20 May 2008

Cruise industry must focus on value - not discounts

The cruise industry has been urged to focus on its value proposition rather than discounting as the UK economy weakens.

Island Cruises managing director Patrick Ryan made the plea while suggesting that with the US in recession, cruise will do well there due to the "sheer value" provided.

"As recession blows through this country this value proposition will make cruise stand out for any customer looking at their holiday spend closely,ââ¬~ he told the UK Cruise Convention.

He described the value proposition as the ââ¬Åâœbiggest missed point in this industryââ¬~ and urged cruise lines and agents alike to refocus their marketing efforts.

He was speaking as more than one agent attacked what they described as ââ¬Åâœdodgy dot comââ¬~ retailers heavily discounting cruises to a point where they can no longer compete.

Homeworker Jenny Jackson (Personal Travel Advisors) accused online companies discounting methods as undervaluing the whole cruise offering.

"I am trying to compete against people who are getting one or two per cent margin. The whole industry is being undervalued by discounting," she said.

Seamus Conlon, managing director of leading cruise retailer Cruise.co.uk, said that only a small percentage of his company's sales were forced due to price matching.

"The vast majority of offers are already in the brochure, we just market them differently,ââ¬~ he said. ââ¬ÅâœWe donââ¬â¢t indulge in a discount market, thereââ¬â¢s not as much discounting as people are making out."

But Conlon predicted that cruise prices would continue to fall and that will lead to more people taking cruise holidays.

"A lot of people think itââ¬â¢s expensive. That is a perception that has to be dealt with," he said. "As prices fall, more people will come into the market. Thatââ¬â¢s a good thing."

He revealed that his company had attracted 450,000 unique visitors to its website since January and predicted that more would actually start booking cruises online as they get more used to the idea.

Carnival UK commercial director Peter Shanks told delegates there was a vast market for agents to go for with a market growth of 12% a year for the next five years.

by Phil Davies  

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• Cruise Lines Give a Discount Message
  
  

  Cruise lines lead the way with the discount message through their discounted brochure prices and by offering on line booking discounts and then blame agents for devaluing the product. We have to discount to match the cruise lines on line price before we even start to have to compete in the market place.

  By Roy Jones, Tuesday, May 27, 2008
• When is a discount not a discount ?
  
  

  Answer; when it's a special offer! According to Seamus Conlon they don't discount they only market in a different manner. Peter van der Schee tells us we should leave the discounting ( or special offers ) ?? to them. Everyone else says we should not devalue the product in any way at all. It seems to me a case of wanting your cake and eating it as well - even if it is smaller as a result of a special offer or discount !! The package holiday industry educated the travelling public in the 70's and 80's to expect a discount when there was too much capacity around, will the cruise industry fall into the same trap ??

  By Peter Cansick, Tuesday, May 20, 2008