In conjunction with reporting solid Q2
earnings to Wall St. on Friday, Royal Caribbean also addressed pricing issues
impacting travel agents in a manner that meaningfully shows the importance of
Chairman & CEO Richard Fain noted last
minute discounts frustrate travel agents. "We can't afford to frustrate
them. We're trying to get more bookings early on."
So it's important that Fain said
Royal's price integrity policy is working well: "It's still
early days, but the impact we've seen from the load factor perspective is
relatively small and is in line with our expectations. Our intent with the
policy is to achieve happier guests, travel agents and better branding. It does
seem we're on the right track. In fact, during the last period we extended the
program. We went from a policy coverage of 10, 20, 30 days before the cruise to
covering 10, 20, 30 or 40 days prior to sailing."
Fain said "vague efforts" won't
work with such a pricing policy, contending that "firmness and
consistency" is required to achieve credibility with both guests and
On the booking front, signs were positive.
Almost predictably, eastern Med sales were softer and Latin America is
struggling. But the big news is the Caribbean "showing particular
strength" and China continuing its ascent.