Friday, January 7, 2011

What Does Seabourn's Move to Seattle and Working With Holland America Mean?

Earlier today I posted the press release about Seabourn's shake-up.  Now, what the heck does it mean?

First, a foundation.  In my opinion, Seabourn is the finest cruise product on the market today.  Even if you think there is one or two better, there is no question from any legitimate source that it is among the best. 

However, Seabourn's marketing has been terrible.  It has been terrible in pretty much every respect. 

1.  Seabourn has bland and confused brochures and mailers that consistently fail to provide an exciting or informative message.  A person could not tell Seabourn's 2009 marketing from its 2010 marketing from its 2011 marketing.

2.  Seabourn has engaged in pricing strategies (such as heavily discounted prices) that undercut its own market.  From my experience,  those price reductions caused me to lower prices on previously booked cruises in amounts greater than the amounts received from the new, but lower priced, cruises subsequently purchased.

3.  Those lower prices tended to bring in a significant number of folks that wanted to "get their money's worth" rather than enjoy a Seabourn experience.  This resulted in much more work for the staff, more expense for the line and a different onboard experience as perceived by some of its guests during certain periods (like last summer).

4.  Seabourn de-incentived most travel agents (those focused on their income first) because Seabourn's lower prices meant that commissions (which are based upon a percentage of a sale) became half of what, say, a Regent Seven Seas cruise would pay that same agent for a similar-enough cruise.  (Yesterday I wrote about how Regent, in some instances, is selling cruises for almost double what Seabourn does:  Regent Seven Seas Pricing - It Is Out of Control...Seriously, Why Pay That Much?)

5.  Seabourn's travel agent booking engine is a nightmare.  Lost bookings, payments that don't go through, an inability to find the best suites, system lock-ups, general limitations, etc.  If you ask anyone as Seabourn...or most people that call me while I am working with its Inside Line...they will confirm I hate the system.  On the other hand, I do use the Holland America/Cunard/Princess/P&O Cruises Australia booking system and it is pretty darn good.

While I am very pro-Seabourn as a product, there is much that I do not say about the "back end of the business" because, honestly, it is not relevant to Goldring Travel providing its clients with the best cruise experience.  My protests on the above issues, and a few others, have been loud and, to some, even offensive. 

The point is, however, that the departure of Pamela Conover and some others are not a shock to me.  It doesn't make me happy, but then again, from my perspective it is not about being happy it is about business.  And having the best product out there and not having comparable marketing is not good.  (Imagine if I was the best travel agent out there and people couldn't find enough about me about me to make them comfortable using me?  I would be out of business...if I had a business.)

To be sure, Seabourn is not out of business.  Seabourn is evolving.  It is making some changes - possibly drastic changes - in how it does business...not what its product is.

As an example of how this can work to Seabourn's great advantage, let's take a quick look at Regent Seven Seas Cruises.  It was floundering as a standalone brand with poor marketing and some incredible inefficiencies which lead to, in part, poorly maintained ships and a downward slide in service and cuisine.  It was then taken over by Apollo Management and joined, in part, through Prestige Cruise Holdings with Oceania Cruises...a well run operation with great marketing.  Over the past couple of years Regent's backend operations have been integrated with Oceania's which has created some real efficiencies.  Like the product or not, Regent's marketing changed dramatically and it now sells cruises at a huge (and profitable) premium and its backend costs are way down.

I do want to point out that, for example, Princess and Holland America use the same booking engine, but the vast majority of the cruising public has no idea that these two companies are owned by Carnival Corp., no less that they use the same computer software systems.  Further, there is no question that these cruise lines are in competition with each other.  And, would you believe, that Cunard and Princess share operations?  Yep.  What effect has that had on each other's cruise experience, policy terms, etc.  I think you would be hardpressed to figure out any.

So do not think that because Holland America and Seabourn are going to share somethings, life as Seabourn is over.  (BTW, how many of you know that Seabourn used to be in a similar relationship with Cunard?  And that was just a few years ago!)

I have no idea as to how much of this is going to play out.  I am also certain there are going to be things that happen that I will not be happy about.  However, I am not as negative about the move as you might have thought.  (That said, without question, I am quite upset, personally, for those people in Miami that have helped me immensely over the years that are hurt by this move.  I mean we are talking people here!)

Is this going to make me pause to recommend or sell a Seabourn cruise?  Absolutely not.  Why?  It is the best cruise product...and that is not going to change.