Single Occupancy surcharge on HAL

[cruisemom42]

I'm referring to the fully loaded food cost which is the total cost of the meal including food, prep, service, and cleanup. I should have been more specific. If you just look at the food part of the equation, the overall 2014 average is $15.15 per pax per day. That's weighted toward the mainstream lines because they have more berths in the total calculation.

 

The mainstream (also called mass market - but not by the industry) lines are: Carnival, Costa, Disney**, MSC, NCL, and RCI. (Don't argue. I got this straight from CLIA. ;) ) When you're looking at the food costs, these lines have more more passengers in the equation and wind up providing more of the overall weighting.

 

**- I was surprised to see Disney here, but I'm just reporting.

 

Excellent info; thanks for looking that up.

[Mekka]

I'm referring to the fully loaded food cost which is the total cost of the meal including food, prep, service, and cleanup. I should have been more specific. If you just look at the food part of the equation, the overall 2014 average is $15.15 per pax per day. That's weighted toward the mainstream lines because they have more berths in the total calculation.

 

The mainstream (also called mass market - but not by the industry) lines are: Carnival, Costa, Disney**, MSC, NCL, and RCI. (Don't argue. I got this straight from CLIA. ;) ) When you're looking at the food costs, these lines have more more passengers in the equation and wind up providing more of the overall weighting.

 

**- I was surprised to see Disney here, but I'm just reporting.

 

It is incorrect to look at "fully loaded" costs. You are confusing fixed vs. variable costs. The only relevant costs to this discussion are those which vary with type of passenger. HAL doesn't save any food prep costs, server costs, etc. when they have solos on board. These costs are fixed. They will have the same crew costs whether or not you travel alone. For the same reason, it is irrelevant to discuss fuel costs, ship maintenance, or capital costs in this context.

 

Perhaps if Brucemuzz is lurking out there he can shed some light on this. I suspect he would confirm that solo passengers are not very attractive to the cruise lines.

[Wendy-Europe]

On both HAL cruises we paid twice the price than sharing a double.

 

We are solo cruisers - but cruising together... (I agree: I would not have a problem to share a room with my wonderful travelcompanion - I did it before - but we both prefer to have our own cabin - nearby or with connecting door is fine.... much better for our friendship!)

 

I monitor cruises for years - and unfortunately HAL is not one of the cruiselines which lowered single supplement during low season.

Both times we booked HAL the regular double occ. price was more than fair so it was a good deal while paying twice the amount couples pay per person....

(I found it unfair, that I pay 200 %, but just get one beverage card and I had to struggle with the TA about the OBC they offered. It was announced per cabin - and they want to cut it to the half - but we found an agreement)

 

At other cruiselines we´ve got really good deals over the years (we always book balconies). Royal Carribean had good offers (but they changed their policy - now you get double loyality points when cruising solo - but their supplement increased - from 150 %(special offers) to 200 % now (special offers too).) NCL had sometimes special offers - book an inside, get a balcony - so the supplement is on the inside - and you end with a very reasonable price for the balcony. But fact is: NCL is one of the cruiselines which has a supplement of 200 % and above! (They have very often the fact, that you are able to book the lower priced balconies for 2 persons - but if you change the number of guest, these cabins are not bookable and you have to take a much more expensive cabin. So the suppl. rise to 250 % and above - which makes me furious!. A reason why I avoid NCL for years....

 

Wendy

[POA1]

It is incorrect to look at "fully loaded" costs. You are confusing fixed vs. variable costs. The only relevant costs to this discussion are those which vary with type of passenger. HAL doesn't save any food prep costs, server costs, etc. when they have solos on board. These costs are fixed. They will have the same crew costs whether or not you travel alone. For the same reason, it is irrelevant to discuss fuel costs, ship maintenance, or capital costs in this context.

 

Perhaps if Brucemuzz is lurking out there he can shed some light on this. I suspect he would confirm that solo passengers are not very attractive to the cruise lines.

 

I'm not confused at all. Fully loaded per person dining costs do not double for a single. They'd have to get two place settings, two glasses, and everything but the food for that to be true.

 

Thought experiment: There's a certain amount of breakage cost (glasses and such) on a cruise. For accounting purposes, it's an aggregate number. However, people who are not on the ship cannot break anything.

 

I used to work on the cost allocation systems for a large telecommunications company. most everything was a fixed cost. We were still able to calculate per minute costs for various customer types. Just because it's not simple or because it's not required for financials doesn't mean it doesn't matter.

[Mekka]

I have a Ph.D. In economics and teach these things for a living. If I had a dollar for every student who has made this mistake in confusing fixed and variable costs, I'd be quite wealthy. Fully loaded costs are used for some types of decisions, but not the kind in this discussion. When HAL is designing their new ship, they are central to the plan. When they are setting the price for a cabin, they are ignored.

 

Perhaps things would be more clear if you look at it from a different angle. Why do you think all the cruise lines charge a premium for singles? Is it a conspiracy? Are they trying to lose money on purpose? There is an obvious answer. I'm sorry it means some of you will pay a higher price.

 

I'm done with the economics lesson of the day. I wish you all fair seas and following winds.

[navybankerteacher]

On both HAL cruises we paid twice the price than sharing a double.

 

We are solo cruisers - but cruising together... (I agree: I would not have a problem to share a room with my wonderful travelcompanion - I did it before - but we both prefer to have our own cabin - nearby or with connecting door is fine.... much better for our friendship!)

 

I monitor cruises for years - and unfortunately HAL is not one of the cruiselines which lowered single supplement during low season.

Both times we booked HAL the regular double occ. price was more than fair so it was a good deal while paying twice the amount couples pay per person....

(I found it unfair, that I pay 200 %, but just get one beverage card and I had to struggle with the TA about the OBC they offered. It was announced per cabin - and they want to cut it to the half - but we found an agreement)

 

At other cruiselines we´ve got really good deals over the years (we always book balconies). Royal Carribean had good offers (but they changed their policy - now you get double loyality points when cruising solo - but their supplement increased - from 150 %(special offers) to 200 % now (special offers too).) NCL had sometimes special offers - book an inside, get a balcony - so the supplement is on the inside - and you end with a very reasonable price for the balcony. But fact is: NCL is one of the cruiselines which has a supplement of 200 % and above! (They have very often the fact, that you are able to book the lower priced balconies for 2 persons - but if you change the number of guest, these cabins are not bookable and you have to take a much more expensive cabin. So the suppl. rise to 250 % and above - which makes me furious!. A reason why I avoid NCL for years....

 

Wendy

If they run a single up to 250% (hard to believe), why don't you just book for two - then, on boarding day, explain that your good buddy had an emergency and could not make it.

 

Of course, at the end of the day, it should be value for money. When I was sailing solo I could have done better (cost-wise) on other lines - but what I received for what I paid - whether it was a low base fare and high supplement, or higher base fare with lower supplement (the difference is immaterial if the total dollar cost is the same) - is what mattered.

 

Bottom line is: why do people think cruise lines should be "fair" to singles? They are customers like everyone else, and the cruise line is interested in profit - not in leveling the playing field --- that falls within the province of progressive governments.

[runnergirl71]

Regarding booking for two people and then the second "not being able to make it", I don't know how it would work in general, but I know that with the group I will be sailing with, they offered the "match up" thing where they would try and match 2 solos to share a room, but if that other person wasn't able to come at any point even up to day of sailing, the remaining person would be responsible for the entire fare. Even if the other person didn't have insurance.

[sail7seas]

It might be fun to speculate about who spends more... solos or couples. I doubt any of you have any empirical basis for claiming one way or the other. But I can't believe anybody could seriously assert that solos spend more than twice as much per capita than passengers traveling as couples. That's what it would take for singles to be as profitable as couples. Do you really think that solos drink twice as much, gamble twice as much, take twice as many excursions??? That's ridiculous. When a solo goes on an excursion, he pays one price. A couple buys 2 tickets. That's simple math.

 

No wonder Holland prefers couples and prices their cabins accordingly. I sense a defensiveness and persecution complex in the comments by solos. Holland's pricing is no reflection on your worth as a human being. I'm sure you would like to get a better deal, but that's not being realistic. You simply aren't as attractive as customers and they would rather have 2 people in your cabin, even if you pay double. I know you don't want to hear this, but it's a straightforward business decision.

 

It's okay, you can believe it. Maybe not for all singles but definitely for some. RuthC made statements of sensible and logical reasoning why some singles (especially women) would spend more than you may think.

 

When I cruise next it will be my first time as a single. I lost my DH several months ago and I am far from ready to think of traveling without him now but I hope/believe the day will come when I do.

 

We always ordered nice wines. It is what I like and will continue to order the wines that we enjoy, overpriced as some claim them to be on HAL ships. Friends have invited me to join them for a cruise they booked for this winter. If I go, I will treat them all to these nice wines as a small thank you for including me in their plans.

 

I will shop the same as I always do.

I will tip the way we always did.

I will buy the same internet packages.

I will stay in the same cabin we always did.

I will have my pre dinner cocktail and after dinner drink, the same as always.

It is not impossible, my bill at cruise end will be the same as though still a couple.

 

Depending upon how bad the smoke in the casino, I might even play slot machines a little as there could be some 'down times' I may want to occupy with mindless entertainment.

 

You can believe there are exceptions to every rule. Lumping everyone as one rarely works well.

 

[Surreyman]

Solos don't have to spend as much as couples to be spending; they only have to be spending double the couple average. If you want to toss in the spending of kids who sail free, or at very reduced rates, the average is even lower.

 

Since we all read posts daily about couples doing walking tours on their own in ports, or booking private tours, we know HAL is making nothing on those people in those ports. We read all the time about couples bringing on bottles of wine to sip on their balcony; HAL makes at most the corkage fee on that. Solos are out in the lounges ordering drinks at a much higher cost, and booking HAL excursions.

We see posts all the time about how people leave the ship with little on-board expense. The spending bar for solos to reach is lower than you present, and not all that hard for a solo to reach.

 

I would love to see some current studies on how much couples spend on board vs. what solos spend. What I wonder is does HAL track this routinely, and act on the results. Or is HAL simply continuing to take solos for granted.

 

I would be very surprised if a cruise company did not analyse its customers spend in detail and knows exactly which customer types spend what on average and what the standard deviation of spend is as well.

 

There are various reasons why cruise ships are cash-free zones, but one of those reasons will be so they can track spend by customer type.

 

This information is very likely to inform pricing.

[SoCal Cruiser78]

I would be very surprised if a cruise company did not analyse its customers spend in detail and knows exactly which customer types spend what on average and what the standard deviation of spend is as well...

 

One poster here on CC stated that he had managed ships for a number of major lines, and that onboard spending is closely tracked.

 

I recall he said that for Alaska cruises, passengers departing from Seattle spend less than those departing from Vancouver. The difference appears to be that Seattle pax are largely U.S. citizens, with Vancouver passengers mainly non-U.S. He also said that Austrailian passengers spend the most per capita, if I recall correctly.

 

I don't recall any reference to the spending of solo travelers, though.

Edited July 3, 2014 by Ryndam2002

[POA1]

I have a Ph.D. In economics and teach these things for a living. If I had a dollar for every student who has made this mistake in confusing fixed and variable costs, I'd be quite wealthy. Fully loaded costs are used for some types of decisions, but not the kind in this discussion. When HAL is designing their new ship, they are central to the plan. When they are setting the price for a cabin, they are ignored.

 

Perhaps things would be more clear if you look at it from a different angle. Why do you think all the cruise lines charge a premium for singles? Is it a conspiracy? Are they trying to lose money on purpose? There is an obvious answer. I'm sorry it means some of you will pay a higher price.

 

I'm done with the economics lesson of the day. I wish you all fair seas and following winds.

 

Thank you, but I do understand the difference between fixed and variable costs. (Just because you claim a dollar doesn't mean you get one. :))

 

I also understand the need to be able to allocate the fixed costs across units of production in terms of calculating a profit, which was what I was posting about. I never stated that the cost had anything to do with setting cabin prices. I was talking about profit calculations. Are you saying that fully loaded costs don't matter in profit calculations? The "cabin price" thing is just a straw man argument. Here's the quote:

 

You have to credit the single traveler's side of the ledger with 100% profit for the missing food cost if they've paid double fare. That's a pretty hefty number.

 

While I did mention berths, it was only in the context of how the all-passenger food cost averages would tend to skew toward the low end of the market due to the large number of berths at that end.

 

You seem to be jumping to the conclusion that fully loaded costs don't apply profit calculations at the unit level, but it looks like you are explaining it away based on a pricing argument, which isn't really applicable.

 

If I has a dollar for every time an economist introduced a straw man fallacy into an argument.... ;)

[hrhdhd]

Just as we can't generalize that all couples spend more than all solos, we can't generalize that all solos spend more than all couples.

 

Do some solos spend more than some couples? Sure.

 

Do some couples spend more than some solos? Of course.

 

Arguing by anecdote is not helpful to determine spending habits overall.

[Surreyman]

I'm not confused at all. Fully loaded per person dining costs do not double for a single. They'd have to get two place settings, two glasses, and everything but the food for that to be true.

 

Thought experiment: There's a certain amount of breakage cost (glasses and such) on a cruise. For accounting purposes, it's an aggregate number. However, people who are not on the ship cannot break anything.

 

I used to work on the cost allocation systems for a large telecommunications company. most everything was a fixed cost. We were still able to calculate per minute costs for various customer types. Just because it's not simple or because it's not required for financials doesn't mean it doesn't matter.

 

Your cost per minute was not the true cost of the marginal minute that your customers used. It would have been no good to use that figure as the basis of a decision to run a marketing campaign design to increase usage.

 

Similarly with the cost of the marginal customer. Faced with the choice between a couple booking a cabin and a single booking the same cabin the savings won't be much more than the food cost. It will be higher for,say, breakages, but that won't amount to much on a per person basis, how many glasses does the average customer break.

 

 

Of the several thousand dollars the average customer spends on booking a cruise the overwhelming majority will be a contribution to fixed costs.

[cruisemom42]

Help! I've fallen into an economicoma and I can't wake up.

[navybankerteacher]

Help! I've fallen into an economicoma and I can't wake up.

 

Well put.

 

I think we should simply acknowledge that cruise lines might know better than their customers the economics of berth marketing; and even if they do not, the mistakes they make are theirs to make. At the same time, we can agree that life is not fair: either for people who travel alone and have to pay so much - or for those who have to put up with sharing a cabin to take advantage of the lower price available for those who do share.

[Kenito]

Originally Posted by cruz chic

 

Thanks for letting me know that is HAL decision to make. I had no idea.

 

I cannot imagine that the thought never occurred to you.

 

I apologize for coming into this particular exchange late, but what I have recently come to discover is that HAL can change the SS % just as they do the fare, throughout the booking period. Previously, I had assumed that they had a policy on single supplements, and that was their policy. Now I see that they can change it at will.

 

It has caused me and a friend who booth booked a cruise assuming a 200% SS, only to discover well into planning that it was not... resulting in an effective change of pp fare which will cost an extra $900 each. Not inconsequential.

 

That thought never occurred to me or my friend. We booked face to face, on a cruise, with a FCC and stated our intention to add another passenger. We were never advised that it was NOT 200%... surprise, surprise!

[POA1]

Your cost per minute was not the true cost of the marginal minute that your customers used. It would have been no good to use that figure as the basis of a decision to run a marketing campaign design to increase usage.

 

I'll let everyone know the work was for naught and that we wasted years of effort and a lot of resources. They'll be crushed, :( because it was considered ground breaking stuff. It was never part of marketing planning. It was a cost assignment exercise designed to provide business intelligence.

 

For the record, the marginal incremental cost of a single minute on a US long distance network is effectively zero. At the time of the calculations, long distance billing in the US and the UK were done in a much different way. There was much more per-call detail in our billing record systems than in BT's. It may still be that way today.

[Wendy-Europe]

If they run a single up to 250% (hard to believe), why don't you just book for two - then, on boarding day, explain that your good buddy had an emergency and could not make it.

 

 

Believe it or not ;-)

 

They "just" charge 200 % on the cabin - but they close cheaper subcategories for solo bookings, so that you need to book a BA instead of the cheaper BD.

 

If you check double occupancy you see, that a lot of BD are available.

 

Thats not the fact on all cruises - but they do. Others do it too. AIDA Cruises accept only a specific number of solo bookings per cruise. (and that is not a large number).

 

Sure - it is up to the Company to chose their clients. Sometimes they don´t want to have to many solo cruisers because they fear to be known as a "single cruising line". And thats something many couples avoid.

 

The secret is how to hold loyal customers, get new ones, make some changes , but do not frighten the loyal guests. Update your fleet, but don´t loose the identy.

 

Sometimes it is yield management - all companies do yield management today - the better they do, the better the profit! Sure they try to sell the cabins for a very high rate and then the prices fall when the travel date is getting closer. And the badest thing is an unsold cabin (or an unsold seat at an airplane).

And sometimes they can get what they want because the demand is high (maybe a routing, a special ship or whatever)

 

I am not angry about that - it is up to me to make my decision who gets my money.

 

And I am cruising since I am 20, at the moment once or twice a year and if a cruiseline treat me well I am more than willing to book....

 

It is a market - the seller has something to sell at a price he wants to have - the buyer want to buy something.

 

Sometimes both think it is a good deal and sometimes not.

 

There are many cruiselines and many ships to fill. I am not addicted to one company. And I am flexible in date and itinerary.

[mame42]

I usually cruise solo; however, earlier this year I booked an NCL cruise with a friend for badly needed R & R. We did our due diligence with our TA, and we thought we had handled the finances in the best way possible. For the sake of simplicity, since we live in different cities, I put the entire two person cruise fare for our balcony cabin on my credit card. Unfortunately, my friend was diagnosed with pneumonia the day before embarkation, and she could not make the trip.

 

Three days into the cruise, I received a letter in my cabin stating NCL was adding an additional $1100 to my account on top of the full two person fare that I had already paid, since only one person occupied the cabin. Needless to say, my TA fought back, and the charge was eventually dropped, but not without a significant amount of hassle and stress on both our parts.

[CowPrincess]

Just as we can't generalize that all couples spend more than all solos, we can't generalize that all solos spend more than all couples.

 

Do some solos spend more than some couples? Sure.

 

Do some couples spend more than some solos? Of course.

 

Arguing by anecdote is not helpful to determine spending habits overall.

 

And do some couples and some solos spend the same? Apparently, YES, I just checked my Mariner Days Spending Credits, and on my last cruise (which was solo) I got the same # of credits as my DH and I combined managed to acquire on our most recent cruise together. That was an eye-opener for me :D

[sail7seas]

And do some couples and some solos spend the same? Apparently, YES, I just checked my Mariner Days Spending Credits, and on my last cruise (which was solo) I got the same # of credits as my DH and I combined managed to acquire on our most recent cruise together. That was an eye-opener for me :D

 

 

 

That might be something you may wish to accidentally forget to mention to DH. :D

 

[SoCal Cruiser78]

...Three days into the cruise, I received a letter in my cabin stating NCL was adding an additional $1100 to my account on top of the full two person fare that I had already paid, since only one person occupied the cabin. Needless to say, my TA fought back, and the charge was eventually dropped, but not without a significant amount of hassle and stress on both our parts.

 

One thing to check carefully when buying cruise insurance. Some policies I have seen have a loophole regarding single supplements. If I understand them correctly, in your case they would refund your cabin mate's pp rate for illness, but not reimburse the additonal SS you were billed. Something to keep an eye out for!

Edited July 4, 2014 by Ryndam2002

[CowPrincess]

That might be something you may wish to accidentally forget to mention to DH. :D

 

 

He would just laugh :D (and that would not be "surprised" laughter :D )

[Kenito]

I usually cruise solo; however, earlier this year I booked an NCL cruise with a friend for badly needed R & R. We did our due diligence with our TA, and we thought we had handled the finances in the best way possible. For the sake of simplicity, since we live in different cities, I put the entire two person cruise fare for our balcony cabin on my credit card. Unfortunately, my friend was diagnosed with pneumonia the day before embarkation, and she could not make the trip.

 

Three days into the cruise, I received a letter in my cabin stating NCL was adding an additional $1100 to my account on top of the full two person fare that I had already paid, since only one person occupied the cabin. Needless to say, my TA fought back, and the charge was eventually dropped, but not without a significant amount of hassle and stress on both our parts.

 

This sort of thing drives me to distraction. You paid for two, but they wanted to add $1,000 because only one actually occupied the cabin? :confused:

 

I presume if both of you didn't show up you would have been charged an additional $2,000?

 

[Kenito]

Originally Posted by mame42 View Post

...Three days into the cruise, I received a letter in my cabin stating NCL was adding an additional $1100 to my account on top of the full two person fare that I had already paid, since only one person occupied the cabin. Needless to say, my TA fought back, and the charge was eventually dropped, but not without a significant amount of hassle and stress on both our parts.

One thing to check carefully when buying cruise insurance. Some policies I have seen have a loophole regarding single supplements. If I understand them correctly, in your case they would refund your cabin mate's pp rate for illness, but not reimburse the additonal SS you were billed. Something to keep an eye out for!

 

 

This makes more sense, but the OP didn't mention insurance or refunds.