What causes prices to go up?

[JAMESCC]

I've been monitoring a Explorer cruise in October because we are not sure if our vacations are gonna match up. Anyway the category we want went up by 21 bucks today. What makes the price of a cruise go up or do all of them go up as you get closer? I mean we are still pretty far off from late October so i wonder why it went up, not that 21 bucks would deter me, I'm just curious why. Thanks for any help.

[Budget Queen]

Pure supply and demand. Sales predict they will get the higher price.

[sjcruiser]

Demand causes the prices to go up. Sometimes the prices go down. A few years ago I booked a Thanksgiving cruise on the Explorer around 3-4 weeks before sailing. I had been watching the cruise for months, but due to my school schedule didn't think I would be able to schedule or pay for the cruise. Things worked out, and the price had dropped to almost half of what if was when I first started watching it. The price dropped several times in the three weeks before the cruise, and we were able to upgrade to a hump balcony, and the total cost was less than $800 pp. The ship wasn't crowded during that week either.

[JAMESCC]

So are you saying the cruise is selling faster than they thought, therefore demand is higher in their eyes so prices went up? Am I following the procedure right for prices going up? Again this is purely out of curiosity, not complaining.

[cruzeluver]

So are you saying the cruise is selling faster than they thought, therefore demand is higher in their eyes so prices went up? Am I following the procedure right for prices going up? Again this is purely out of curiosity, not complaining.

 

Correct. The faster a cruise sells the faster prices will go up, and if a sailing is not selling very well prices will come down.

[Cigar King]

I'm pretty sure that RCI considers my interest in a cruise, and raises the prices on those ASAP... ;-)

[Familygoboston]

James- did you know that you can book a cruise and if you cancel it for any reason before the final payment you get 100% of your deposit back? Also, if before that final payment your cruise goes down, you can get the lower price?

(just check that if you use a TA, that they also adhere to that policy)

If you can afford the deposits,( and with today's interest rates you are not out that much if your money sits at RCL rather than your bank!;)) sometimes it's worth it to book it and then if you cannot go, cancel before final payment date.

This saves you the pain of watching it inch up until you know you can go for sure.

[FLACRUISER99]

Simple, RCCL raises prices because they can!!:rolleyes:

[JAMESCC]

James- did you know that you can book a cruise and if you cancel it for any reason before the final payment you get 100% of your deposit back? Also, if before that final payment your cruise goes down, you can get the lower price?

(just check that if you use a TA, that they also adhere to that policy)

If you can afford the deposits,( and with today's interest rates you are not out that much if your money sits at RCL rather than your bank!;)) sometimes it's worth it to book it and then if you cannot go, cancel before final payment date.

This saves you the pain of watching it inch up until you know you can go for sure.

Hold on a sec. are you sure about that? I could of sworn a few years ago we booked by calling RCCL and then canceled a month later and I though we lost the deposit? I thought we lost like 200 bucks or something last time? And we ended up booking later too, that was the kicker.

[reeran]

Hold on a sec. are you sure about that? I could of sworn a few years ago we booked by calling RCCL and then canceled a month later and I though we lost the deposit? I thought we lost like 200 bucks or something last time? And we ended up booking later too, that was the kicker.

 

I think the rules are different outside of the US, but if you live in the US and book a cruise and decide to cancel before final payment you get your deposit back. I also just learned today that it is to your advantage not to make the final payment until it is due because if the cruise is all paid for and the price drops you cannot get the discount. You could however book at the new price and cancel the first reservation, provided you are willing to lose that particular cabin.

[JAMESCC]

Thanks I live in the US, but I'm pretty sure we lost 200 bucks. If you get a guarantee or can they talk you into something when on the phone that would cause you to lose the deposit if canceled? That might have happened last time.

Oh hold it I remember what happened! We were stupid, or not informed, your pick. We just assumed the deposit was not refunded and when final payment came we never made it but we never inquired about getting the deposit back. We just automatically thought it was not refunded. Now we know, thanks and YES I feel VERY embarrassed about this little story. Please don't laugh too hard, we lost 200 bucks that time.

[gw2fll]

Hold on a sec. are you sure about that? I could of sworn a few years ago we booked by calling RCCL and then canceled a month later and I though we lost the deposit? I thought we lost like 200 bucks or something last time? And we ended up booking later too, that was the kicker.

If you are in the UK, you will lose your deposit. However, if you are in the US you can cancel prior to final payment without penalty.

[RCCL Fan]

the UK people have to follow these rules even if they book through US agent?

[Cotswold Eagle]

It is not simple supply and demand that determines pricing of cruises. Like the airlines and hotels, the lines use a system known as revenue management. Cabins are a fixed, perishable resource (you can't make more of them on a particular sailing on a particular ship and they become worthless once the ship has sailed) and revenue management aims to maximise revenue by devising strategies to sell the right product to the right person at the right price.

 

They will typically micro-segment the market and devise different marketing and pricing strategies for each segment, by predicting the demand for each cruise/category of cabin at the micro-segment level and (broadly speaking) applying inventory and pricing controls. So it is entirely possible that prices for the same cabins could be going up in some markets and down in others. Cruise lines also need to adjust occupancy demand through similar measures, because they can't sell all the berths in all cabins, an extra variable airlines and hotels don't have.

 

There's plenty of literature online on this (see also yield management, which is inventory control focused, but often used synonymously), if you are really curious - it's fascinating stuff :) As an example, not allowing existing bookings to take advantage of price promotions, which are designed to stimulate new demand - this is segmenting by time of booking. Overbooking is also a common feature of RM systems, and is probably a reason for the occasional visits of the upgrade fairy. I suspect overbooking in cruises is more about the expected numbers of those who don't make final payment (given that some very large segments can get deposits back, as outlined above), rather than actual no-shows on the day, which is more common for airlines.

[marci22]

What makes the price of a cruise go up or do all of them go up as you get closer? I mean we are still pretty far off from late October so i wonder why it went up, not that 21 bucks would deter me, I'm just curious why. Thanks for any help.

 

I've seen prices keep going up even when the amount of cabins didn't change, or went up. Then after final payment is due, the prices come down again. I don't think they follow any one formula with their pricing.

 

You just have to keep watching and book when you think the price is good. The first time I went on Royal Caribbean, I just called up a TA and told her I wanted to go on a cruise. I didn't question the price at all, and I certainly never looked before or after I booked it. That's probably what most people do.

[TEXASMUNK]

is 100% accurate! Yield Management is a very sophistocated process today. It involves suppy, demand, seasonality, economic factors, bookingn history and marketplace dynamics.

 

Started with the major US airlines in the 70's ad deregulation began and has spread to cruises, resorts, etc.

[donaldsc]

Demand.

 

DON

[LovesCruising]

I'm pretty sure that RCI considers my interest in a cruise, and raises the prices on those ASAP... ;-)

 

CK - your too funny!:)

[Sue L]

I think the rules are different outside of the US, but if you live in the US and book a cruise and decide to cancel before final payment you get your deposit back. I also just learned today that it is to your advantage not to make the final payment until it is due because if the cruise is all paid for and the price drops you cannot get the discount. You could however book at the new price and cancel the first reservation, provided you are willing to lose that particular cabin.

 

Incorrect, if you pay early you can STILL get the price drops until the real final payment date.!

[maxxedout2]

It is not simple supply and demand that determines pricing of cruises. Like the airlines and hotels, the lines use a system known as revenue management. Cabins are a fixed, perishable resource (you can't make more of them on a particular sailing on a particular ship and they become worthless once the ship has sailed) and revenue management aims to maximise revenue by devising strategies to sell the right product to the right person at the right price.

 

They will typically micro-segment the market and devise different marketing and pricing strategies for each segment, by predicting the demand for each cruise/category of cabin at the micro-segment level and (broadly speaking) applying inventory and pricing controls. So it is entirely possible that prices for the same cabins could be going up in some markets and down in others. Cruise lines also need to adjust occupancy demand through similar measures, because they can't sell all the berths in all cabins, an extra variable airlines and hotels don't have.

 

There's plenty of literature online on this (see also yield management, which is inventory control focused, but often used synonymously), if you are really curious - it's fascinating stuff :) As an example, not allowing existing bookings to take advantage of price promotions, which are designed to stimulate new demand - this is segmenting by time of booking. Overbooking is also a common feature of RM systems, and is probably a reason for the occasional visits of the upgrade fairy. I suspect overbooking in cruises is more about the expected numbers of those who don't make final payment (given that some very large segments can get deposits back, as outlined above), rather than actual no-shows on the day, which is more common for airlines.

 

Thanks for an interesting post!

 

Sometimes I see a cruise price listed as

$379 - $123,469. Really...it happens.

 

Tells me that (just maybe) ALGORITHMS

are involved .... and they have 'gone wild'.

 

BTW, if you don't think algos are important ...check this out.

 

 

Bon Voyage.

 

:cool:

[justforkicks]

Thanks for an interesting post!

 

Sometimes I see a cruise price listed as

$379 - $123,469. Really...it happens.

 

Tells me that (just maybe) ALGORITHMS

are involved .... and they have 'gone wild'.

 

BTW, if you don't think algos are important ...check this out.

 

 

 

Bon Voyage.

 

:cool:

Great link! Well worth the 15 minutes to watch! thanks:eek:

[teajak]

Thanks I live in the US, but I'm pretty sure we lost 200 bucks. If you get a guarantee or can they talk you into something when on the phone that would cause you to lose the deposit if canceled? That might have happened last time.

Oh hold it I remember what happened! We were stupid, or not informed, your pick. We just assumed the deposit was not refunded and when final payment came we never made it but we never inquired about getting the deposit back. We just automatically thought it was not refunded. Now we know, thanks and YES I feel VERY embarrassed about this little story. Please don't laugh too hard, we lost 200 bucks that time.

No laughing at all.Lesson learned;)

[Desert Cruizers]

I booked both the March 19 NZ and April 10th Sydney to Honolulu for 2014, both cruises have gone up $200 to 400 since I booked in April. Trouble is, our March 19th sailing isn't getting many CC members.:(

[JAMESCC]

No laughing at all.Lesson learned;)

Thanks I appreciate that.

[Sparky74]

I booked both the March 19 NZ and April 10th Sydney to Honolulu for 2014, both cruises have gone up $200 to 400 since I booked in April. Trouble is, our March 19th sailing isn't getting many CC members.:(

 

I've been watching the price on South Pacific cruise on the Australian RCI website. We were 99% decided to take this cruise & almost ready to book when the price went up on Thursday night. Late on Friday I received a email announcing a WOW sale starting on Sunday.:eek:

 

So I think an impending "sale" causes prices to go up.:(