Still Hung Up On Pricing | TravelResearchOnline

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Still Hung Up On Pricing

Susan SchafferTravel professionals seem to be hung up on cruise pricing, and letting it feed into our clients’ focus on pricing.  Recently, a travel professional lamented that Celebrity’s most recent promotion wasn’t as attractive as the promotion it replaced, and was expressing concern at reduced Celebrity bookings in the future.  The cruise lines are attempting to re-program passenger thinking, rewarding bookings made further out.  In order to succeed, they have to either increase prices as departure dates get closer and / or they have to provide more attractive promotions further out to convince passengers to book earlier.

These strategies also help travel professionals.  As cruise fares increase, so do our commissions (commission on $1,000 cruise fare is going to be less than the same commission percentage on a $1,300 cruise fare).  You would think travel professionals would be ecstatic about an increase in cruise fares (and commission).  Instead, there is fretting about future decreases in sales, as clients look to book cheaper cruise lines or not book at all.  Simply put, we can have it all: lower cruise fares plus higher commissions.

And if we focus on price, what are we communicating to our clients?  Are we talking them out of cruises, as we apologize for what we interpret as high pricing?  Are we suggesting that they wait to see if better prices or promotions come down the pike?  If so, we are shooting ourselves in the foot, not to mention hampering the cruise lines.  We demand they treat us as partners, but we aren’t returning the gesture.

Before we can address the issue with clients, we have to move our mindsets away from a price focus.  And we need to be convincing.  If we aren’t convinced ourselves, we’ll never convince a client. We should be selling the value of the cruise package we are presenting to our clients.  What are they getting for their vacation investment?  Accommodations, food available 24/7, not having to pay for room service, and Vegas and Broadway style shows as well as other entertainment, multiple ports of call that don’t require dealing with multiple airports (and all of the hassles that can entail)?

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Consider car shopping.  The purpose of a car is to provide transportation from point A to point B.  Ideally we’d like our cars to be reliable, and that the service and maintenance costs are reasonable.  So why don’t we all buy Kia Fortes? (according to Autotrader.com, it is the cheapest compact car you can buy in 2015.)  If only price was an issue, that would make sense.  It would get you from point A to point B.  It has doors and windows, windshield wipers, an engine, transmission and a battery.  It runs, but it’s not necessarily sexy.  It’s practical.  Why do so many people buy Hondas, Toyotas, Fords, BMWs or other makes of cars?  Cars which are definitely more expensive than that Kia Forte?  Because they see VALUE in buying one of those cars instead.  It might be leather seats, more horsepower, or simple bragging rights.  But there is an emotional reason why they buy the car that they do over a Kia Forte.

Picking a cruise isn’t different.  You will have the budget-strapped shopper that can’t afford the BMW (luxury world cruise) and really doesn’t have the option other than to consider the Kia Forte (a mass market Bahamas or Caribbean cruise).  But that does not describe the vast majority of most cruise shoppers.  What they want to know is that they are getting the best DEAL for the price that they are paying.  If they have the cruise of their lifetime, they will likely not remember in 6 months or 6 years how much it cost them, but they will talk for years about that amazing soufflé they had for dessert on the ship, the amazing shore excursions that you recommended, the family bonding time they had, etc.

As cruise lines reduce capacity in over-saturated destinations (primarily the Caribbean) prices will stabilize more.  We need to stop focusing so much on price, and start focusing on the value that cruises provide to our clients.  We need to counsel our clients and help them see the value and not just the dollar signs.


 

Susan Schaefer is the owner of Ships ‘N’ Trips Travel (www.shipsntripstravel.com) located in Tennessee, and specializes in leisure travel with a focus on group travel and charity fundraisers. Through their division Kick Butt Vacations (www.kickbuttvacations.com) she focuses on travel for 18 to 23 year olds. Susan can be reached by email at susan@shipsntripstravel.com or by phone at (888) 221-1209.

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