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pokerpro5

Here is what I believe NCL's reopening pricing plan will be, once things get going again

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Posted (edited)

I have been extensively been studying the cruise industry pricing model over the years, especially NCL, and have an excellent record regarding predicting pricing trends.

 

Based upon my studies of the recent (pre-COVID-19) pricing scheme, as well as current prices, I have applied it to come up with a theory as to the way NCL will price cruises once everything restarts

 

Be aware this is only a theory and not based upon any inside information, but I would be surprised if the actual situation turns out to be vastly different from what I have deduced.

 

1) Prices will remain high for as long as a substantial amount of recently-issued FCC remains unspent.  NCL needs desperately cash right now, hence their very difficult (and intentionally slow) behavior regarding refunds.  However, they also need to survive going forward, so they do not want the FCC they issued to be used to snag cruise bargains.  If bargains are to be had, they want that to come from new money, rather than already-captive money.  Thus, prices will be continue to be fixed artificially high until they feel a sufficient amount of the FCC has been spent.  Exceptions will be made on a case-by-case basis when cruises pass final payment date, depending upon booking levels (see below).

 

2) Prices for suites and mini-suites (now called 'club suites') will remain similar to what you remember before.  If you're looking for a deep discount on a suite when cruising returns, you're going to be disappointed.  Suites are a premium product which the industry (not just NCL) has long resisted discounting, as they do not want to degrade the perceived value of the product.  Since suites do not make a large percentage of the ship, NCL will let these go unsold if they don't manage to fill up at "normal" prices, and then use the bidding upgrade process to fill them (again, see below).

 

3) Prices for inside/oceanview/balcony rooms will be fairly similar to what you remember, prior to final payment date.  NCL does not want to attract an entire ship full of bargain cruisers, as this affects them in two ways.  First, these people pay less fare, so NCL makes less money up front.  Second, these people tend to be frugal in general, and are the least desired customers.  A ship full of these type of people (I'm one of them, by the away) would be a disaster for NCL, and they would lose money.  Additionally, if they sell these rooms at a discount prior to final payment date, many people (including FCC users) will notice and re-price their cruise to the current bargain rates.  Therefore, even in a terrible market (which it will be), they will attempt to sell as many non-suite staterooms as possible at "normal" prices, and you will not see deep discounts.  The deep discounts will appear once the 50% cancellation penalty phase begins (90 days before cruising, based upon the pre-COVID19 policy).  Want to know how the discounts will happen?  Once again, see below.

 

4) The deep discounts will be on inside cabins only at first, and the upgrade bidding system will be utilized to fill all other cabin types, as much as possible.  The discounts will be tremendous, but you may have to wait a bit, as they will likely come in phases, starting at the 90-day mark prior to sailing.  They will keep discounting these rooms as much as possible until they start selling.  You might see some of these go for practically nothing.  If they are not getting enough bids for upgrades to oceanview and above on a particular ship, they will start pushing existing reservation holders on that ship to do upgrade bids (via e-mail solicitations).  If they still don't get enough upgrades to oceanview and/or balcony, then those prices will drop as well.  Keep in mind that this was already their existing pricing policy BEFORE COVID-19, but you will see it take place even more often as they struggle to get people on cruise ships again.

 

5) Unsold mini/club-suites and suites will be filled by upgrading balcony pasengers.  You will perhaps even see phone calls being made offering flat price upgrades if there are not enough bidding upgrades.  If you have a balcony room, you might want to throw a cheap upgrade bid in for fun.

 

 

So how can you best use this information to your advantage?  Glad you asked.

 

First off, DO NOT make a cash booking right now.  Seriously.  Don't.  Keep that credit card firmly in your wallet.  NCL is on very rough seas right now, and there's a chance they may sink.  If they survive, there will be PLENTY of opportunity to book later.

 

If you have an FCC, DO NOT book anything except for a suite right now.  If you do, you're almost 100% going to get a bad deal, even with the "20% discount" being offered.  Do not assume you're getting a good deal by comparing the previous price you paid to the one being offered now.  The markets are not at all comparable!  However, if you're booking a suite, then go ahead and book now if you have FCC, provided that the price you're paying isn't HIGHER than what you got it for initially.  If the price appears high, just wait.  It will come down to normal when most of the FCC gets spent.  Trust me.

 

If you have an FCC and want to cruise in an inside/oceanview/balcony, DO NOT BOOK NOW.  You will be getting a horrible deal compared to the open market, as described above.  There will be PLENTY of these rooms open on future cruises.  And when I say plenty, I mean P-L-E-N-T-Y!  They are going to immensely struggle to fill these rooms.  Therefore, wait until at least 90 days before your cruise, and then start price-watching.  Do not jump on the first good deal you see at that point.  Watch closely, and only book when it seems the prices are hitting bottom.

 

If you really want to gamble for a balcony room for the very best price, book a bargain INSIDE cabin as described above after the 90-day mark, and then try submitting a fairly cheap upgrade to a balcony.  Decent chance you'll get it.

 

Of course, before you do any of this, make sure flights are available and reasonably priced before locking yourself into a cruise in this fashion.

 

I will bump this thread when everything gets going again, and you'll see I was correct.

 

Happy booking!

Edited by pokerpro5

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.Wow totally agree with this analysis.

 

I do have experience in demand/dynamic pricing and this post  is good, indeed very good. I can tell you that you are completely correct about the FCC - anyone who disagrees is away with the fairies. Well done.

 

I think the only part that I would say is unknown is the how much demand is going to be and whether cruising as a growth industry will be the same. You seem to agree with my own analysis that it will weak to moderate. Industry believes it is going to drive huge demand. I do not  think this is correct due to my studies in behavioral sciences.

 

But essentially only time will tell as these are very unprecedented times.

 

Cheers

 

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Does this mean it was a better choice to get the cash refund rather than FCC?

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Absolutely there is chance they will go bust (slim) and any event you are now no longer wedded to a cruise with NCL and prices may well come down!!

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Makes complete sense.  I really can't imagine anyone actually paying for a cruise right now.  I've been price watching very closely and have my eye on a couple of itineraries that I think might be a possible go after they reboot, but I would not consider paying  anything until 1. I see they they are actually up and running and doing so, successfully, and 2. until we are inside the 30 day window...just so I can keep watching their pricing strategy.  I think there will be plenty of bargains to be had, even if the prices remain high, as we move closer to actual embarkation dates.

 

Thank you for taking the time to post your insights.

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Posted (edited)

Not attacking your "research" but this is exactly how NCL and other lines have been operating for years LOL

The inside and ocean view cabins are always discounted 30 days before a cruise and are the last to be filled.  Not sure how much research can go into repeating the status quo.  So if nothing changes you will bump the thread to predict you were right?

IMHO this is a prediction and not research.  So everything stays the same and the sun will come up tomorrow.  I will bump this thread to see if I was right 🤣

 

 

Just teasing and messing with you.  Give me a break, I am locked inside too bored and eating myself to death 😷

 

Edited by david_sobe

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What do you think will happen if the cruise lines are forced to reduce their ship's capacity for a while before they are allowed to go back to normal full ships?  I keep seeing the 50% number thrown around in conversations regarding the cruise line's plans to meet the restrictions they will likely have to meet in the near future.

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Studies out of NY show the most significant fatal risk factor after age is obesity. Could you custom design a virus better to destroy the cruise industry? Me thinks, no.

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45 minutes ago, david_sobe said:

Not attacking your "research" but this is exactly how NCL and other lines have been operating for years LOL

The inside and ocean view cabins are always discounted 30 days before a cruise and are the last to be filled.  Not sure how much research can go into repeating the status quo.  So if nothing changes you will bump the thread to predict you were right?

IMHO this is a prediction and not research.  So everything stays the same and the sun will come up tomorrow.  I will bump this thread to see if I was right 🤣

 

 

Just teasing and messing with you.  Give me a break, I am locked inside too bored and eating myself to death 😷

 

 

Well I'm glad you're only teasing and messing, but to answer what you wrote anyway...

 

1) Inside/Oceanview cabins are not "always" discounted at any time.  The discounting can happen any time between 90 days prior to sailing and 1 day prior to sailing.  I'd ballpark the best deals to come 30-60 days prior to sailing, but it varies.

 

2) While some of what I wrote occurs normally anyway, I had to repeat a lot of that information so people could coherently follow my logic regarding pricing, and when it is likely best to book (and worst to book).

 

3) Whatever occurred in the past regarding bargain prices will occur to a greater extreme, most likely.  And then, of course, there's the matter of the mass issuance of FCCs complicating things, which I explained, as well.

 

 

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Posted (edited)

I suppose this is sort of true but we have to remember it's all about dynamic pricing based on occupancy.  If you have the flexibility to book a cruise 30 days or less before sailing and are somewhat flexible on the ship and itinerary, you will get the best "sail away" deal inclusive of suites and haven products.

 

Dynamic pricing even carries over to bidding; on my last two NCL cruises, the minimum amounts changed around 30 days prior to sailing.  Most recent Jan 2020 cruise decreased while my May 2019 cruise increased.

 

For your employer, the key is to give them as much notice as possible.  Simply tell you employer now (for example) you're planning on an July or August week long cruise that will require you take eight business days off and you won't be able to give exact dates until a few weeks before.

Edited by NutsAboutGolf

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Posted (edited)

interesting review. I guess we are # 3. We are not 100 % bargain hunters but i guess they don't like us. LOL. We don't take the drinking or dining package. We do eat at specialty restaurants but only when we want to and pay for the ones we like. We usually do Inside cabins and wait for prices to go down to upgrade to Balconies ( it has worked for us in the past 10 years) we hardly end up in the cabin we originally booked. We tend no to buy in the shops. We buy drinks when we want them etc. We usually book outside excursions because we get better and cheaper excursions elsewhere. We will continue to cruise our way. 🙂

Edited by spanishguy1970

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Cruising will be priced by what the market will bear. 

 

If they set it artificially high like is suggested to eat up cruise credits at some point you have to make sales which means dropping the prices to the market standard.  Once you do that then all the people using the credits will have the time to have their rates adjusted.

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It's just wonderful how many ppl think they know exactly, or close to it, how the cruise lines will be rolled out.  I'll be sitting on the side lines checking things out.  

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Posted (edited)
30 minutes ago, All-ready2cruise said:

It's just wonderful how many ppl think they know exactly, or close to it, how the cruise lines will be rolled out.  I'll be sitting on the side lines checking things out.  

 

The other thing is folk ASSUME cruising will be exactly like the pre-C19.  We're already seeing cut backs, specialty dining perks have eliminated one meal.  I truly wonder what the MDR menus will look like; one "trick" they could do is replace 1 or 2 of the most expensive items (steak and seafood) but add 3-4 cheap items (pizza, hot dogs and burgers).  "For your convenience, we revamped our menus, to increase our selection!" I also wouldn't be surprised if some expensive items in the specialty restaurants receive an up-charge.

Edited by NutsAboutGolf

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I agree! I think we should expect the unexpected. There are very few things that would surprise me at this point.  I think the other thing is, that some seem to forget that this is a worldwide event of unprecedented proportions.  The fact that there is so much information available should, IMO, be taken advantage of it.  

 

Who knows, some have even predicted the downfall of cruising as we know it... think a new era is very much what we should expect. 

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11 minutes ago, NutsAboutGolf said:

"For your convenience, we revamped our menus, to increase our selection!"

That’s what Carnival did when they introduced their “comfort food” items to the MDR dinner menu. The eliminated some selections but then added fried chicken, meatloaf and Mac n’ Cheese. 

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Posted (edited)
1 hour ago, ray98 said:

Cruising will be priced by what the market will bear. 

 

If they set it artificially high like is suggested to eat up cruise credits at some point you have to make sales which means dropping the prices to the market standard.  Once you do that then all the people using the credits will have the time to have their rates adjusted.

 

Yes and no.  The "market will bear" only half applies to cruising because of the final payment situation, which is different than any other travel payment model.  Most other travel products you're either paying up front with little-to-no-refund ability (most airlines), or paying after-the-fact with free cancellation almost up until the service is delivered (most hotels).

 

Cruises are in the middle of those two models.  There's a long, free cancellation/re-pricing period (before final payment), and a long, high-penalty cancellation period (after final payment).

 

This essentially creates two different markets -- the before-final-payment market (higher prices, except for some outlier high-demand cruises), and the after-final-payment market (lower prices).

 

The before-final-payment market only typically sees price increases (for high demand) or static pricing (for medium and low demand).  They will hold these prices relatively static (with only small adjustments down) if the cruise isn't selling well.  This is because people who paid higher prices already can adjust them down, so they don't want that occurring.

 

After-final-payment is somewhat related to what the market will bear (they will keep lowering prices until cabins are filled), but again it's not just a function of that.  They also use the upgrade bidding process to do this, so they can both keep the premium products from being discounted, AND relegate the bargain shoppers to the least desirable cabins (insides, often ones on the lower decks).

 

The bottom line is that this is a lot different than typical supply-and-demand pricing.  If a burger place can't sell burgers at $7 each, they might lower the price to $6.  If they are selling a ton at $7, they might raise the price to $8 and see what happens.  This isn't quite so simple, and it's instead more helpful to understand the pricing patterns, and what gives you the best chance for booking success.

 

Regarding the FCCs, these people booking at the bad prices will be stuck once final payment date passes.  Again, that's one of several reasons why you won't see the good deals until AFTER final payment date, and more likely after the 50% penalty phase starts.

Edited by pokerpro5

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Cruising is an enigma when it comes to the world economy.  During the last economic recession, the cruising industry was immune from crisis unlike many land vacation places.  Even when cruises were being cancelled during this pandemic, cruise lines were still booking 2021 cruises like crazy.  So predicting anything is risky.

The economy will definitely have an impact.  Way too many people out of work or under-employed during the next year.  I say no way cruise lines will be able to sustain their prices prior to this pandemic.  Cruising is very expensive lately.  Will this be what causes the pendulum to swing back in the customer's favor?  Lets hope so.

I live in Miami so I am always offered those last minute cruise deals on inside cabins and ocean view cabins.  Those are the most abundant and least expensive all the time no matter what the prices.

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Posted (edited)
1 hour ago, pokerpro5 said:

 

Well I'm glad you're only teasing and messing, but to answer what you wrote anyway...

 

1) Inside/Oceanview cabins are not "always" discounted at any time.  The discounting can happen any time between 90 days prior to sailing and 1 day prior to sailing.  I'd ballpark the best deals to come 30-60 days prior to sailing, but it varies.

 

2) While some of what I wrote occurs normally anyway, I had to repeat a lot of that information so people could coherently follow my logic regarding pricing, and when it is likely best to book (and worst to book).

 

3) Whatever occurred in the past regarding bargain prices will occur to a greater extreme, most likely.  And then, of course, there's the matter of the mass issuance of FCCs complicating things, which I explained, as well.

 

 

LOL You keep repeating the obvious.  Everything you state is accepted as reality IMHO.  It would be more exciting to read something of a dare prediction 😉

Edited by david_sobe

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11 minutes ago, pokerpro5 said:

 

Yes and no.  The "market will bear" only half applies to cruising because of the final payment situation, which is different than any other travel payment model.  Most other travel products you're either paying up front with little-to-no-refund ability (most airlines), or paying after-the-fact with free cancellation almost up until the service is delivered (most hotels).

 

 

 

Except they can't reliably fill the ships up last minute, especially in the after final payment time frame.  Many times they struggle with that even with the limited inventory left over after a cruise has been on the market 2 years.  Vacations just require too much planning if you aren't within driving distance of the port.

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Posted (edited)

  

53 minutes ago, pokerpro5 said:

the final payment situation, which is different than any other travel payment model.  Most other travel products you're either paying up front with little-to-no-refund ability (most airlines), or paying after-the-fact with free cancellation almost up until the service is delivered (most hotels).

  

53 minutes ago, pokerpro5 said:

Regarding the FCCs, these people booking at the bad prices will be stuck once final payment date passes.  Again, that's one of several reasons why you won't see the good deals until AFTER final payment date, and more likely after the 50% penalty phase starts.

 

You have many great points, I just wanted to focus on these two.  While I don't see the "final payment" model going away, I wouldn't be surprised if the T&Cs change.  I have no idea with the current NCL FCC T&Cs, but wonder if they're not already, excluded from "sail away" offers.  T&Cs WILL change in NCL favor, the only question is which T&Cs?

Edited by NutsAboutGolf

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1 hour ago, Tapi said:

That’s what Carnival did when they introduced their “comfort food” items to the MDR dinner menu. The eliminated some selections but then added fried chicken, meatloaf and Mac n’ Cheese. 

Yul, yuk.yuk 

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3 hours ago, NutsAboutGolf said:

For your employer, the key is to give them as much notice as possible.  Simply tell you employer now (for example) you're planning on an July or August week long cruise that will require you take eight business days off and you won't be able to give exact dates until a few weeks before.

 

As a supervisor who approves vacations and helps manage the time off balances of the entire Company, that sort of request will not fly this year.  It might work in a 'normal' year, but the fact is that right now people aren't taking vacations.  They can't go anywhere, so why burn the time?

 

No, many people are saving their time to use later in the year when they are free to move about.

 

We've already warned our entire staff that they need to plan NOW for the time they want, and get their requests in, because we will be in a position this year to deny requests to keep staffing levels right.  Normal year we've never had issues, but this year we expect a lot of people are going to want to take off at the same time, and we cannot allow that to happen.  

 

People are also told that once their request is approved, if they need to change not to expect that the change will be approved.

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2 minutes ago, msmayor said:

 

As a supervisor who approves vacations and helps manage the time off balances of the entire Company, that sort of request will not fly this year.  It might work in a 'normal' year, but the fact is that right now people aren't taking vacations.  They can't go anywhere, so why burn the time?

 

No, many people are saving their time to use later in the year when they are free to move about.

 

We've already warned our entire staff that they need to plan NOW for the time they want, and get their requests in, because we will be in a position this year to deny requests to keep staffing levels right.  Normal year we've never had issues, but this year we expect a lot of people are going to want to take off at the same time, and we cannot allow that to happen.  

 

People are also told that once their request is approved, if they need to change not to expect that the change will be approved.

 

I understand and agree that this is very YMMV and that not everyone has that luxury.  I recently learned at my job, I could not take ten business days off, max is nine business days off for a personal vacation, yet I was told a honeymoon is an exception (hello 90 day finance and annulment! lol) On the other end of the spectrum, there are people who have no problem taking weeks off on short notice.  It's all about setting yourself up for success, if you have a backup, talk to them before you talk to HR/your supervisor.  Only you know your situation, perhaps telling your boss "OMG, my dream ship and itinerary is 75% off, but it sails in two weeks, can I go on it?"  is better than an advanced notice.  In another words, do everything in your power to make it difficult for your vacation time approver to say "no".  😄

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