A commission restructure by Carnival UK has reduced the number of customers playing agents off against each other in a bid to secure ever deeper discounts, the company claims.
Sales and customer service director Giles Hawke made the claim as the main new year Wave selling period for 2012 cruises kicks in. This is the first peak sales period where reduced 5% commission applies to Cunard Line, P&O Cruises and Princess Cruises.
While Hawke declined to disclose specific numbers, he described business in the past seven days as “a little ahead” of this time last year despite the poor wider economic situation.
“It’s early days in the wave period but we’re cautiously optimistic,” he said, adding that the company was spending more on advertising and marketing than it did in 2011.
This includes co-operative TV advertising with Thomas Cook, helping raise the profile of P&O Cruises, while a number of direct mail initiatives with other agents are about to kick in.
A standard 10% discount message is being applied during the wave period giving a sample lead-in of £599 per person for a seven night sailing with P&O Cruises.
This compares to a 20% discount being offered by rival Royal Caribbean International and savings of up to £400 off Norwegian Cruise Line.
But Hawke said: “Agents are starting to work out that the price you see is the price people pay. What we are not seeing is agents taking more off that price and this means that people are not shopping around so much.
“Agents can say: ‘The price you get from me is the best you can get in the market’.”
This compares with a situation three years ago when lines were offering discounts of 40% and agents were offering consumers up to 50% off.
“By going down this route you risk prices spiralling out of control and end up with people not believing in the discounts,” said Hawke.
“The challenge for agents is to encourage people to book now and we must make it compelling enough to get them to do so. It’s all about getting the value message in front of potential passengers and differentiating the value offered against other types of holiday.”
He was speaking as newly refurbished P&O Cruises’ ship Oriana prepared to depart on his first 97-day world cruise from Southampton as an adults-only vessel.
Capacity has been increased with the addition of 27 new cabins in place of the former children’s club, including two cabins for single passengers.
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