Congrats to NCL, you have innovated again!

[pokerpro5]

NCL, the inventor of Freestyle Cruising, has done something that is likely to be noticed soon by other cruise lines.

 

Their 2015 pricing model has been a smashing success, and has changed the way cruise inventory is sold.

 

I knew it would be successful, but I had no idea it would be THIS successful.

 

Basically, NCL has found a way to sell most of their staterooms early, and get people to pay high prices for them. Last minute and "14-55 day" bargains are now difficult to come by, especially for non-inside cabins.

 

After the laughable "all inclusive" disaster of 2014, NCL retooled the concept into the now-familiar "Choose Your Included Item" promotion of 2015.

 

NCL has also made it much cheaper to stuff additional people in your stateroom. Before, this would carry a nonsensically high price -- often more than it would be to buy these people their own inside cabin! Now you can add people for either half price or frequently just NCF+taxes.

 

At the same time, rates are much closer to the dreaded "brochure rates", and the prices are staying pretty constant. Rooms are selling out before any "dumping" becomes necessary on most sailings.

 

For example, look at the two Boston sailings on the Dawn this September. One (Sept 25) is COMPLETELY SOLD OUT, while September 11th has no more balcony rooms left. And we're only in April! WOW!

 

So what's the big innovation?

 

NCL has finally found a way to avoid the industry-wide practice of dumping rooms in the inside/oceanview/balcony categories.

 

They have accomplished this by decreasing revenue for:

 

- Specialty restaurants

- Beverage package

- Shore excursions

- DSC

- Additional people in stateroom

 

And while they give some of the above for free/cheap, this has enabled a much higher price point for the cruise fare, especially for the rooms which used to sell super-cheap.

 

This goes completely against the longstanding price model of cruising, where you pay relatively little, get no extras included, and charge onboard the things that you find you want/need which are not included. In fact, at the lower category rooms, the base fare was seen as a loss leader. Not anymore.

 

This was brilliant, as the "inclusions" don't cost them that much, and yet they make far more with the higher cruise fares they are now charging (and the avoidance of dumped rooms).

 

For example, the Ultimate Beverage Package costs them relatively little per customer, but they charge a lot for it. So now people get it for free on this promotion (if they choose that option), but many of them otherwise wouldn't have bought it anyway. And yet all of these people are paying substantially more in cruise fare, and believe they're getting a great deal because of what the UBP normally costs.

 

This situation, of course, is bad for the price-conscious NCL consumer. But it's great for NCL.

 

In an interesting twist, those with casino "free cruise" certificates (well, actually "free" means taxes+NCF) are now getting a lot more value, because base fare is so much more these days, and you're not likely to find many last minute bargains anymore.

 

The cruise I just booked would have been $4100 for the balcony stateroom I got, and I paid like $670 for taxes+NCF for 2.

Edited April 14, 2015 by pokerpro5

[maywell]

Its Carnival's Early-Saver / Royal Caribbean 'not-lowering cruise prices even last minutes'; just perfected by NCL with low prices with or without the promos. The others did it 1st, NCL did it 'better'or should I say Del Rio did it 'better' by pushing that 'lever' knowing people love cheap fares with the bells & whistles....

[sparks1093]

It will work with some but it didn't and won't work for me. The cruise I booked for October 2016 was $800 less with the competition than what NCL offered.

 

Oceania has been doing this for years- offering all kinds of "free" stuff to lure people onboard.

 

I am not going to be lured by being given things that I wouldn't buy anyway.

[Son of a son of a ...]

I hope someone writes as many words for my obituary :)

[eroller]

This was good for a laugh this morning.

[maywell]

I hope someone writes as many words for my obituary :)

 

Mines will be super short - I lived, I blinked and it was over. ;)

[footballbabe3]

I agree I also wonder if this means the cruises are going to be even more crowded and even more people drinking more then usual. ( turning it into a more party ship like Carnival)?? Just wondering

[Annmeat]

For whom was the AI a disaster? We are paying 2,475 dollars LESS for our June Getaway suite than we would if we booked today or during any of these new promos.

 

We are paying less than if we had. 2 connecting balconies, which is what we originally booked, as I contend that Getaway is so much fun that one does not need a suite...

So the AI has been a Non disaster for this family!

 

 

Also, our cruise for 2016 booked under the promo March is a pretty suite sweet deal as well- gratuities, UDP! UBP, etc- while I wouldn't buy UBP, we will still

Save many bucks just on our family of5 drinks alone.

 

 

Ann

[pokerpro5]

I agree I also wonder if this means the cruises are going to be even more crowded and even more people drinking more then usual. ( turning it into a more party ship like Carnival)?? Just wondering

 

That's a good point.

 

As a result of these "freebies", we are likely to see:

 

- More drunk people onboard

 

- More people in general, as it's a lot cheaper to cram extra people into your staterooms

 

- More difficulty getting specialty restaurant reservations

 

Please, please, give me 2014 NCL back!

[mlsetc]

NCL, the inventor of Freestyle Cruising, has done something that is likely to be noticed soon by other cruise lines.

 

Their 2015 pricing model has been a smashing success, and has changed the way cruise inventory is sold.

 

I knew it would be successful, but I had no idea it would be THIS successful.

 

Basically, NCL has found a way to sell most of their staterooms early, and get people to pay high prices for them. Last minute and "14-55 day" bargains are now difficult to come by, especially for non-inside cabins.

 

After the laughable "all inclusive" disaster of 2014, NCL retooled the concept into the now-familiar "Choose Your Included Item" promotion of 2015.

 

NCL has also made it much cheaper to stuff additional people in your stateroom. Before, this would carry a nonsensically high price -- often more than it would be to buy these people their own inside cabin! Now you can add people for either half price or frequently just NCF+taxes.

 

At the same time, rates are much closer to the dreaded "brochure rates", and the prices are staying pretty constant. Rooms are selling out before any "dumping" becomes necessary on most sailings.

 

For example, look at the two Boston sailings on the Dawn this September. One (Sept 25) is COMPLETELY SOLD OUT, while September 11th has no more balcony rooms left. And we're only in April! WOW!

 

So what's the big innovation?

 

NCL has finally found a way to avoid the industry-wide practice of dumping rooms in the inside/oceanview/balcony categories.

 

They have accomplished this by decreasing revenue for:

 

- Specialty restaurants

- Beverage package

- Shore excursions

- DSC

- Additional people in stateroom

 

And while they give some of the above for free/cheap, this has enabled a much higher price point for the cruise fare, especially for the rooms which used to sell super-cheap.

 

This goes completely against the longstanding price model of cruising, where you pay relatively little, get no extras included, and charge onboard the things that you find you want/need which are not included. In fact, at the lower category rooms, the base fare was seen as a loss leader. Not anymore.

 

This was brilliant, as the "inclusions" don't cost them that much, and yet they make far more with the higher cruise fares they are now charging (and the avoidance of dumped rooms).

 

For example, the Ultimate Beverage Package costs them relatively little per customer, but they charge a lot for it. So now people get it for free on this promotion (if they choose that option), but many of them otherwise wouldn't have bought it anyway. And yet all of these people are paying substantially more in cruise fare, and believe they're getting a great deal because of what the UBP normally costs.

 

This situation, of course, is bad for the price-conscious NCL consumer. But it's great for NCL.

 

In an interesting twist, those with casino "free cruise" certificates (well, actually "free" means taxes+NCF) are now getting a lot more value, because base fare is so much more these days, and you're not likely to find many last minute bargains anymore.

 

The cruise I just booked would have been $4100 for the balcony stateroom I got, and I paid like $670 for taxes+NCF for 2.

 

 

Wow, you said a mouthful. NCL is not in business to save rooms for people who might cruise at the last minute.

[watchdiva]

If in fact this is a "new business model" as the OP asserts, time will tell if it will be successful. I for one am very happy with the price points on my 3 booked cruises (all suites)..and will continue to cruise NCL until it no longer provides the experience that we are looking for. For 2017 a European river cruise is on our radar.

[hypercafe]

I have no problem with the price of regular rooms up to a mini suite. The Haven seems to be overpriced IMO. I can go on a real luxury line for similar dollars.

[hawkeyetlse]

NCL has also made it much cheaper to stuff additional people in your stateroom. Before, this would carry a nonsensically high price -- often more than it would be to buy these people their own inside cabin! Now you can add people for either half price or frequently just NCF+taxes.

As you explained in your other thread about pricing, the NCF is part of the advertised cruise fare. With KSF, the cruise fare is $0, and those passengers (3-8) pay the same government fees and taxes as guests 1 & 2, and that's it. So I'm not sure why you say "NCF + taxes".

NCL has finally found a way to avoid the industry-wide practice of dumping rooms in the inside/oceanview/balcony categories.

How does your argument extend to insides, since the FS Choice promo does not offer good incentives for booking those?

[cruisencrazy]

We sailed on the Epic in early March, last minute (booked one week prior), in a mini suite with the unlimited beverages for a nice price. We had a great time and though the ship was full, the only place you noticed it, was at the pool. Didn't see any rowdy drunk people at all, and we bar hopped quite a bit. We are also not big drinkers, but enjoyed trying different kinds of drinks. We loved it so much that we booked the Haven for the Med in May and have had no trouble with booking dinner reservations or shore excursions. We went on Royal Caribbean Oasis in December and would say that NCL is doing a much better job of providing a wonderful cruise experience. Don't knock it until you try it. Washy washy :)

[cliffd64]

I agree I also wonder if this means the cruises are going to be even more crowded and even more people drinking more then usual. ( turning it into a more party ship like Carnival)?? Just wondering

 

Seeing as how there are so many posts with people claiming they won't choose the UBP because they don't drink that much, I would say not. It seems like some people prefer getting OBC or their daily service charges paid over the other promos.

Edited April 14, 2015 by cliffd64

[DreamingBig1]

Your post is funny. Actually I disagree with the premise. I don't find that NCL is more expensive than competitors. I run the numbers occasionally and it doesn't seem that way to me.

 

Here's the thing.. no matter what line you will pay less for the older ships and more for the newer ships.

 

NCL has real steals on their older ships.

 

The beverage package is actually a good deal, as I don't see a difference between the prices with other lines and NCL for the same thing. A beverage package costs almost $800 for two people. On RCI it may be more for the beverage package.

[Kingofwylietx]

Seeing as how there are so many posts with people claiming they won't choose the UBP because they don't drink that much, I would say not. It seems like some people prefer getting OBC or their daily service charges paid over the other promos.

 

With the UBP, I may have an extra drink. However, I'm not going to get smashed and have to deal with a headache the next day just because I can drink for free. It's the same with a buffet...people generally get their normal fill and move on....but there will always be a few that overdo it (and they would probably overdo it if they were paying for it, so no real change).

[NEW 2 CRUISIN]

The people already turned off by NCL's new "pricing model" and "freebie" marketing are most likely not reading these boards any more, but following their new cruise line of choice in stead.

 

Will be hard for the rest of us to get the other opinions of NCL's strategy as a result.

 

:(

Edited April 14, 2015 by NEW 2 CRUISIN

[Mistizoom]

Seeing as how there are so many posts with people claiming they won't choose the UBP because they don't drink that much, I would say not. It seems like some people prefer getting OBC or their daily service charges paid over the other promos.

 

That's me. I picked free gratuities because $181 cash is worth more than any amount of drinks I would get or specialty restaurants I would eat in. We got third passenger 1/2 off since we are sailing during spring break. According to a price tracking website I use, the cost of my fare for a minisuite is the lowest it has been since the fares have been offered, while balconies on the same sailing are quite high (and hardly any cheaper than the minisuite). I'm happy with the price I got (didn't book through NCL so I got a discount on published fare that way as well), but of course I will keep tracking for price drops until final payment.

[sparks1093]

The people already turned off by NCL's new "pricing model" and "freebie" marketing are most likely not reading these boards any more, but following their new cruise line of choice in stead.

 

Will be hard for the rest of us to get the other opinions of NCL's strategy as a result.

 

:(

 

Everything about Del Rio and his strategy turns me off but I still have a cruise booked with NCL and will still consider booking with them in the future. But as I have said several times they will have to entice me onboard with price alone.

[WMQueenie]

The 1/2 price off 3rd and 4th passengers didn't work for me - I had started a thread on this subject last week - http://boards.cruisecritic.com/showthread.php?t=2194407

I recently did a comparison for the end of June, 7 night NCL vs. 8 night on Carnival from New York and the price difference was $841 less for a family of four and $700 less on Carnival. Don't think I could drink that much to make up for the price difference. We've sailed both and I like both...it all comes down to $$$$$.

[hondorner]

NCL, the inventor of Freestyle Cruising, has done something that is likely to be noticed soon by other cruise lines.

 

Their 2015 pricing model has been a smashing success, and has changed the way cruise inventory is sold.

 

I knew it would be successful, but I had no idea it would be THIS successful.

 

Basically, NCL has found a way to sell most of their staterooms early, and get people to pay high prices for them. Last minute and "14-55 day" bargains are now difficult to come by, especially for non-inside cabins.

 

After the laughable "all inclusive" disaster of 2014, NCL retooled the concept into the now-familiar "Choose Your Included Item" promotion of 2015.

 

NCL has also made it much cheaper to stuff additional people in your stateroom. Before, this would carry a nonsensically high price -- often more than it would be to buy these people their own inside cabin! Now you can add people for either half price or frequently just NCF+taxes.

 

At the same time, rates are much closer to the dreaded "brochure rates", and the prices are staying pretty constant. Rooms are selling out before any "dumping" becomes necessary on most sailings.

 

For example, look at the two Boston sailings on the Dawn this September. One (Sept 25) is COMPLETELY SOLD OUT, while September 11th has no more balcony rooms left. And we're only in April! WOW!

 

So what's the big innovation?

 

NCL has finally found a way to avoid the industry-wide practice of dumping rooms in the inside/oceanview/balcony categories.

 

They have accomplished this by decreasing revenue for:

 

- Specialty restaurants

- Beverage package

- Shore excursions

- DSC

- Additional people in stateroom

 

And while they give some of the above for free/cheap, this has enabled a much higher price point for the cruise fare, especially for the rooms which used to sell super-cheap.

 

This goes completely against the longstanding price model of cruising, where you pay relatively little, get no extras included, and charge onboard the things that you find you want/need which are not included. In fact, at the lower category rooms, the base fare was seen as a loss leader. Not anymore.

 

This was brilliant, as the "inclusions" don't cost them that much, and yet they make far more with the higher cruise fares they are now charging (and the avoidance of dumped rooms).

 

For example, the Ultimate Beverage Package costs them relatively little per customer, but they charge a lot for it. So now people get it for free on this promotion (if they choose that option), but many of them otherwise wouldn't have bought it anyway. And yet all of these people are paying substantially more in cruise fare, and believe they're getting a great deal because of what the UBP normally costs.

 

This situation, of course, is bad for the price-conscious NCL consumer. But it's great for NCL.

 

In an interesting twist, those with casino "free cruise" certificates (well, actually "free" means taxes+NCF) are now getting a lot more value, because base fare is so much more these days, and you're not likely to find many last minute bargains anymore.

 

The cruise I just booked would have been $4100 for the balcony stateroom I got, and I paid like $670 for taxes+NCF for 2.

Frank Del Rio is the founder of Oceania, and this pricing model is exactly what Oceania has always done. It has always been best to book early, and there has never been a significant price drop as the cruise nears. The ships have always sailed full or nearly so.

 

This was so successful that Oceania, which was founded in 2002 with just $14 Million in capital and sailed its maiden voyage in July, 2003, was sold to Apollo Management in 2007 for nearly $1 Billion for 70% of the company! No other cruise line has ever achieved that success in just 4 years.

 

After Apollo purchased Regent Seven Seas in 2008, they rolled that cruise line and Oceania into a new division, Prestige Cruise Holdings, and moved Frank Del Rio and his staff into place to manage both cruise lines. Regent was not in great shape -- they had not been sailing full. Mr. Del Rio applied the Oceania pricing model to Regent, and it succeeded spectacularly. When the general economy collapsed and the other luxury cruise lines were dropping their prices in a desperate attempt to attract guest, Regent held their price but began to offer free excursions and free hotel stays the night before the cruise. It worked -- Regent ships sailed full without a significant drop in revenue.

 

Now, NCL Holdings has purchased Prestige, and NCL, Oceania and Regent are "sister" cruise lines. Apollo Management, as the largest shareholder, has once again seen fit to move Frank Del Rio and many of his staff to head up the entire holding company. Mr. Del Rio, in turn, has appointed long-time associate Jason Montague as President of Oceania and Regent, assuring there will be few changes there, and long-time NCL stalwart Andy Stuart to President of NCL. They have begun the process of remodeling NCL's revenue to the model that has been so successful at Oceania and Regent, the model that PokerPro5 has so well described.

 

Of course, Regent is super expensive -- but it always has been. It's completely all-inclusive with included airfare (business class in the upper suites), hotel stays, all alcoholic beverages except the priciest wines (the over $100 per bottle stuff), excursions, etc. Oceania is also more expensive than mainstream cruise lines like NCL, but includes airfare, all non-alcoholic beverages, all specialty restaurants and the best food at sea. By the way, both are "freestyle" in the sense that all dining is open seating and timing.

 

NCL appeals to a different demographic, at a lower price point but with many more guests. Young families and children are permitted on Regent and Oceania but not often seen (there are no children's programs on those cruise lines). It is my observation, however, that when school is in session, and cruises longer than 7 days, the guests on NCL are no different than those on Oceania. In fact, despite my 169 days (so far) on Oceania, and 17 on Regent, I'm Platinum on NCL. The revenue model should work just as well on NCL, at a lower price point.

 

Is it good for guests? Most Oceania and Regent sailings have something like 70% repeat guests; many have a greater percentage. I expect the same for NCL as the "old guard" angry folks get weeded out and the more thoughtful begin to appreciate the differences.

[DreamingBig1]

The 1/2 price off 3rd and 4th passengers didn't work for me - I had started a thread on this subject last week - http://boards.cruisecritic.com/showthread.php?t=2194407

I recently did a comparison for the end of June, 7 night NCL vs. 8 night on Carnival from New York and the price difference was $841 less for a family of four and $700 less on Carnival. Don't think I could drink that much to make up for the price difference. We've sailed both and I like both...it all comes down to $$$$$.

 

Carnival is usually always the cheapest of the lines. I think it's historically been that way.

[Cauzneffct]

Seeing as how there are so many posts with people claiming they won't choose the UBP because they don't drink that much, I would say not. It seems like some people prefer getting OBC or their daily service charges paid over the other promos.

 

I thought this as well at first; we booked and chose the free DSC thinking we wouldn't drink enough for the UBP to be worth it. But then I realized that we'd only have to drink $25 between the two of us per day to end up "saving" more than with the free DSC. We'll see, but I think our bar bill will end up being higher than our DSC would have been.

Edited April 14, 2015 by Cauzneffct

[rochelle_s]

I thought this as well at first; we booked and chose the free DSC thinking we wouldn't drink enough for the UBP to be worth it. But then I realized that we'd only have to drink $25 between the two of us per day to end up "saving" more than with the free DSC. We'll see, but I think our bar bill will end up being higher than our DSC would have been.

 

You can always have it changed to the beverage package, just speak with your TA or PCC.

 

 

Rochelle