$2. DEPOSITS COMING TOMORROW

[alyssamma]

So, deposits are back to $3500 for the cruise I booked. The price is the exact same. To me, this was a great deal.

[alyssamma]

@FlorenceItaly love the handle. It's funny because I am heading there right now. On my way to the airport... Stopping in Holland for a few days but will be in Florence on Monday. 

[FlorenceItaly]

1 minute ago, alyssamma said:

@FlorenceItaly love the handle. It's funny because I am heading there right now. On my way to the airport... Stopping in Holland for a few days but will be in Florence on Monday. 

ENJOY!  Our DS and DIL live in Amsterdam!  Yes, Florence is a special place.

[BermudaBound2014]

On 4/18/2024 at 9:48 AM, TRLD said:

To be honest future bookings has far less impact than revenue and revenue projections. The cruise lines would not be running these to inflate there future bookings as some suggest, if by doing so they were having to lower there future revenue per booking numbers due to cancellations and an expected negative impact on prices in the quarter those cruises are actually taken 

 

 

 

Yet Revenue projections are based on future bookings. 

 

I would agree that if the total effect of the $1 deposits was to lower future revenue, then HAL would likely stop these promotions entirely. However; I do not discount the power of said revenue projections and suggest that increasing future bookings adds substantial value for the company. 

 

We will likely never know how many who book under the$1 deposit actually cancel, but I suspect it’s a number acceptable to the bean counters. Somewhere between everyone and nobody. 

 

 

[mightycruisequeen]

4 hours ago, alyssamma said:

So, deposits are back to $3500 for the cruise I booked. The price is the exact same. To me, this was a great deal.

Amen!  Same here!  I'm so glad I jumped on it for our long 2026 cruise, plus I got the cabin we wanted.  Win/win/win! 

[TRLD]

18 minutes ago, BermudaBound2014 said:

 

Yet Revenue projections are based on future bookings. 

 

I would agree that if the total effect of the $1 deposits was to lower future revenue, then HAL would likely stop these promotions entirely. However; I do not discount the power of said revenue projections and suggest that increasing future bookings adds substantial value for the company. 

 

We will likely never know how many who book under the$1 deposit actually cancel, but I suspect it’s a number acceptable to the bean counters. Somewhere between everyone and nobody. 

 

 

Not quite. If a company bases a revenue number or for that matter a sales number, and they ignore data in their possession that indicates that they are not taking into expected cancellations that might impact those estimates it would be considered a violation of SEC reporting regulations.  An issue that would place the company at risk from both regulatory action as well as a shareholder law suit if such a failure to use such information was ever to come to light. A situation where risk would far out weigh reward.

 

The revenue I was referring was the actual revenue for those quarters when the cruises actually occur.

 

Booking numbers are for all practical purposes interesting but not a real mover of stock price compared to actual revenue numbers. A slight bump in booking numbers, would be more than offset by negative impact to revenue in those quarters if cancellations resulted in an material reduction in fares then would have otherwise occurred.

 

Booking numbers were more interesting in 22 and early 23 when cruise lines were still building back occupancy and were a leading indicator of occupancy.  Now that occupancy is back far less interesting. They might become interesting again if there is a economic down turn  as a indicator of an impact on the industry. At this point not much.

Edited April 19 by TRLD

[BermudaBound2014]

Not quite. I wasn’t solely referring to stock price. But that’s ok, neither one of us will likely know the entire rational of why HAL is offering these low deposits. Last year they offered the $1 deposit 3 (maybe 4) times so it’s obviously working to achieve whatever the goal HAL has set.

 

[HappyInVan]

18 minutes ago, BermudaBound2014 said:

 Last year they offered the $1 deposit 3 (maybe 4) times so it’s obviously working to achieve whatever the goal HAL has set.

 

 

Lets look at it from a management perspective. Need to fill the rooms at a decent price? What do you do?

 

You can cut prices to fill the rooms, but a 40% cut would be disastrous to your margins. You can cut deposits in the hope that you can maintain retail  prices. Should the low deposits ultimately fail, you can still cut prices and offer promotions and freebies.

 

Let's assume that you've filled the ship and your margins aren't as good as you would like! You can still squeeze more people onboard with a 3rd 4th pax promotion. Hope that their onboard spending is high enough to make a difference. 

 

Ultimately, the company has the option of cutting costs and quality. This is something that the pax will notice.

 

So, all these options are available to HAL. The sequence that they are deployed reveals something of HAL's internal state.

 

What surprised me was that HAL used and is still using $1 deposits instead of $100 deposits. It suggests that HAL management is supremely confident or extremely desperate. Stay tuned.

[BermudaBound2014]

1 hour ago, HappyInVan said:

 It suggests that HAL management is supremely confident or extremely desperate. Stay tuned.

Or highly motivated to increase future bookings 😉 

[chill6x6]

As mentioned above...the cruise I booked yesterday...same price today...except $1200 deposit!😵‍💫

I should have booked at least one more....

[crystalspin]

5 hours ago, HappyInVan said:

What surprised me was that HAL used and is still using $1 deposits instead of $100 deposits.

Perhaps they are unsophisticated? I honestly would have jumped at a $100 deposit (times four) which would have given them $400 dollars to play with for 18 months...

[HappyInVan]

1 hour ago, crystalspin said:

Perhaps they are unsophisticated? I honestly would have jumped at a $100 deposit (times four) which would have given them $400 dollars to play with for 18 months...

 

Not likely. Any large company has access to marketing consultants to keep them informed of the industry's doings, and for advise on future policy, And, HAL has inhouse marketing expertise.

 

This is not rocket science. Various industries follow different traditional strategies. Non-perishable industries try to hold their retail (high) price for as long as possible. Then, blow out their inventory in a sale of the year. Airlines have to clear their seats by flight time. So, they start at a reasonable price and raise the price as the plane fills up.

 

On the other hand, luxury brands try to hold their price point while motivating their customers with excitement. What's the latest and greatest? What's in the next Fall and Autumn collections?

 

Seems to me that HAL has been unable to define themselves as a brand. They advertise about the excitement of Alaska. But, Alaska fares have been falling. And, their ships have problems with the excitement of entertainment.

 

IMHO, HAL doesn't have the right size in terms of corporate capacity and ship size. They need bigger ships to provide good shows at the current fares. On the other hand, smaller ships offer more varied itineraries but cost more to operate per pax.

 

The most important decision to be made as a brand is the choice of the corporate capacity. Too many rooms/ships means that you will inevitably have to discount at the margin, which affects your ability to hold the line on your retail (official) price.

 

Conglomerates like CCL tend to be messy. HAL is signaling that this is the way to go, "Follow us!" But, Princess blows them out of the water with a big discount. On the other hand, NCL has a clean line-up with just three divisions (high, medium, mass).

 

You must have noticed that each of HAL's initiatives alienates some of their old customers. CO gets the priority that senior Mariners used to own exclusively. The $1 deposit supersedes the old $100 Future Cruise Deposit. And, so it goes on. 

[Toofarfromthesea]

20 minutes ago, HappyInVan said:

 

Not likely. Any large company has access to marketing consultants to keep them informed of the industry's doings, and for advise on future policy, And, HAL has inhouse marketing expertise.

 

 

 

I'm not sure I buy this argument.  Any large company also has access to technology and web consultants to present a professional face to the public on their website yet look at what a long term cluster flop their website is.  

[TRLD]

5 minutes ago, Toofarfromthesea said:

 

I'm not sure I buy this argument.  Any large company also has access to technology and web consultants to present a professional face to the public on their website yet look at what a long term cluster flop their website is.  

Oh he just like trying to make HAL out to be incompetent since he is one of those they have alienated by changes. He spends a lot of time critiquing a cruise line that he said he stopped sailing even back before Covid.

[HappyInVan]

36 minutes ago, Toofarfromthesea said:

 

I'm not sure I buy this argument.  Any large company also has access to technology and web consultants to present a professional face to the public on their website yet look at what a long term cluster flop their website is.  

 

The operational area that you are referring to can be affected by any number of issues. It may be under-funded. Is HAL trying to cut costs?

 

Does the IT department have the expertise? As I understand it, corporations sub-contract a number of IT functions. Were the contracts awarded to the right people or to the lowest bid?

 

It may need new middle managers. Ideally, management set the parameters for a procedure that is consistent with corporate values. For example, efficiency and timeliness is important. But, the app should also be easy to use.

 

This is my experience with the app and it should be enlightening. Google Play wouldn't allow me to download HAL's app because it was supposed to be not compatible with my device. On the ship, the IT person offered us a QR code to download the app.

 

I asked the IT person, “Why don't you speak to the Google IT people and sort out this compatibility issue.” Huh?

 

I don't know if HAL ever fixed the issue. I dare not un-install the HAL app. After my next and last HAL cruise under current management, the app will be gone from my device.

 

[Blackduck59]

I think the $1.00 deposit is a great idea...for cruisers. I know there are some who book a whack of cruises with no intention of taking all of them. I also think the majority of those who use the  $1.00 deposit to book a cruise they would definitely take, many would even make the regular deposit. The sale just means they get to keep that money in their account until final payment. Holland America gets the booking they want, the cruisers get the cruise they want, it's a win win. I think some members seem to be jealous that they missed "The Deal", or their special needs cabins are all sold out to others who pulled the trigger first.

Whether it is fiscally responsible for HAL is irrelevant to those making the bookings. If the line goes down oh well they lost 2 bucks. Of course those of us that paid full deposits would be screwed. I'm hopeful HAL has it right and all is well.

For those that got in on the deal, good for you, those that missed out, better luck next time.

Edited April 20 by Blackduck59

[ChinaShrek]

10 hours ago, HappyInVan said:

 

You must have noticed that each of HAL's initiatives alienates some of their old customers. CO gets the priority that senior Mariners used to own exclusively. The $1 deposit supersedes the old $100 Future Cruise Deposit. And, so it goes on. 

But these initiatives attract younger customers who do not want to sail for years to have elite status and like the idea of putting $1.00 down on a couple of cruises for 2026. As many of the old customers migrate to other lines (for whatever reason) new customers will replace them. Why do I sail HAL? Cool itineraries, good food, great staff, and low casino pricing. No other line comes close.

[sfaaa]

$1 deposit is about buying a future cruise option at little or no cost. What is there not to like?

Edited April 20 by sfaaa

[HappyInVan]

Sorry. Not going to waste my time booking cruises that I'm not serious about. Moreover, you might be reserving cabins that someone else wants.

 

I'm booked on the NA this summer 14D Alaska cruise. Paid just C$1599 pp for a partial OV Stateroom 4091. Checked the equivalent itinerary and room next year. Its $2,826 for the Noordam and C$2,388 on the NA.

 

Seems like a big difference. Would I pay a $1 deposit for a 2005 booking? What do you think? 

[Travelexpert35]

Just wondering, does HAL offer the $1 deposit a couple of times per year. I missed out on this. I know they also offer $25 deposits as well. Not sure when they will pop up.

[TRLD]

12 hours ago, HappyInVan said:

Sorry. Not going to waste my time booking cruises that I'm not serious about. Moreover, you might be reserving cabins that someone else wants.

 

I'm booked on the NA this summer 14D Alaska cruise. Paid just C$1599 pp for a partial OV Stateroom 4091. Checked the equivalent itinerary and room next year. Its $2,826 for the Noordam and C$2,388 on the NA.

 

Seems like a big difference. Would I pay a $1 deposit for a 2005 booking? What do you think? 

A bit late to pay $1 for a 2005 booking.

 

On the other hand for some 2025 or 2026 cruises, I certainly would  It would allow me to get the 2 person room I want locked in, and if the fare drops it only costs me a dollar to cancel and rebook under the lower fare. Total end cost $1 more than the cheaper fare if one appears.

 

 

[crystalspin]

14 minutes ago, Travelexpert35 said:

Just wondering, does HAL offer the $1 deposit a couple of times per year. I missed out on this. I know they also offer $25 deposits as well. Not sure when they will pop up.

Yes, they have offered lower deposits several times a year recently. Sometimes only on selected cruises (like ones that are coming up/same season etc). Apparently this last one is the company's "birthday" and was for all sailings but Grand Cruises and very short ones.

 

Black Friday/Cyber Week was I think $25 deposits; I forget the terms but I was able to increase my deposit on two of a B2B2B (from $1pp to $25pp!), lower the cost of the cruises significantly, switch from HIA/EBB to regular HIA but still get pre-paid Daily Service Fee!

 

Additionally, I believe there was a low-deposit "event" in early summer (June or July) last year.

 

Edited April 21 by crystalspin

[julia]

Call it what you will, but it works.  Even if the actual conversation rate (those who keep vs cancel) is 50% or higher, HAL will eventually fill those berths.  I jumped on the $1 offer and will watch for any future low deposits.

[jlawrence01]

I listen to so much of the cruise press that tells me I need to "book now" as bookings for ALL of the large cruise lines are "at record levels" and that all of the good ships will be sailing full.

 

If that were truly the case, why is HAL offering $1 deposits?  Why is Carnival offering $25 deposits on a lot of their cruises?  Maybe these cruise lines are doing some "window dressing" to keep Wall Street happy.

 

By the way, in the past two weeks, RCCl has dropped the price of their cheapest fare on the Icon of the Seas from over $2900 to $1899 for a December 7th sailing and that is one of the "latest, greatest ships".

 

Personally, i think that we are going to see a lot of discounting in future months and i think that I am going to hold off booking anything past September 2024 until i see the deals available.

[Menocchio]

Lots of very conspiratorial thinking for what's a pretty basic marketing tactic.

A limited time $1 deposit gets people to make a decision to book *NOW*. If they waited, they may decide instead not to book at all, or to go with another cruise line. Even if a fair number of people cancel and get their dollar back, a larger number will have end up sailing that may not have without the promotion (Or at least, that's the theory). 

 

As for why cruise lines keep doing bonkers promotions when cruising is supposedly doing so well, it's because they want to do *even better*. A publicly traded business needs to continually expand. Not just have a sustainable revenue:expenses ratio. Not just make more money ahead of inflation. They need to make more money than they made last year. Which actually becomes somewhat more difficult if last year was a very good year. Nobody's allowed to rest on their laurels.