Cruise is in danger of slipping back into the rampant discounting ways that saw a wave of commission cuts by operators five years ago.
Norwegian Cruise Line’s Nick Wilkinson admitted agents are polarised between the discounters and those selling at higher prices based on customer service.
“We are at the top of the [sales] pyramid and it could go either way,” warned the line’s general manager for northern Europe, the Middle East and Africa.
“We are seeing travel partners who are being very aggressive.
“And we are seeing those that understand that with good service they can get the price they need to earn a living. We are really seeing a split in the marketplace.”
Asked to comment on a seven-night Mediterranean P&O Cruises deal for the equivalent of £400 per person when free onboard spend is taken into account, Wilkinson said: “I see the emails. I do not know how they do it. We will choose very carefully how we discount. If you look at our core products you will see what’s important is added value.”
Challenged to explain how throwing in complimentary extras isn’t another form of discounting, Wilkinson said: “If you just focus on the price point, the consumer is only going to move from price point to price point.
“If you look at the added value, they stop focusing on the price point and that gives you the scope to increase the base price.”
Wilkinson said Norwegian had been doing this for 18 months and it had resulted in increased yields and revenue.
And he said Norwegian segments its product, so not all agents are competing on price for the same customer.
“We will not have partner after partner advertising the same thing,” he said. “As an industry we cannot just keep cannibalising the same clients.”
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