Monday, October 19, 2009

Seabourn Offering Free Air - Is it Time? Does it Matter? Is it Free?

I wrote last week about how Regent Seven Seas Cruises "free air" and "free tour" pricing when compared to Seabourn's straight pricing really shows "free" is not "free", but rather "packaged". The same holds true for literally every other cruise line that offers "free" air...taking a credit for that "free" air may well work out better.

But, alas, there are some quandaries:

1. Is there confusion or just some difficulty in comparing cruises with two different pricing schemes?

2. Are travel agents savvy and motivated enough to explain the differences to their clients.

Let me take No. 2 first.  Many travel agents, generally, have a problem with really working for their clients. They are, in reality, nothing more than order takers. Heck, most travel agents haven't even been on more than a couple of cruises...and then the number that have been on the luxury lines is even less. (Remember, just because a travel agency sells luxury doesn't mean that all of its agents are knowledgeable and experienced with luxury.)

So, if Seabourn offers pricing structure A, Regent offers B, Silversea offers C and Crystal offers D, how many travel agents -who may find comparing the products themselves challenging - will be able to accurately advise their clients of the actual net pricing?  And of those that are "able to", how many are "willing to"?

But there is another, darker, motivation by many travel agents:  "Free Air" promotions provide the agent with a larger commission because the pricing is higher and because there is no commission on air which is booked directly.  Couple that with the "idiot-proof" nature of the air (the cruise lines arrange the air and do all the work), it allows the travel agent to make more commission while performing less work. 

Let's add up those points:  "Free Air" promotions pay travel agents more money to do less work.  Regardless of the fact that the cruise client may suffer as a result, which offer do you think the majority of travel agents will jump on and push to their clients?

You may ask, "Isn't my travel agent supposed to get me the best deal?"  Well, the cruise client is, in part, also at fault.  Many see the ads for "free, free, free" and jump on it, instructing their travel agent that they have, in fact, drank the Kool-aid and believe it is the best deal, so it is the one to be booked.  Not many travel agents will take the time to educate their clients.  The agent will give the clients what they want....and get paid more...and do less work.

In January 2009 I wrote a piece which discussed this topic as it relates to commissions on Non-Commissionable Fares (NCF's).  You can read it here.  I concluded, in that article:

... As Mark Conroy, President of Regent, is quoted in Travel Weekly as stating, "We think it gives the agent one more reason to sell us versus the other guy."


I am sorry, for me it does not. I know it may seem I am oh so skewed toward Seabourn, but try this on for size: While Regent is trying to increase sales by lining the travel agents' pockets with a little bit more cash, Seabourn is running 60% off sales on its slower selling cruises...keeping more cash in its guests' pockets and generating more commissions for its travel agents through those sales...

Finally, I do agree with Regent that there should not be any NCFs and most every travel agent will agree with me on this. I hope all of the cruise lines drop the NCFs...or at least limited them to actual port charges. But make no mistake, the motivation should be it is a good business practice; not a motivator to push clients one way or another.  

Guess what?  Many travel agents are pushing Seabourn for "free air" promotions and admit they leading their clients to those type of offers.

There is a New York area clothier, Syms, which has the motto, "An educated consumer is our best customer."  I believe in that motto and so to my clients.  (I believe that is why, in part, they use me and my business is significantly growing during these difficult times.  Great service and caring obviously also helps.)  That is why "doing the math" and assuring that ultimately the best cruise for my client is sold, not the one I make the most money on or which is the easiest to sell is, is how I operate.

But that now brings me back to Question No. 1. Is there confusion created by different marketing schemes?  The answer, by now should be simple:  Use a travel agent that is willing to educate his clients and is willing to put the time in and there will not be any confusion...only the best choice for the client.  However, that is a great concept  that fails so often in practice.

So maybe, not because it is right, but because it is necessary, Seabourn should offer "free air".  It'll bother me and drive me crazy having to explain even more that nothing is free, but it may be time.  I just hope that if it happens Seabourn is transparent about the pricing and doesn't do what some cruise lines do by offering a small credit for not taking the air...and slipping in the hundreds of dollars in taxes and fees that also fall by the wayside.  (I mean seriously, do you think most cruise lines are going to let an opportunity to make a few extra bucks slip through the cracks?)

If you want discuss this, please click over to The Gold Standard Forum and let us know what you think.