a high-end Vegas style hotel experience - Indulgence, Liquid, DJ's, a more casual approach to luxury and elegance with less "ancillary" meaningless frills, and more attention to things that concern the younger set
  
• Spoken word of Fain saying X is now delivering high wealth, high margin guests
  

 

So as I see it, X is working on culling its older, or more properly spoken, less profitable/more price sensitive guests to RCI to make room for the DINK's. X will still seek to receive the older generation with large income, but not so much those looking to cruise as a hobby by seeking cheap interior cabins all the time. The profitable older set is still going to be welcomed and attracted with suite perks.

 

That the ships sail full and over capacity, means they have no problem losing passengers, there are plenty trying to get onboard to choose from.

 

I believe the alignment of Captains Club to Crown and Anchor tiers is a step to ease the transition for those X cruisers being "displaced" to find their way to RCI ships keeping some in the family knowing many like the perks that come and don't want to restart collecting points with a new line later on in life.

 

Another poster mentioned the issue of CEO's being nervous about declining passenger base and too many berths in the industry as a whole to fill. This is likely why RCI has so few ships on order, X and AZ none. And the ships RCI is bringing on on are going to the emerging Asian Markets, not adding capacity in the saturated Caribbean.

[mferranti]

[...] When did Specialty restaurants start to come on to X? From what I've interpreted, it seems to be a relatively new (within 5 years maybe) or so addition.

With the M class in 2000.

[cle-guy]

On the surface, your analysis makes sense. However I wonder if you're the one who does the grocery shopping in your household? I've noticed a dramatic cost increase in all categories of groceries over the past year.

 

I had thought this to be the case that food costs are up across the board. But our news is reporting some things are actually down these days. They made a big deal about Peanut Butter and Jelly sandwiches, PB, Jelly and bread are down.

 

Sure, many food stuffs have increased in cost, but there are certainly some areas that have not, and have declined, so the "mixed bag" may closely even out over time.

 

Also I think the lines have done things like reduced portion size (such as slimmer cuts of meat) that has let them remain steady in food cost. F&B Directors are well in tune with keeping food cost in line, by adjusting menus, ingredients, portion sizes etc.

[ChucktownSteve]

But our news is reporting some things are actually down these days. They made a big deal about Peanut Butter and Jelly sandwiches, PB, Jelly and bread are down.

 

Sure, many food stuffs have increased in cost, but there are certainly some areas that have not, and have declined, so the "mixed bag" may closely even out over time.

 

Also I think the lines have done things like reduced portion size (such as slimmer cuts of meat) that has let them remain steady in food cost. F&B Directors are well in tune with keeping food cost in line, by adjusting menus, ingredients, portion sizes etc.

 

When Celebrity begins serving PB&J then it's cost will be relevant to me since we don't have kids. :rolleyes: We're spending our kid's inheritance. :p

 

According to Dr. Mark J. Perry, a full professor of economics at the Flint campus of The University of Michigan, in an article on SeekingAlpha.com

 

"The biggest food price increases since last September have been for the various cuts of beef, which have all registered double-digit percentage price increases. Pork products like ham (3.4%) and bacon (7.5%) have also increased, as have milk (5.8%), eggs (2.7%) and cheese (2.3%).On the other hand, other meats have declined in price since last September - turkey by almost 12% and chicken breasts by 2.9%.

 

The retail prices of many other food items have fallen, many pretty considerably, since last September such as strawberries (-13.8%), coffee (-8.3%), potatoes (-8.2%), cookies (-8.2%), bologna (-7.5%), peanut butter (-7.3%), etc."

 

So what food stuffs do you suspect RCL buys more of? Isn't it more what they consume that affects the bottom line? If I'm a vegan (which I'd never be cause I love the taste of steak too much), the rise in meat prices doesn't affect my food budget. :D

[cle-guy]

 

"The biggest food price increases since last September have been for the various cuts of beef, which have all registered double-digit percentage price increases. Pork products like ham (3.4%) and bacon (7.5%) have also increased, as have milk (5.8%), eggs (2.7%) and cheese (2.3%).On the other hand, other meats have declined in price since last September - turkey by almost 12% and chicken breasts by 2.9%.

 

The retail prices of many other food items have fallen, many pretty considerably, since last September such as strawberries (-13.8%), coffee (-8.3%), potatoes (-8.2%), cookies (-8.2%), bologna (-7.5%), peanut butter (-7.3%), etc."

 

So what food stuffs do you suspect RCL buys more of? Isn't it more what they consume that affects the bottom line?

 

So my observations on X as it relates to these specific items (and specifically to the experimentation happening on Summit this summer in the buffet):

• They now carve to order cheeses and lunch meats, so no throwing away uneaten pre sliced cheeses
  
• They now offer roast beef, roast portk=, AND whole roast chicken and turkey, so some people are taking the cheaper chicken and turkey given the choice of beef, evening out the food cost there since they have options now
  
• Eggs and bacon are now "pre-portioned" (though they still have access to extra) thus saving waste for the majority of people who will grab and go, and not have pans wasting away of unused portions
  
• I imagine they use lot of potatoes, so that savings will go a long war to "even out" the "market basket" when doing food costs.
  

 

Outside the Summit buffet, people have reported

• Slimmer cuts of meat
  
• Less "choice" cuts of meat (I can't comment, I don't really pay too careful attention to my meat quality, it's rather edible or not to me)
  
• Increased price for dining in specialties, where perhaps better meats are, and the increased price goes to offset the costs elsewhere in the F&B department as well, thus maintaining the overall "food cost percentage". Yes Specialties subsidize the MDR....
  
• Canapes delivered to suites, concierge and aqua are devoid of meats and cheeses
  

 

I haven't paid careful attention myself, but are there now fewer beef offerings in MDR and more chicken, or perhaps are the chicken offering more tempting and beef offerings less tempting, thus steering people to chicken versus beef? Another tactic to control costs. I know I crave the Chicken saltimbuco myself.... and steer clear of a plain old steak as I can make that myself at home, instead looking for interesting combinations and preparations, be they beef or not.

Edited July 27, 2014 by cle-guy

[Ma Bell]

A few thoughts on the subject.

http://boomagers.com/sites/boomagers/files/Boomers_-_Marketing's_Most_Valuable_Generation.pdf

[Ma Bell]

Another.

http://www.mediapost.com/publications/article/181070/baby-boomers-control-70-of-the-us-disposable-in.html

[Ma Bell]

Then there's this one.

http://business.time.com/2012/03/16/the-declining-economic-might-of-the-18-to-34-demographic/

[Ma Bell]

delete

Edited July 27, 2014 by Ma Bell

[Rick-cruiser]

cle-guy do you work?

[cle-guy]

cle-guy do you work?

 

I do, own my own business since 2012 now with 3 retail stores with 2 partners. I do the finances and bookwork from home (like 1 or 2 hours a day except for month quarter and year end routines), another runs day to day in the stores, and the 3rd does the marketing and scouts for new locations.

 

We like to hold our "annual board meeting" on a ship :-)

 

Love my job! I've done payroll from the pier in Bermuda on 2 occasions, daily bookwork in a cafe in the Canary Islands and Nassau.

 

Used to work for Marriott for several years leaving as Assistant General Manager to work for my family's business for a few years (degree in Hotel Administration---thus my knowledge of F&B and food costs...) before getting into running retail stores worldwide for a company that travels museum exhibitions (one year, we had stores operating in 7 countries at the same time...that was crazy!), when I left to start my own retail businesses using all that knowledge I had learned along the way....

 

:D

Edited July 27, 2014 by cle-guy