TAs allowed to discount?

[RocketMan275]

10 hours ago, nycruiser80 said:

I used to be a TA and way back when, yes, they allowed it. We used to be able to apply our commission to the fare and undercut the cruise line as we saw fit. I left the business back in 2012 and at that time I wasn't allowed to do this with any major line.

 

Instead, what many of you are getting are group rates that your TA has (which at times come out lower than the cruise line directly) or some high performing agencies get preferred pricing on certain, low performing sailings. These preferred prices are dictated by the cruise line and are offered to certain high-performing agencies and are lower than the going rate with Princess directly. My former colleague and now my travel agent offers me these promos when his office offers them. Otherwise they do not allow a travel agent to reduce a rate as they please. Instead of reducing rates to entice bookings, travel agents can offer OBC, free grats or comp dinners at the specialty restaurant.

Perhaps group rates explain some of the discounting but my TA, who is a major TA used by many here on CC, gives an 8% to 10% discount on any advertised cruise line price.  

[MCC retired]

12 hours ago, nycruiser80 said:

I used to be a TA and way back when, yes, they allowed it. We used to be able to apply our commission to the fare and undercut the cruise line as we saw fit. I left the business back in 2012 and at that time I wasn't allowed to do this with any major line.

 

Instead, what many of you are getting are group rates that your TA has (which at times come out lower than the cruise line directly) or some high performing agencies get preferred pricing on certain, low performing sailings. These preferred prices are dictated by the cruise line and are offered to certain high-performing agencies and are lower than the going rate with Princess directly. My former colleague and now my travel agent offers me these promos when his office offers them. Otherwise they do not allow a travel agent to reduce a rate as they please. Instead of reducing rates to entice bookings, travel agents can offer OBC, free grats or comp dinners at the specialty restaurant.

 

 

Sounds like it was your Travel Agency, that you worked for, that did not permit discounting  , not the cruise lines 

like Princess , Cunard and HAL that still permit it to this day.

[Hlitner]

What you call "discounting" is not simple in the cruise business.  Many cruise lines enforce a strict pricing policy which required all the cruise/travel agents to adhere to cruise line's price structure (the same as they show on their own web sites).  However, agencies are often allowed to offer other benefits (authorized by the cruise lines) such as generous On Board Credits (OBCs) perks (such as pre-paid gratuities), etc.  But Princess is one of the few that actually allows cruise agents to promote lower pricing.   In fact, my favorite agency will often have multiple pricing/perk deals for any Princess cruise.  Some other lines do not permit this practice.    Also keep in mind that many cruise agencies will essentially discount cruises by "kicking back" a portion of their commissions.   They do this because they deal in high volume, are members of high volume consortiums, or have negotiated deals with the cruise line where the agency and line might share the cost of some OBCs or perks.

 

All this means that it often behooves the customer/cruiser to shop around for the best overall deal.  As a general rule we can always save at least 7% (when compared to the best offerings by booking direct with a line) and sometimes have saved up to 15% by simply booking with the right cruise agency.

 

Hank

 

 

[Ken the cruiser]

8 hours ago, Steelers36 said:

Or, better yet, find a TA that offers a cash discount off the fare.  I see you get that now from CCL brands and DCL, but not RCCL brands (perhaps no one does actual discounts for those - IDK).

From my understanding RCCL brands only allow TAs with whom they have contracts with to offer OBC as a discount rather than a cruise fare credit or rebate, but I could be wrong.

[Hlitner]

33 minutes ago, Ken the cruiser said:

From my understanding RCCL brands only allow TAs with whom they have contracts with to offer OBC as a discount rather than a cruise fare credit or rebate, but I could be wrong.

It is a bit more complicated.  In the travel industry there are some major "consortiums" (such as "Signature Travel Network") which negotiate deals with cruise and other travel industry entities and then pass along the deals to their many member agencies.   But even the member agencies will often have some of their own discounting (on top of what they get from the consortium) which still makes shopping around lucrative.   We have recently been pricing out a couple of long (and expensive) Oceania cruises.  This line does try to maintain pricing discipline so prices are generally the same from agency to agency.  But the differences in OBCs (and sometimes pre-paid gratutities) amounts to significant savings by choosing one agency over another.  We are talking hundreds to over a thousand dollars on a single booking.  By the way, the most we have ever saved by shopping around was nearly $3500 on a long HAL cruise.  When a fellow cruiser/friend told me he was "loyal" to one particular cruise agent I asked if that loyalty was worth thousands of dollars per booking.  He had no idea how much that loyalty was costing him and has since learned to shop around.

 

Another interesting phenomenon are the large number of cruisers who think it is best to book directly with a cruise line.  This has oft been a topic here on the various cruise line boards of CC.  Having booked over 100 cruises (including 60 day+ voyages) for myself we no longer give much consideration to booking direct.  However, we always do a comparison of the cruise line's own site to the best deal we can get from one of our favored cruise agencies.  In over 100 cruises the cruise line's site has never been close to competitive.   When folks here on CC insist that they cannot find an agency that gives them a better deal then booking direct our quick answer is that they have not looked at the right agencies :). 

 

Hank 

[DrivesLikeMario]

5 hours ago, RocketMan275 said:

Funny thing is that I have received discounts on RCCI and Celebrity.  My TA assures me that she will discount any cruise line and that there is nothing the cruise lines can do about it.  Price fixing is still against the law.

 

I'm sure many TA will tell you that they would love to give you a discount but the cruise lines won't let me give discounts.  

What you're not understanding is that TAs cannot ADVERTISE discounted rates.  They cannot discount cruise fares for some cruise lines.  It's a policy that is set by the cruise lines and has nothing to do with TAs trying to get out of giving a discount.  RCI, Celebrity, Azamara and others will not let an agent change their pricing.  How TAs get around that is by offering OBC, free gratuities or some other amenity or by establishing Groups and giving up their TC (Tour Conductor credit) and splitting the free cruise fare among the other cabins.  It's the way it has been for the past 3-4 years.

Edited May 26, 2020 by DrivesLikeMario
typo

[RocketMan275]

33 minutes ago, DrivesLikeMario said:

What you're not understanding is that TAs cannot ADVERTISE discounted rates.  They cannot discount cruise fares for some cruise lines.  It's a policy that is set by the cruise lines and has nothing to do with TAs trying to get out of giving a discount.  RCI, Celebrity, Azamara and others will not let an agent change their pricing.  How TAs get around that is by offering OBC, free gratuities or some other amenity or by establishing Groups and giving up their TC (Tour Conductor credit) and splitting the free cruise fare among the other cabins.  It's the way it has been for the past 3-4 years.

Why don't you explain how you define a discount.  

[caribill]

5 hours ago, Hlitner said:

What you call "discounting" is not simple in the cruise business.  Many cruise lines enforce a strict pricing policy which required all the cruise/travel agents to adhere to cruise line's price structure (the same as they show on their own web sites).  However, agencies are often allowed to offer other benefits (authorized by the cruise lines) such as generous On Board Credits (OBCs) perks (such as pre-paid gratuities), etc. 

 

Hank

 

 

As I remember it from several years ago (and it may not be the same today), Carnival Cruise Lines (the cruise line, not CCL Corp) said no discounting and limited TAs to OBC or other benefits to a value of no more than $25.

[Hlitner]

3 minutes ago, caribill said:

 

As I remember it from several years ago (and it may not be the same today), Carnival Cruise Lines (the cruise line, not CCL Corp) said no discounting and limited TAs to OBC or other benefits to a value of no more than $25.

That is a lot malarkey :).   I will admit that my Carnival days are long behind me (no way would we go on a Carnival cruise anymore) but I just looked at a few upcoming Carnival cruises on one of my favorite cruise agency sites.   No problem getting over $100 on a low cost balcony cabin and several hundred dollars of OBC for booking a suite.  Even some of the Big Box stores (I do not use these) will give you far more than $25.  In the past when we have cruised on Carnival we always got at least 7% in OBCs,

 

Hank

[RocketMan275]

1 hour ago, Hlitner said:

That is a lot malarkey :).   I will admit that my Carnival days are long behind me (no way would we go on a Carnival cruise anymore) but I just looked at a few upcoming Carnival cruises on one of my favorite cruise agency sites.   No problem getting over $100 on a low cost balcony cabin and several hundred dollars of OBC for booking a suite.  Even some of the Big Box stores (I do not use these) will give you far more than $25.  In the past when we have cruised on Carnival we always got at least 7% in OBCs,

 

Hank

Amazingly, there are many who simply do not want to admit that discounts are available on almost all cruise lines despite the personal testimony of other posters that such discounts are available. 

 

Price fixing is illegal under federal law.

[weedpindle]

1 hour ago, RocketMan275 said:

Amazingly, there are many who simply do not want to admit that discounts are available on almost all cruise lines despite the personal testimony of other posters that such discounts are available. 

 

Price fixing is illegal under federal law.

Do you understand what 'price fixing' is? Individual cruise limes price their cruise for a set amount as to category . This price changes like airfares, up, down, what ever the market dictates. 'Price fixing' is agreement between parties ( several cruise lines) setting alike prices.  No person or agency gets a 'discounted' rate from princess, rather prices are set on factors such as amount of cabin booked per cruise per agency or consortium. Any TA is not getting a 'deal' for you, rather they may have a group rate where they get a good price. The 'deal' you usually get is the portion of the commission the TA gives up in order to give it to you.

[weedpindle]

11 hours ago, RocketMan275 said:

Perhaps group rates explain some of the discounting but my TA, who is a major TA used by many here on CC, gives an 8% to 10% discount on any advertised cruise line price.  

They are giving up part or most of their commission.

[nycruiser80]

11 hours ago, MCC retired said:

Sounds like it was your Travel Agency, that you worked for, that did not permit discounting  , not the cruise lines 

like Princess , Cunard and HAL that still permit it to this day.

Possibly and I just didn't realize at the time. I asked my travel agent/friend and he said that he can't discount any major line including Princess but his place has Princess group space blocked and a lot of it (during normal times) so I get that lower rate and OBCs. Wonder if Princess will stop agencies from offering lower rates once we are in this new environment. 

[caribill]

4 hours ago, nycruiser80 said:

Wonder if Princess will stop agencies from offering lower rates once we are in this new environment. 

 

There is no benefit to Princess by not allowing TAs to discount their cruises in addition to any group fare reduction.

 

It does not cost Princess any $$$ when a TA offers a discount out of their commission.

 

The reason other cruise lines forbid discounting is to keep TAs who offer no discount at all from being unhappy about their competition that can offer lower prices.

 

By the way, TAs get "amenity points" from Princess when they book cruises. The number of points basically depends on the length and cost of the cruise. These amenity points can be used to offer perks to the passenger such as $25 OBC or a bottle of wine or casino credit or a specialty restaurant meal, etc. So often what looks like a gift to the passenger from the TA is really from the cruise line via these points.

 

However, the TA does not have to use these points for the passengers' benefit. The points can be used to increase the TA's commission and I am sure a number of TAs do just that.

[RocketMan275]

14 hours ago, weedpindle said:

Do you understand what 'price fixing' is? Individual cruise limes price their cruise for a set amount as to category . This price changes like airfares, up, down, what ever the market dictates. 'Price fixing' is agreement between parties ( several cruise lines) setting alike prices.  No person or agency gets a 'discounted' rate from princess, rather prices are set on factors such as amount of cabin booked per cruise per agency or consortium. Any TA is not getting a 'deal' for you, rather they may have a group rate where they get a good price. The 'deal' you usually get is the portion of the commission the TA gives up in order to give it to you.

Are you saying that a discount can only occur when the cruise line charges the TA a lesser amount and the TA passes that amount onto the customer?

[RocketMan275]

14 hours ago, weedpindle said:

Do you understand what 'price fixing' is? Individual cruise limes price their cruise for a set amount as to category . This price changes like airfares, up, down, what ever the market dictates. 'Price fixing' is agreement between parties ( several cruise lines) setting alike prices.  No person or agency gets a 'discounted' rate from princess, rather prices are set on factors such as amount of cabin booked per cruise per agency or consortium. Any TA is not getting a 'deal' for you, rather they may have a group rate where they get a good price. The 'deal' you usually get is the portion of the commission the TA gives up in order to give it to you.

That's an incomplete definition of price fixing.  You are only referring to what's called 'horizontal' price fixing.  "Vertical" price fixing is where the manufacturer of a popular product uses its clout to force retailers to follow "Manufacturer's Suggested Retail Pricing" and not offer sales or discounts.  This type of price fixing has been illegal since 1911.  The Supreme Court decision in Miles v. Park said that this was a violation of the Sherman Antitrust Act.  

 

A second point, do you really believe that a group rate can account for the 7% to 10% discounts others have received?

 

[RocketMan275]

19 hours ago, DrivesLikeMario said:

What you're not understanding is that TAs cannot ADVERTISE discounted rates.  They cannot discount cruise fares for some cruise lines.  It's a policy that is set by the cruise lines and has nothing to do with TAs trying to get out of giving a discount.  RCI, Celebrity, Azamara and others will not let an agent change their pricing.  How TAs get around that is by offering OBC, free gratuities or some other amenity or by establishing Groups and giving up their TC (Tour Conductor credit) and splitting the free cruise fare among the other cabins.  It's the way it has been for the past 3-4 years.

Please read my response in post #41 to weedpindle.

[Ken the cruiser]

For purposes of this discussion, would somebody please explain to me what type of discounted rate we are getting from our TA based on the amount of the commissionable Princess cruise fare? The below was copied from one of our TA's invoices:

 

Amount Details   Total               Grand Total
Cruise Rate         2,039.00 x 2     4,078.00     (Advertised Princess cruise fare)
Air Fare                527.92 x 2        1,055.84
Transfer              39.00 x 2                78.00
Insurance           163.12 x 2            326.24
Tax/Fees            260.13 x 2            520.26
(TA) Discount   (170.00) x 2         (340.00)    (TA Discount to manage our booking)
---------                 --------------------    ----------------------
Total                    2,859.17              5,718.34

 

** BTW our TA adverises a 10% discount on their website for most of their listed cruises, sometimes in the form of a cruise fare credit and sometimes in OBC depending on the cruise line. The reason the above TA Discount doesn't appear to be 10% of the Princess Cruise Rate is because the discount is based on the commissionable portion of the advertised rate rather than the entire amount.

Edited May 27, 2020 by Ken the cruiser

[RocketMan275]

6 hours ago, Ken the cruiser said:

For purposes of this discussion, would somebody please explain to me what type of discounted rate we are getting from our TA based on the amount of the commissionable Princess cruise fare? The below was copied from one of our TA's invoices:

 

Amount Details   Total               Grand Total
Cruise Rate         2,039.00 x 2     4,078.00     (Advertised Princess cruise fare)
Air Fare                527.92 x 2        1,055.84
Transfer              39.00 x 2                78.00
Insurance           163.12 x 2            326.24
Tax/Fees            260.13 x 2            520.26
(TA) Discount   (170.00) x 2         (340.00)    (TA Discount to manage our booking)
---------                 --------------------    ----------------------
Total                    2,859.17              5,718.34

 

** BTW our TA adverises a 10% discount on their website for most of their listed cruises, sometimes in the form of a cruise fare credit and sometimes in OBC depending on the cruise line. The reason the above TA Discount doesn't appear to be 10% of the Princess Cruise Rate is because the discount is based on the commissionable portion of the advertised rate rather than the entire amount.

The TA has no control over any of those except the cruise rate.  I would not include the air fare, transfer, insurance, or taxes/fees.  I would compare the cruise rate offered by your TA to the cruise rate offered by the cruise line.  I wouldn't get hung up on commissionable or non-commissionable since they don't apply to the cruise line.  Nor has the TA disclosed those.  Suppose the cruise line offered this cruise at $4500 cruise fare, then I would calculate the discount as 1- (4078/4500) = 1- 0.9062 = 9.037%.

Edited May 27, 2020 by RocketMan275

[Ken the cruiser]

4 hours ago, RocketMan275 said:

The TA has no control over any of those except the cruise rate.  I would not include the air fare, transfer, insurance, or taxes/fees.  I would compare the cruise rate offered by your TA to the cruise rate offered by the cruise line.  I wouldn't get hung up on commissionable or non-commissionable since they don't apply to the cruise line.  Nor has the TA disclosed those.  Suppose the cruise line offered this cruise at $4500 cruise fare, then I would calculate the discount as 1- (4078/4500) = 1- 0.9062 = 9.037%.

Actually, the $4,078 figure is the Princess price. The only discount we get from our current TA is the $340 listed as a separate line item.

 

We have never booked a cruise through a TA where the base cruise fare offered by the TA was different than the advertised cruise line fare. Heck, how could you refare a cruise when the cruise line drops the price if the TA is marketing it at a different price? 

[jagoffee]

On May 25, 2020 at 11:15 PM, Ken the cruiser said:

Good point and we probably would, but X is the only cruise line where we actually use their PCC to manage our bookings. The service he has provided us over the years has been worth more than any OBC, refundable or nonrefundable, a TA could give us. He's just that good. Now, if he ever leaves X, we'll probably revisit that decision, especially if we can find a TA that gives refundable OBC.

Perhaps you were mistaken when you said your TA gives a 10% non refundable OBC, since you did not actually use them to book a Celebrity cruise.  I suspect their OBC is refundable.  It is good that you have found a PCC that is worth that level of extra cost.  

[jagoffee]

1 hour ago, Ken the cruiser said:

Actually, the $4,078 figure is the Princess price. The only discount we get from our current TA is the $340 listed as a separate line item.

 

We have never booked a cruise through a TA where the base cruise fare offered by the TA was different than the advertised cruise line fare. Heck, how could you refare a cruise when the cruise line drops the price if the TA is marketing it at a different price? 

The TA that I use for Princess just offers me a lower fare than the Princess price.  It is not shown like yours.  I look for price adjustments by capturing the originally Princess price and then monitoring any Princess reduction.  When I see a reduction or increase in benefits, I have my TA quote me a revised discounted price.

 

Your example would be easier to manage.  I have never had a TA that reflected the discount as a separate line item on the invoice.  I can see why you would like it.

[Ken the cruiser]

21 minutes ago, jagoffee said:

Perhaps you were mistaken when you said your TA gives a 10% non refundable OBC, since you did not actually use them to book a Celebrity cruise.  I suspect their OBC is refundable.  It is good that you have found a PCC that is worth that level of extra cost.  

Possibly. I'm just going by what I wrote down awhile back when we asked what their various perks were for each of the cruise lines we had interest in sailing with. As far as our X PCC goes, yes, we have always been wowed by Piotr over the years.

[RocketMan275]

2 hours ago, Ken the cruiser said:

Actually, the $4,078 figure is the Princess price. The only discount we get from our current TA is the $340 listed as a separate line item.

 

We have never booked a cruise through a TA where the base cruise fare offered by the TA was different than the advertised cruise line fare. Heck, how could you refare a cruise when the cruise line drops the price if the TA is marketing it at a different price? 

My TA doesn't market/advertise a fare.  You have to call/email for a quote.  She takes the current fare then discounts it by about 9%.  If If the cruise line changes the price she recalculates as if it were a new booking. 

[suzyed]

On 5/25/2020 at 8:46 PM, DrivesLikeMario said:

Let me enlighten you:  these are just a few of the cruise lines that do not allow agents to discount their cruise pricing:
Royal Caribbean, Celebrity, Disney, Crystal, Oceania, Azamara, Windstar, NCL, and Silverseas.  

If you have a problem with their rule, you need to take it up with them.  It's been this way for quite a few years.
Most of the remaining cruise lines will not let TAs discount their prices and advertise it (Princess, HAL, etc.).

We had a significant discount from a TA on NCL for an Alaska cruise but that was in 2008 or 2009.  I even called Princess directly to see if they would match it and they said "no".