The Payback on Celebrity's Recommended Merchants

[Bfson]

While reading a story on msnbc.com written by their travel ombudsman, I ran across this paragraph:

 

"Onboard Media contracts with Celebrity Cruises to run its "Guaranteed Shopping Program" in Santorini. According to Rogavopolous, Onboard Media gets 10 percent of every sale made to cruise passengers, plus an additional 5 percent to cover advertising costs on board the ships. "Every time the ship come in I send them [Onboard Media] a check for $5,000, $6,000 — sometimes more," Rogavopolous complained. "Onboard Media are pimps to the cruise tourists."

[omeinv]

So his total payout is 15%? If he sends them a check for $6,000.00, that indicates gross sales to the ship's passengers of $40,000.00.

 

As everywhere, people talk about pimps with disdain, yet one seldom hears of one having a "going out of business sale". It would interest me to learn how this shop owner sees himself, if he characterizes Onboard Media in this way. One presumes the shop owner here could drop out of this marketing arrangement at any time. A luxury the usual prostitute is not allowed with pimps.

 

Harris

Denver, CO

[Joanne G.]

Because of his payments to Onboard Media, passengers are made aware of his store. It doesn't seem like a bad way to reach a captive audience of potential shoppers. If he doesn't feel it brings in enough customers to make it worth what he spends, then he should advertise his store some other way.

 

If Onboard Media doesn't live up to their much-hyped "guarantees" - as some on these boards have reported - that's shameful. But I don't see anything inherently wrong in store owners having the choice to advertise their stores to passengers in this manner.

 

P.S. If the payments to Onboard Media are truly a percentage of sales to cruise passengers, how is this figure reported?Unless customers sign a statement that they are or are not cruise passengers (Santorini is full of non-cruise tourists), and unless Onboard Media sends auditors around the end of the day tallying up sales, I don't get how it works. Honor system???

[Pontius Navigator]

Joanne, you suggest store owners have a choice but Onboard Media is contracted to Celebrity (it says above). If that is the case maybe there is a monopoly and the store manager pays up or gets out.

 

You then ask how the percentage is calculated. Easy, as no money passes hands on board except through the on board accounts it would be simple to cream off the given percentage.

[Joanne G.]

Joanne, you suggest store owners have a choice but Onboard Media is contracted to Celebrity (it says above). If that is the case maybe there is a monopoly and the store manager pays up or gets out.

 

I'm confused - I thought the OP was referring to stores on the islands. I hardly believe that land-based store owners have to close up shop if they don't want to contract with Onboard Media. It sounds like you are referring to stores on board the ship.

 

You then ask how the percentage is calculated. Easy, as no money passes hands on board except through the on board accounts it would be simple to cream off the given percentage.

 

Again, I thought we were talking about stores on land. If I buy piece of jewelry from a merchant on Santorini, it doesn't pass through my onboard account. No one on the ship knows how much I spent on shore or where I spent it.

 

If we are talking about stores onboard the ship, well, I still wouldn't find it unusual that they pay a % of sales and/or a fee in order to operate a business on the ship.