Cost cutting procedures

[budmeister]

Hi,

 

I am working on an weekly assignment for  a Masters economics class. As an addicted cruiser,  I looked at cruising. Norwegian is one of the big three, but with lower profit margins than the other 2. I have never been on a Norwegian cruise. Has Norwegian done some of the cost cutting that RC has?  Such as: Coke machines for fill up instead of the bar for soda packages, less paper daily activities- more digital, no more nightly towel animals and mints, no more nice room gifts for middle tier, the big wide window lounge at the front of the ship used for revenue generating, not open as a relaxing lounge for all. I am not a troll, and need to write 300 words tonight. If you do not feel it is appropriate to answer, I will come up with something else.  If you have different cost cutting ideas, I am open. I just thought about the ones  I am aware of. 

 

Thank you!

[JamieLogical]

I haven't been on the other lines, so I can't speak to those. Of the examples you mention, NCL has stopped leaving towel animals each night, unless requested. They have turned some deck space on top decks into the Vibe area, which requires a purchased pass. On the newest ship, they eliminated Spice H2O, their adults-only outdoor deck space/bar. They have added upcharge activities on their upper decks, such as lasertag and go-karts. They have also added an upcharge virtual arcade space called the Galaxy Pavilion.

 

Prior to COVID, they were still printing paper dailies and leaving them in the rooms. They have recently been pushing an option for digital bills/receipts at the end of the sailing rather than leaving a paper on in your room, but you can still opt to receive a paper print-out. For the middle loyalty tiers, they do still do sparkling white wine and chocolate covered strawberries in your room on the first day.

[trivimp]

They've also added more upcharge food venues; not just the new specialty dining restaurants, but the luxury bakery & gelato places on the newer ships.  Not sure if that counts as cost-cutting, but it is certainly a new revenue source.  

[robcolem]

They reduced the specialty dining nights from 3 to 2.  

 

In opposite, they have added fee based activities as "benefits" like the go carts and laser tag. Just takes away the deck space and makes what's left even more crowded.

 

Overall, I say the inclusiveness has been reduced and fee based activities and eateries have been added.

Edited June 3, 2021 by robcolem

[JamieLogical]

Just now, robcolem said:

They reduced the specialty dining nights from 3 to 2.  

 

Ah, yes. Forgot about that one. Specifically, that reduction was for 6-8 day cruises, but all sailings had their number of "included" specialty dining meals reduced.

[graphicguy]

Too late for the 300 words, but some (most?) of this is a sign of the times.  Going digital where possible to eliminate paper (or the more eco friendly paper vs plastic straws) is a good thing.

 

Some of it is a nod to better efficiency, too.

 

But, shifting revenues from one area to boost another is something you could have written about, too.

 

Personally, I don’t mind the shift from smaller pools to get better entertainment.  And, unless you’ve been on an NCL cruise, particularly on the larger, more recent ships, the free entertainment on board trumps a bigger pool, as just one example.

 

So yes, some areas have been cut or eliminated, but others have been vastly improved upon.  Got to put that in your paper, too.

[BermudaBound2014]

You have lots of cost cutting measures. Here are some revenue generating items:

 

1) the bid up program. 
2) vibe passes

3) offering a free $50 shore excursion for one guest  (I read this significantly increased profit in the shore excursion dept)

[Trimone]

Cost cutting or do we expect more? In my view the Haven is what cruising was 20 years ago, so what’s the next 20 years going to bring with sustainable development! 

[FLAHAM]

I find the Freestyle Coke machines on Royal to be far superior to getting soda from a bar with just a few choices.

[boatseller]

Be aware, a lot of changes get labeled 'cost cutting' just because they're a cruiser's favorite thing.

 

Complimentary Room Service is something I was surprised lasted as long as it did.  It's hugely expensive to offer and benefited relatively few people.  I'm fine with the Service Fee so I'm not subsidizing something I don't use.

 

Of course, if they cut trivia games to reduce headcount, I'd be leading an insurrection!

[Two Wheels Only]

3 hours ago, robcolem said:

They reduced the specialty dining nights from 3 to 2. 

 

NCL reduced the specialty dining promo uses from unlimited to 4 to 3 to 2 for a 7 night cruise.

 

3 hours ago, budmeister said:

...the big wide window lounge at the front of the ship used for revenue generating, not open as a relaxing lounge for all.

 

By eliminating staterooms and adding Observation Lounges, NCL lose money there. Compared to Escape (no forward-facing lounges), Joy, Bliss, and Encore lose 2 Deluxe Owner's Suites and 4 Owner's Suites. Those suites generate somewhere near $100K per sailing. 

Edited June 3, 2021 by Two Wheels Only

[HowardK]

By 2018 they removed lox from the breakfast buffet. Not cost cutting but on my 2018 cruise I upgraded my room for I think $50, but they charged $20 as the gratuity increased on my promo from the year before. 

[mpdog42]

1 hour ago, boatseller said:

Be aware, a lot of changes get labeled 'cost cutting' just because they're a cruiser's favorite thing.

 

Complimentary Room Service is something I was surprised lasted as long as it did.  It's hugely expensive to offer and benefited relatively few people.  I'm fine with the Service Fee so I'm not subsidizing something I don't use.

 

Of course, if they cut trivia games to reduce headcount, I'd be leading an insurrection!

This is the attutude that has allowed the cruise lines to do cost cutting!! The "if i don't use it, then why should I pay for it"......

[boatseller]

2 minutes ago, mpdog42 said:

This is the attutude that has allowed the cruise lines to do cost cutting!! The "if i don't use it, then why should I pay for it"......

No one complains about money they spend on new things they don't use.

 

Those apps don't magically appear in the app store.

 

Or the expense of producing full theater productions.  Or onboad activities unimaginable even 10 years ago.

 

The only cost cutting I've been affected by is in the MDR on Royal Caribbean.  It's as edible as Universal Quick Servce (except in the Wizarding World).

[mpdog42]

I sail without children but yet i have to pay for the Children's program...See where i am going at?

[Zippeedee]

1 hour ago, mpdog42 said:

I sail without children but yet i have to pay for the Children's program...See where i am going at?

I consider it a benefit to have the kids kept in the clubs and not running free all over the ship. Happy to pay for that! (with apologies to all of those well behaved kids not causing trouble)

[KeithJenner]

1 hour ago, Zippeedee said:

I consider it a benefit to have the kids kept in the clubs and not running free all over the ship. Happy to pay for that! (with apologies to all of those well behaved kids not causing trouble)

And making cruising family friendly means that more people can cruise, thus increasing the market and keeping prices down. Also introduces new people to cruising.

 

Kids clubs pay for themselves many times over on every cruise without anyone paying a penny directly for them.

[budmeister]

Thanks everyone! You gave me some great ideas!

[3kidsncats]

11 hours ago, graphicguy said:

Too late for the 300 words, but some (most?) of this is a sign of the times.  Going digital where possible to eliminate paper (or the more eco friendly paper vs plastic straws) is a good thing.

 

Some of it is a nod to better efficiency, too.

 

But, shifting revenues from one area to boost another is something you could have written about, too.

 

Personally, I don’t mind the shift from smaller pools to get better entertainment.  And, unless you’ve been on an NCL cruise, particularly on the larger, more recent ships, the free entertainment on board trumps a bigger pool, as just one example.

 

So yes, some areas have been cut or eliminated, but others have been vastly improved upon.  Got to put that in your paper, too.

Except for people that don’t care about the entertainment— I’m neither a big pool or show person, but I know people that live at the pool and would switch to land based if the pool area is too small.  I also have friends who never visit the pool, but are enthused about the shows.  So your opinion that better shows trump better pools is just that — your opinion and not necessarily a model for a majority of customers.  
 

Hopefully the paper also including a nod to the balance a company needs to hit, so as not to alienate too many customers if they reduce a benefit that is liked enough to rile people up

[mpdog42]

23 hours ago, Zippeedee said:

I consider it a benefit to have the kids kept in the clubs and not running free all over the ship. Happy to pay for that! (with apologies to all of those well behaved kids not causing trouble)

Yeah Should have considered that before i posted...😁

[mpdog42]

21 hours ago, KeithJenner said:

And making cruising family friendly means that more people can cruise, thus increasing the market and keeping prices down. Also introduces new people to cruising.

 

Kids clubs pay for themselves many times over on every cruise without anyone paying a penny directly for them.

just because the Big Three went to a more family friendly cruise, Doesn't mean that was a good move for all people...How about a Budget friendly cruise line with no kids...That's right.....there isn't one!!

[KeithJenner]

10 minutes ago, mpdog42 said:

just because the Big Three went to a more family friendly cruise, Doesn't mean that was a good move for all people...How about a Budget friendly cruise line with no kids...That's right.....there isn't one!!

My view is nothing to do with what the big three did.

 

It is experience. We cruised and then had a kid. If NCL didn’t cater for kids then we wouldn’t have been on any of the 20ish cruises we have done as a family and my wife and I could easily have other priorities now that we are looking at being able to holiday by ourselves again. On top of that our son would probably not see cruising as an option himself.

 

I’m sure that a budget friendly cruise line without kids would have an appeal to many, but if we are talking about what the lines are offering, the big three didn’t come up with their offerings by accident. They know their market far better than I ever will and we can see what their conclusion was.

 

Personally, however much I hate kids (which is a lot), they have never been enough of an issue on cruises to me for their presence to have an impact on how we would cruise as a couple. The kids club is a major reason for them not being a problem, so it works both ways.

Edited June 4, 2021 by KeithJenner

[mpdog42]

1 minute ago, KeithJenner said:

My view is nothing to do with what the big three did.

 

It is experience. We cruised and then had a kid. If NCL didn’t cater for kids then we wouldn’t have been on any of the 20ish cruises we have done together and my wife and I could easily have other priorities now that we are looking at being able to

holiday by ourselves again. On top of that our son would probably not see cruising as an option himself.

 

I’m sure that a budget friendly cruise line without kids would have an appeal to

many, but if we are talking about what the lines are offering, the big three didn’t come

up with their offerings by accident. They know their market far better than I ever will and we can see what their conclusion was.

 

Personally, however much I hate kids (which is a lot), they have never been enough of an issue on cruises to me for their presence to have an impact on how we would cruise as a couple. The kids club is a major reason for them not being a problem, so it works both ways.

When did you first start to cruise?

[KeithJenner]

2 minutes ago, mpdog42 said:

When did you first start to cruise?

First cruise was in 2001. I just checked the date and we disembarked 20 years ago yesterday.

[mpdog42]

Cool, got you beat by a couple of years.. but i do understand what your trying to explain! Thanks for the talk!!

Edited June 4, 2021 by mpdog42
correct