Royal Says New Pricing Policy On Track

Cruise Week

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 the trade.

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 travel partners.

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.

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