Retailers Say Value-Adds Beat Price Reductions

Cruise Week

Retail leaders are pleased to note that more lines are doing creative things to fill cabins rather than just dropping rates. Value-adds are being used more frequently, and the cruise lines using them say the concept seems to have traction with consumers.

"Promotions like our fabulous Explore 4 and the launch of our new ReadySetSail program really demonstrate that consumers understand the value proposition," says Holland America Line V.P. Eva Jenner. "You're starting to see that people are no longer talking so much about price, but about the value of a cruise. I think that we're starting to see that switchover now from ‘everything's price-driven’ to ‘we now see the value of the cruise and everything that it offers’."

On the retail side, Brad Anderson, Co-President, Avoya Travel, says that value-adds are very appealing to today's consumers: "The way people shop, not just for travel, but for everything has changed," he says. "Online consumers, which is almost everybody, are savvy and understanding how to navigate. They like value-adds. The reality is when you're shopping online for a cruise now, you're looking at not just the price but what's included and what extras can you get."

There are some quibbles from retailers, however. While Norwegian's new value-add program is being well-received, some sellers noted that in its early stages, unlike RCI and Celebrity's value-adds, it wasn't combinable with some other promotions.

On Monday this week, Annette Youngbauer of Travel Leaders described a situation where she arranged for a group to take a Med sailing on Epic in May, which ran into some challenges after Norwegian announced its January "Freestyle Choice" initiative. Her problem: "If you have group space you're not allowed to use that. So if we have anybody that wants to do that we have to book outside the group and migrate them into the group. You then lose the advantage of having your group rate locked in."

She also said that Norwegian made pricing adjustments that somewhat undermined the initiative's appeal. The strongest component of the offer is the drinks package, available to those booking balcony cabins and above. "Overnight, all the balconies went up $200 for every sailing. They give you the drink package, but they up their rack rate."

On Tuesday, she updated Cruise Week that Norwegian responded and made the desired changes moving forward. "I got an e-mail from NCL (mass generated) on Monday afternoon saying effective immediately, NCL will allow you to combine the group rates with the January promo along with other discounts such as Latitude, Military, AARP etc.," reports Youngbauer.

She's not totally satisfied: "Well that's great, but for those of us who already changed our space, they won't go back and revise."

(will not be published)