Cruise Lines Should Target Their Most Profitable Customers

[packercruising]

Huddler, if you were a plant, what kind of plant would you be? :)

[AtlantaCruiser72]

Ok - my soap box is out and I'm gonna get up on it for a bit .....

 

The Cruise Line loyalty programs as they currently exist are rather poor and of little value. Some lines have offered better perks than others (Princess Captains Circle stands out in my opinion), but in reality they offer very little.

 

It would be nice to see more perks afforded to elite level cruisers, but how do you define just what that is? Joe Cruiser who has taken 10 3-day cruises has brought an entirely different revenue stream to the line than Bob Cruiser who has taken 3 10-day cruises. Both have sailed 30 days, but I am willing to bet that per day Joe has spent more overall. Conversely if Bob Cruiser takes 10 10-day cruises to reach the same # of cruises as Joe he has typically spent more in total with the line. So basing Elite levels on # of cruises or # of days is not going to be "fair" no matter which way you slice the cake. Shorter cruises make more money per day - both in cabin revenue as well as onboard spending. Lets face it - there is a reason Carnival has been so successful and there is also a reason why they offer very few cruises over days, most in the 3-5 day range! Coincidentally Carnival has one of the highest repeat guest rates in the industry and virtually no loyalty/elite program to speak of. I am not a fan of their onboard product, but there are many who are, and they have been VERY succcessful at what they do and I admire that.

 

I am sure that the revenue management and marketing groups at X, and all the lines, are aware of who their top 5-10% of spenders are and more than likely these people receive some very quiet and generous gifts for their patronage. The type of people who truly have this kind of money to spend are not the type to go about yapping about how much they spend :cool:

 

Things X could do to reward people who spend more? - 2 words: Concierge Lounge! A small expenditure for a small group of passengers (Suite occupants and top tier Elite members) that goes a long way to providing ancillary revenue. The personal contact that the Concierges provide can help improve bottom line sales in the Spas, Specialty dining, Shore Excursions, Future Cruise bookings, etc. RCCL and HAL have these for a reason and it isn't just about goodwill - the concierges are very good at making guests feel at home and when they feel at home they tend to enquire about purchasing services that they might otherwise not ...... Even though not stated I am virtually 100% positive that these concierges have sales goals in all of the above areas :rolleyes:.

 

As to cruisers who others percieve as cheap - this happens everywhere you travel. There are, and always will be, the traveler who wants to see how much they can get for free while paying the lowest possible fare, stiffing the staff on tips, and so on. These people make up a small percentage of travelers and the cruise lines, as well as other travel providers, factor these people into their overall pricing model.

 

There are also those who go on holiday and spend like the world is about to end. This is also a small percentage of the traveling public, and they tend not to be very brand loyal - they are always searching for the newest, lastest, biggest, flashiest, etc.

 

I venture to guess that 90% of us fall somewhere in between. Some people may not drink, but spend hundreds of $$$ in the casino. Some cruise to Bingo, some spend it all in the Spa, and most of us spead it all around in moderate amounts. I personally feel that the cruise lines have gone too far with price increases as they generally turn more people away from spending than they do to increasing overall revenue.

 

For example on my recent cruises I have stopped visiting the spas. When a 50 minute massage was, say $80 I used to get 2 per cruise. $160 in spa revunue + gratuity. Now that the same massage is typically over $100 I don't go at all. The cruise line has lost my revenue in this department. Another example - I like cruise line logo stuff - hats, t-shirts, coffee mugs, etc. The prices used to be in the $10-20 range per item for these things. I used to buy 4-5 logo items per cruise, so lets say around $80-100 worth. On my last cruise a hat was $30, T-shirt $35, and so on. I did not buy anything as I felt the value for these items was no longer present. Bar prices are up, wine prices have gone up, and don't even get me started on the photo department or Bingo prices! I still drink, eat at the Specialty restaurants, and do some modest slot-machine gambling. The end result is that my onboard spending has markedly decresed as onboard prices have gone up. 5 years ago my average onboard bill for a 7 night cruise was $7-800 for a 7 night cruise, now it rarely hits above $300. I would still spend the extra $4-500 if the value of the goods/services were commensurate with the prices. The cruise lines have found price points in many departments that have turned this particular cruiser away from spending and have lost my revenue. I do not consider myself cheap, but I want decent value for my money, not to be gouged and used as a floating ATM.

 

On the opposite note - the longer I have cruised, the more I have been willing to spend on the cabins themselves. I always do at least a standard balcony, and if the price seems fair will typically book a Concierge Class room on X, and want to do an Aquaclass room at some point on the Solstice class of ships (I LOVED the Solstice!!!!). The added amenities that come with these rooms seem small but make me feel slighty more pampered and valued. This is one thing I think X has been very smart and successful with as a way to reward those who are willing to spend extra on accomodation.

 

Ok - stepping down off my soap box to contemplate how wonderful life at sea is and to dream about future cruises. :D

[Shirley and Les]

...As the CEO, would you rather have those million people on average spend $250 onboard or $2500 onboard?....

Obviously, the answer is $2500.

 

But.................................................................

 

The CEO's have already made their decision. All of the major cruise lines are going to bigger (number of passengers) ships and increasing the size of their fleet. Their course of action is to accept the $250 per passenger and increase the number of passengers.

 

Building bigger ships implies huge capital expenditure. On the other hand, they could cultivate their base of high rollers with a big smile, a pat on the back (or wherever ;)) and a martini or two without spending much money. Their decisions are based on their perception of what will bring in the most revenue (and hopefully profit) and reward their stockholders. Of course, we don't even have to talk about the CEO's performance bonus.

[Veronica13]

My Dad and I had a long talk about this subject on the phone today.

 

As MEGA cruisers since the 70's, (my parents at least 100+), less for me, we agree these CEOs have made HORRIBLE DECISIONS in the last few years and the lines will never get their reputations back.

 

We are business people, and understand the concept of making a profit. We also understand the concept of STAYING in business during rough times. Big "Booooo" to the CEOs who will eventually be fired (I have no doubt) but not until they walk away with huge salaries, bonuses and the cruiselines reputation.

 

What will be left after all this fallout? McDonalds ships with McDonalds service, food and quality. Should be a big financial hit for Dollyworld:cool: