An Open Letter To Mr Del Rio.

[maxwellito]

I hope you wrote to him directly

Big corporate execs have people who read their emails and address them

[Merriem]

I hope you wrote to him directly

Big corporate execs have people who read their emails and address them

 

I wrote to him on our first Oceania cruise. Just got a snippy response from an employee. I hope this man reads what people have to say. We have cruised about 40 times, and NEVER paid for room service.

Edited March 31, 2015 by Merriem

[chengkp75]

I'll post my views, probably lurk to see other views, but don't intend to get into a debate over this here on CC, as I don't think a debate is worth the time.

 

Mr. Del Rio was chosen from a smaller, absorbed, subsidiary to become the CEO of the parent company, over promoting someone from the parent company, so that shows where the board of director's thought process was on the future of the company.

 

The cruise industry is a service industry, and customer service should be paramount, but given today's business models, most cruise lines (and business in general) look to shareholder profit as their first priority (which is totally understandable, and a good thing for the longevity of the company, but should be a balance). But things change. Markets change, demographics change, economies change. Business has to change to meet the demand. If the cruise industry had kept the old liner services of nightly shoe shining, the cabin steward setting out your clothes daily and brushing and ironing them, 12 course meals, etc. would cruising be affordable to the general public as it is now?

 

Whether Mr. Del Rio's moves are found to be counter-productive, or found to be the wave of the future for mainstream cruise lines remains to be seen. I'm not saying he is the messiah of the industry, but he may be just slightly ahead of the curve. Look at the Carnival and RCI boards, and see how many threads claim cutbacks in service, and you may see why Del Rio is keeping the service, but charging for it.

 

Apollo management isn't stupid. They control billions of dollars in capital, and don't make a business of losing money. They do their homework. If they thought this might adversely affect the company's profitability, would they have chosen Mr. Del Rio?

 

I personally feel that given the ever tightening regulatory environment of the maritime industry, and the continued economy where the majority of people have less disposable income than in the past, that you will see more and more pay as you go services on every cruise line, to keep the base fare as low as possible.

 

JMHO.

[chengkp75]

I think sometime these CEO make so much money they have a hard time connecting with their core customers. They only care about huge profits and making a name for themselves on Wall Street. They think the customer will remain loyal no matter what changes they make. I think Mr. Del Rio should take a que from the former CEO of JC Penney's. He insisted his way of everyday low prices and not having sales was the way to go. He was going to be Penney's savior. I didn't agree and refused to shop there (as did many other customers). Now they went back to their former model of sales every week but I got out of the habit of shopping their stores so it's not the first place I head for my shopping. I used to be a loyal Penney's shopper. This could be the nudge loyal customers need to explore other cruiselines. They might find the grass IS greener on the other side. Just booked an Escape cruise for 2016 and was considering a 2017 also. Will wait and see what happens and then consider my options. Lots of good options with other cruiselines.

 

I find it interesting that everyone assumes that the cruise lines are making huge profits. I was on a thread over on RCI about profit per passenger, which according to their SEC filings is $148/passenger. That's not per passenger per day, that's per passenger booked. So, of your several thousand dollar cruise, they make $148. We figured over there, that RCI was getting a 9% return on investment. Is that a huge profit? And I can assume that the other lines are getting roughly the same, given they are all pricing similarly and still sailing full and still in business.

 

Now, whether CEO compensation is out of hand is another topic for discussion, but is not limited to cruising.

Edited March 31, 2015 by chengkp75

[backsbanny]

cruiselines make millions of profits just check their latest financial results you can find them through the web

[chengkp75]

cruiselines make millions of profits just check their latest financial results you can find them through the web

 

I'm not saying they don't make millions in profits. But that is due to the scale of their operations, which also require hundreds of millions of expenses to make that profit. However, any business person will not look at gross profits, but at rate of return on investment. If I can make 10% on my millions investing in the stock market, or 12% making widgets, while I can only make 9% on cruise lines, why should I invest my money, or why should I stay in the cruise business. Maersk lines (AP Moller Group) is one of the largest shipping companies in the world. They are virtually privately owned by the Moller family. A few years back, Maersk-McKinney Moller asked his board of directors why he should not pull the plug on the whole company when he could make more money in the stock market. Yet the company was making millions of dollars each year.

[www3traveler]

Chengkp75,

I was not going to get into this discussion either until I read your comments.

 

As stockholder, of the Company I applaud Mr. Del Rio and his efforts to improve the bottom line of the Company. At this moment, this Company is carrying a tremendous debt load: costs of 6 new ships (Epic, Breakaway, Getaway, Escape, Bliss plus 2 unnamed, the purchase of two companies), cost of going public. The everyday costs go up: fuel, insurance, provisions, government fees, not just US fees. Something had to give.

 

I will continue to support this Company and efforts to restore Her to financial health. I had to restore my own financial health, and I applaud Mr. Del Rio's efforts.

[backsbanny]

i dot know whether you will applaud i two or three years from now though

[NEW 2 CRUISIN]

I wonder what the dress code is at 3 am when I get thirsty...hope it's sleep-casual!

 

OK.....I just literally laughed out loud!

Thanks for the morning chuckle, CAROLINA!

 

I'm going to work "sleep-casual" in to one of my conversations today! HAHA!

 

:D

[mizLORInj]

I do think it's disappointing to see some of the changes. That is a steep charge for room service, and I think maybe they are trying to discourage its use?

 

Not sure whether Del Rio will turn out to be what would be considered a "good" CEO yet. Or whether good for NCL or good for the customer at least. Kevin Sheehan did seem to make NCL a product that people loved.

 

Change is a part of life and through our 13 years of cruising we have seen many cutbacks on various cruiselines. We will adjust to these changes too, but that doesn't mean we like them (or any other cutbacks!), and we do have choices of other cruiselines as well. All cruiselines need to realize that fact.

 

I am just back from the Gem on 3/27 (posted a review if you search) and when I filled out my online survey from NCL yesterday, it asked if I was familiar with a site called cruise critic, and also if I read and wrote reviews there. So NCL is quite aware of CC, which is a good thing for the most part, and NCL has even responded to various threads. So maybe they will read this one as well.

Edited March 31, 2015 by mizlorinj

[punkincc]

Good letter. This is going to be a tipping point for NCL under it's new leadership. If NCL backs off of this new fee and apologizes, they may be able to save themselves. If they decide to go full steam ahead despite the massive outpouring of outrage on both this site and their facebook page, then I think they're going down. I really do miss Kevin Sheehan, he was a great CEO and really knew how to treat his customers. It's a shame that the new administration is so short-sighted. This may increase NCL's profit margin in the extreme short run, but it's going to disgust enough of us and turn enough of us away that I think i will hurt them a lot in the long run.

 

I agree completely. Loyalty is a very difficult, maybe impossible thing to get back once you've lost it. Huge NCL cheerleader in the past, but trust and loyalty are fast fading.

 

I can completely understand FDR's desire to increase the amount that passengers spend on board as that is where the real profit comes from. And I understand that the difference between profit and loss on a particular sailing can be very thin. But I think they are going about it in the worst possible way.

 

When FDR made his statements in an interview about the need to squeeze, I believe $54 additional out of every passenger, it really rubbed me, and I suspect many others, the wrong way. He came off sounding like a pompous arse, and he totally lost me at that point.

 

If NCL wants me to spend more money on board, then ENTICE me to do it, don't just raise the prices of everything on board and add "convenience" fees to anything that moves. (And while you are doing it, make sure you handle the presentation of these changes in the WORST possible way, pi**ing off everyone in the process even more.) Nothing worse for a company than righteous outrage. Terms like NCL = No Cash Left are going to haunt them for years.

 

As I said, "entise" me to spend more with some innovative ideas, like NCL did ( probably Kevin Sheehan to thank ) with the concept of a for fee dinner show ala Cirque, Imaginarium, etc. I fell for it hook line and sinker, and considered it a wonderfull "option". Or the ICE Bar. How about opening up a couple of those empty specialty restaurants for lunch or breakfast with a reduced cover fee. Lots of people would be interested, including me. Lots of ideas out there without having to resort to the current tactics.

[emcelh]

I agree completely. Loyalty is a very difficult, maybe impossible thing to get back once you've lost it. Huge NCL cheerleader in the past, but trust and loyalty are fast fading.

 

I can completely understand FDR's desire to increase the amount that passengers spend on board as that is where the real profit comes from. And I understand that the difference between profit and loss on a particular sailing can be very thin. But I think they are going about it in the worst possible way.

 

When FDR made his statements in an interview about the need to squeeze, I believe $54 additional out of every passenger, it really rubbed me, and I suspect many others, the wrong way. He came off sounding like a pompous arse, and he totally lost me at that point.

 

If NCL wants me to spend more money on board, then ENTICE me to do it, don't just raise the prices of everything on board and add "convenience" fees to anything that moves. (And while you are doing it, make sure you handle the presentation of these changes in the WORST possible way, pi**ing off everyone in the process even more.) Nothing worse for a company than righteous outrage. Terms like NCL = No Cash Left are going to haunt them for years.

 

As I said, "entise" me to spend more with some innovative ideas, like NCL did ( probably Kevin Sheehan to thank ) with the concept of a for fee dinner show ala Cirque, Imaginarium, etc. I fell for it hook line and sinker, and considered it a wonderfull "option". Or the ICE Bar. How about opening up a couple of those empty specialty restaurants for lunch or breakfast with a reduced cover fee. Lots of people would be interested, including me. Lots of ideas out there without having to resort to the current tactics.

 

I remember something in that interview about getting people to choose one of his ships over the competition. I wouldn't this this is the way to do it. They're going to have to provide a superior product and keep the base fare very low so that, when all the extras are factored in, it's still the best value.

[AKR2011]

I am one of those budget cruisers, and I'm not afraid to admit it. The husband and I work incredibly hard but don't make a lot of money. However, a vacation is something that we budget for. We chose NCL for our honeymoon after looking at many factors, including cost and value. NCL was the best choice. Now I'm afraid that we won't be able to afford the cruises anymore after our next one. We're not huge drinkers, and the UBP is unavailable as a promo on our upcoming cruise. However, I feel like I have to buy it with the 14% increase in beverages. It may not be worth it to buy individual drinks along with the soda package that we usually get. We don't need to eat in specialty restaurants every night, but trips to Le Bistro and Cagney's each cruise have become a special tradition for us. Now that's more too. I love the staff, but I always add an extra tip to my favorite bartenders and give cash to other staff. Now I'm also being forced to tip18% and pay more each day? In two weeks, that's almost an extra $30 for the eh and myself by itself. We have never ordered room service, but I can understand why people are upset by this new cost as well. I just wonder what's next. I have no problem with the "Ship Within a Ship" concept, as those who want the suite life seem fine with paying for it. But I think NCL is forgetting the little people like us. People who work incredibly hard for their vacation. There are a lot of others just like me. I wish they would remember that. The economy may be looking up, but not that much. I am one of the "NCL Cheerleaders" as people call them in this forum. Everyone I know is tired of hearing my praises and love for the cruise life. I really hope things go back to the way they were soon. It wasn't a broken system. We're NCL passengers, not luxury ones, and it's simply because as average people, we simply can't afford it. I'm afraid of being pushed away because of that.

[Cruiseisle]

Good letter. This is going to be a tipping point for NCL under it's new leadership. If NCL backs off of this new fee and apologizes, they may be able to save themselves. If they decide to go full steam ahead despite the massive outpouring of outrage on both this site and their facebook page, then I think they're going down. I really do miss Kevin Sheehan, he was a great CEO and really knew how to treat his customers. It's a shame that the new administration is so short-sighted. This may increase NCL's profit margin in the extreme short run, but it's going to disgust enough of us and turn enough of us away that I think i will hurt them a lot in the long run.

 

It always gets you "in the long run"!

How disappointing NCL!

[Cruiseisle]

OK: here is my read on all of this posts on this CEO.

We have many options and if NCL continues to raise prices and wants to become the next new high priced line; so be it.

I have NO problem cancelling all of our high priced suite cruises. Not a threat; just reality.

There is so much competition that we will cancel and switch.

When this CEO can provide the level of food served on X Aqua Class (non suite); the pools on RCC in a solarium; and the suite level of service on Princess, I will stay.

If DH and I continue to get squeezed and he wants $50.00 more, say that and leave everything else alone.

Otherwise, enjoy our suites; they will be available!

It seems every day I check in here there is another upcharge.

Will monitor and cancel when needed.

A "leader" can make or break an organization in a very short period of time. I will see for us.

 

I recall reading that article about raising cruise prices a mere $50.

I agree with your point: "If DH and I continue to get squeezed and he wants $50.00 more, say that and leave everything else alone."

[Cruiseisle]

I'll post my views, probably lurk to see other views, but don't intend to get into a debate over this here on CC, as I don't think a debate is worth the time.

 

Mr. Del Rio was chosen from a smaller, absorbed, subsidiary to become the CEO of the parent company, over promoting someone from the parent company, so that shows where the board of director's thought process was on the future of the company.

 

The cruise industry is a service industry, and customer service should be paramount, but given today's business models, most cruise lines (and business in general) look to shareholder profit as their first priority (which is totally understandable, and a good thing for the longevity of the company, but should be a balance). But things change. Markets change, demographics change, economies change. Business has to change to meet the demand. If the cruise industry had kept the old liner services of nightly shoe shining, the cabin steward setting out your clothes daily and brushing and ironing them, 12 course meals, etc. would cruising be affordable to the general public as it is now?

 

Whether Mr. Del Rio's moves are found to be counter-productive, or found to be the wave of the future for mainstream cruise lines remains to be seen. I'm not saying he is the messiah of the industry, but he may be just slightly ahead of the curve. Look at the Carnival and RCI boards, and see how many threads claim cutbacks in service, and you may see why Del Rio is keeping the service, but charging for it.

 

Apollo management isn't stupid. They control billions of dollars in capital, and don't make a business of losing money. They do their homework. If they thought this might adversely affect the company's profitability, would they have chosen Mr. Del Rio?

 

I personally feel that given the ever tightening regulatory environment of the maritime industry, and the continued economy where the majority of people have less disposable income than in the past, that you will see more and more pay as you go services on every cruise line, to keep the base fare as low as possible.

 

JMHO.

 

 

Then perhaps Apollo Management should have "personal touch points" with the ultimate consumer and get their thoughts!

Am I missing something ... Was something broken here?

Do the loyal customers not mean anything?

[SteveH2508]

I agree completely. Loyalty is a very difficult, maybe impossible thing to get back once you've lost it. Huge NCL cheerleader in the past, but trust and loyalty are fast fading.

 

I can completely understand FDR's desire to increase the amount that passengers spend on board as that is where the real profit comes from. And I understand that the difference between profit and loss on a particular sailing can be very thin. But I think they are going about it in the worst possible way.

 

When FDR made his statements in an interview about the need to squeeze, I believe $54 additional out of every passenger, it really rubbed me, and I suspect many others, the wrong way. He came off sounding like a pompous arse, and he totally lost me at that point.

 

If NCL wants me to spend more money on board, then ENTICE me to do it, don't just raise the prices of everything on board and add "convenience" fees to anything that moves. (And while you are doing it, make sure you handle the presentation of these changes in the WORST possible way, pi**ing off everyone in the process even more.) Nothing worse for a company than righteous outrage. Terms like NCL = No Cash Left are going to haunt them for years.

 

As I said, "entise" me to spend more with some innovative ideas, like NCL did ( probably Kevin Sheehan to thank ) with the concept of a for fee dinner show ala Cirque, Imaginarium, etc. I fell for it hook line and sinker, and considered it a wonderfull "option". Or the ICE Bar. How about opening up a couple of those empty specialty restaurants for lunch or breakfast with a reduced cover fee. Lots of people would be interested, including me. Lots of ideas out there without having to resort to the current tactics.

 

I agree with this.

 

This FDR character seems to have got the concept of customer loyalty etc. arse backwards. In the space of a month he has turned us from 'NCL is first choice' to 'NCL is last or not a choice'. They have lost our loyalty and trust with a few chiselling penny-ante changes whose introductions were generally managed disgracefully.

 

NCL's loss will probably be Princess's or P&O's gain in our case.

Edited March 31, 2015 by SteveH2508

[chengkp75]

I agree with this.

 

This FDR character seems to have got the concept of customer loyalty etc. arse backwards. In the space of a month he has turned us from 'NCL is first choice' to 'NCL is last or not a choice'. They have lost our loyalty and trust with a few chiselling penny-ante changes whose introductions were generally managed disgracefully.

 

NCL's loss will probably be Princess's or P&O's gain in our case.

 

One note to remember, with all the talk of bloodletting at NCL, and FDR's running roughshod, is that Andy Stuart, a 27 year NCL executive, is still President and COO of NCL (as opposed to NCLH where FDR is). If this was thought to be so detrimental to NCL's core customer, would a longtime senior executive like Stuart, who was also Sheehan's right hand as EVP of Global Sales and Customer Services, stick around to see his work dismantled? Just saying.

[SteveH2508]

One note to remember, with all the talk of bloodletting at NCL, and FDR's running roughshod, is that Andy Stuart, a 27 year NCL executive, is still President and COO of NCL (as opposed to NCLH where FDR is). If this was thought to be so detrimental to NCL's core customer, would a longtime senior executive like Stuart, who was also Sheehan's right hand as EVP of Global Sales and Customer Services, stick around to see his work dismantled? Just saying.

 

A few possible scenarios. (I'm not a business analyst BTW)

 

1. Rank was pulled. AS does not like what is being done - either planning his exit strategy or waiting for the 'I told you so' moment.

 

2. AS has 'gone over to the dark side' - KS is history so he needs to keep in with the 'new broom'.

 

3. They have 'sold the farm' with giving out all of these UBP/UDP promotions and are desperate to get the revenue stream up to cover them.

[rvsullivan]

One note to remember, with all the talk of bloodletting at NCL, and FDR's running roughshod, is that Andy Stuart, a 27 year NCL executive, is still President and COO of NCL (as opposed to NCLH where FDR is). If this was thought to be so detrimental to NCL's core customer, would a longtime senior executive like Stuart, who was also Sheehan's right hand as EVP of Global Sales and Customer Services, stick around to see his work dismantled? Just saying.

 

You of course, are talking common sense. Many don't want to hear that I think. Many/most think Andy is the best and has been here for a very long time. It is he that is implementing the changes within NCL. He may be receiving guidance from above, but it is he that is running the company. I'm sure he is being given goals and financial figures that must be met. He had to have been briefed on what they wanted from him before he was promoted and seems to have agreed with how it should be implemented.

Some keep mentioning the "bloodbath" that FDR has implemented. There have been staff, including executive staff let go for all of the branches of the company. Every buyout, takeover or merger I've been involved in over the past 40-50 years has been handled the same way. Redundancy has been eliminated, and not just from one company. I think Kevin was given a choice, the new way or the highway. He made a choice. Andy had the same choice, he seems to be going along.

[hondorner]

There is one additional possibility -- FDR is keeping hands off, and letting Andy Stuart have the lead, and AS is finally getting to do all the things he had bottled up under Sheehan.

 

Do I really think that? Heck, I don't know any more than the rest of you who are making bad mouth about FDR. But, FDR's responsibilities lie with overall policy for 3 cruise lines, while Andy Stuart is directly responsible for happenings within NCL. I doubt FDR is making these tiny local decisions.

Edited March 31, 2015 by hondorner

[princess di44]

Shore excursions have increased through Ncl too. All 3 of the excursions I booked last week have went up, between 6 to 20 buks extra per person per excursion......