HAL Seattle: Fill the ships!

[bepsf]

I read this in the CC.com news section today:

 

"Interestingly, opinions on pricing strategies varied across the board. Dan Hanrahan, CEO of Celebrity and Azamara Cruises, indicated his discomfort with offering the Celebrity brand in the marketplace below a certain price. He noted that Celebrity won't take business if it'll hurt "pricing integrity" or adversely affect the brand image. On the flip side, Holland America's Stein Kruse countered: "It's simple. Not filling our ships does not make sense; our business model is based on [filling ships]."

 

If the objective in Seattle is to fill all the berths - prices be dam-ed - that's got to affect the onboard experience: lower quality food, fewer staff, higher prices for onboard amenities such as spa, drinks, etc....

 

...I just don't see HAL being able to continue offering a premium product for WalMart prices - and if that becomes the case, what will be the point of HAL anymore?

[Old As Dirt Mom]

......

 

...I just don't see HAL being able to continue offering a premium product for WalMart prices - and if that becomes the case, what will be the point of HAL anymore?

 

Brian, I understand where you're coming from, and to a certain extent I agree, but in our current economic climate the priority right now is survival, pure and simple. HAL may have learned something in its 140 years of operation.

[HALFans]

Well, I just got off the Ryndam last Sunday and they've managed to chase this loyal customer to another line.

 

Not saying I won't be back, but it's time to finally shop around and see what else is out there.

 

I think I just heard the call of Celebrity... ;)

[fatcat04]

I can not speak for those who love HAL BUT as a die hard Disney fanatic and DVC member, I know I have struggled with some of the changes/additions they have made over the years (though I will never forgive them for dropping Mr. Toad's Wild Ride.. for shame!!:p) but they have been able to weather a great many storms and come out on the other side a strong company with diverse options. And after much huffing and puffing on my part, some of the changes have been pleasant and happy surprises. I may not like all the changes and may shake my tiny fist at Disney Corporate but I would sooner have the Mouse than not.

 

In this time when vacations themselves are luxuries, most people I know with a job, a mortgage, kids, and bills to pay are not thinking the same way they did a year ago. I and my family have only so much disposable income at hand, we are blessed (and frugal) enough to be able to pay cash for everything, and we will try for the best quality we can get for our cash. But in the end, Mr. Wallet wins. :rolleyes:

[our turn]

Whether the fares are reduced to fill the cabins or the ship sails at significantly less than capacity, the quality will suffer.

[kryos]

...I just don't see HAL being able to continue offering a premium product for WalMart prices - and if that becomes the case, what will be the point of HAL anymore?

Exactly. This economy is not all good news for avid cruisers. And, wait until they try to raise the prices again when the economy turns around. People will not accept it. They will be familiar with the new "discounted" HAL and will think that they will get the same thing at the higher prices. If they're gonna pay higher prices, they'll just try a totally different kind of vacation, maybe not a cruise at all.

 

Blue skies ...

 

--rita

[Lurker1]

I'm not sure traveling on a half-full ship would be all that wonderful. On last year's Westerdam Spring Panama Canal Transit, 2/3's of the pax got off in San Diego. During the last 4 days (to Vancouver, where 80 Canadians got off, and then to Seattle), both the service and activities slipped a bit. Not that we had a bad time, but there was definitely a different feel to the cruise.

[kryos]

Whether the fares are reduced to fill the cabins or the ship sails at significantly less than capacity, the quality will suffer.

No, not necessarily. If the ships sail at less than capacity ... say at 75% or 65% of capacity, the lower numbers of staff will still be able to offer a premium product, because they won't have as many people onboard to offer it to. If you slash prices, and fill the ships at any price, then those same fewer staff members now have to serve a ship full of people, and clearly with less of them, quality is going to suffer big time.

 

Blue skies ...

 

--rita

[kryos]

...I just don't see HAL being able to continue offering a premium product for WalMart prices - and if that becomes the case, what will be the point of HAL anymore?

I would rather see HAL take a few ships out of circulation for a while than cut their prices to WalMart levels. Let's face it, other than the obvious cost cuts that will be necessary if the cruise price is less, you're also going to get an entirely different "element" onboard the ships.

 

Let's face it. I think HAL is really two entirely different cruise lines, and I only wish they would go the route that Celebrity did with Azamara and break them up.

 

There is the traditional HAL -- the smaller ships, the elegant service, the exotic itineraries, etc. You find that on ships like the Prisendam, the Statendam, etc. ... and you find it on the longer cruises to more far-flung destinations. That's the premium or the deluxe HAL. But then you've got the mass market HAL too, and that's the larger ships ... the Vistas and now the Eurodam ... doing seven-day sailings to Alaska, the Caribbean and Mexico. These are primarily "family" sailings where the price is lower ... probably on the same level as an equivalent Carnival or RCI cruise would be ... and a lot of the traditional HALmarks of cruising have been dropped in favor of that new passenger demographic (who probably don't care about things like dress codes and traditional dining anyway), and also in favor of keeping the costs down. It is that second kind of HAL that is no different in product than Carnival or RCI. It is mass market, just like they are ... not one iota different.

 

Yes, I can well imagine HAL offering the standard pool games on those sailings ... Hairy Chest Contests, and other silly diversions ... because that is what those people want, and those games are a lot cheaper to offer than say a cooking demonstration. Not saying there is anything whatsoever wrong with hairy chest contests. You have to give the people what they expect in their cruise, and these people are generally younger and want some entertainment while they guzzle their fifth can of beer at the pool.

 

Cutting prices and expenses will clearly result in at least cruises on the mass market lines becoming an entirely different product that appeals to a different sort of person. When I was a kid, I loved the Jersey Shore ... Wildwood. Why? Because that is what suited me at the time. We could get a basic cottage somewhere off the beachfront for a reasonable price and then spend our days on a crowded beach, and our nights on a noisy boardwalk. But that was fine for me at that time. Today it would not be. Today I want something more refined. HAL has always met that need for me as I have gotten older, but cut costs too much and you're gonna get lots of young kids, beer guzzling, party hardys, etc.

 

That's not what I look for in a vacation today, so I guess I would just wind up sailing a different line ... something in the deluxe category ... or, if I couldn't afford it, not sailing at all.

 

Blue skies ...

 

--rita

[bellebaby]

"On the flip side, Holland America's Stein Kruse countered: "It's simple. Not filling our ships does not make sense; our business model is based on [filling ships]."

 

I don't see this course of action by HAL in Alaska for veranda categories and above. HAL is holding firm on pricing and still has availability. Princess has been agressively pricing their product. I prefer sailing with HAL. But, as a previous poster said, "Mr. Wallet" won and I will be sailing with Princess.

 

B

[kryos]

[i prefer sailing with HAL. But, as a previous poster said, "Mr. Wallet" won and I will be sailing with Princess.

And trust me, you won't see any difference in that Princess cruise than you would have found with the HAL one. Mass market is mass market and while HAL may have some differences over Princess, trust me ... Princess has some unique differences over HAL too.

 

Blue skies ...

 

--rita

[kelmac]

I read this in the CC.com news section today:

 

"Interestingly, opinions on pricing strategies varied across the board. Dan Hanrahan, CEO of Celebrity and Azamara Cruises, indicated his discomfort with offering the Celebrity brand in the marketplace below a certain price. He noted that Celebrity won't take business if it'll hurt "pricing integrity" or adversely affect the brand image. On the flip side, Holland America's Stein Kruse countered: "It's simple. Not filling our ships does not make sense; our business model is based on [filling ships]."

 

If the objective in Seattle is to fill all the berths - prices be dam-ed - that's got to affect the onboard experience: lower quality food, fewer staff, higher prices for onboard amenities such as spa, drinks, etc....

 

...I just don't see HAL being able to continue offering a premium product for WalMart prices - and if that becomes the case, what will be the point of HAL anymore?

 

Brian,

 

On this one I agree with you. Two days after I made final payment on my Maasdam cruise, the price dropped and all of us booked will subsidize the new comers. On Celebrity, Azamara, and RCI -- if the price drops after final payment cruisers receive a refund if they request it.

HAL is even offering -- "bring the kids along for $199 each". Our last Westerdam cruise felt a bit more like Princess and a little less like Holland America.

I still want to love HAL, but they are kind of making it a little more difficult.

 

Kel

[mamaofami]

I think, like all businesses, HAL will do whatever it thinks will help them to stay afloat in these difficult times which won't last forever. If they think sailing with less pasengers will be better, then that's what they will do. If they think that lowering the fare will help them survive, then they will do that. Either way, each of us will have to make a decision on how we want to spend our dollars and what cruise experience we want.

I had suggested on a thread some months ago that perhaps HAL should just put some ships out of the water for a time, but was told that that is really expensive and many crew would lose their jobs.

[m steve]

if HAL jumps on the bandwagon and stops allowing smoking on the balconies I am sure many will join us and sail another We no longer book X and see no need to book Azamara or Oceania to spend more to be lilited by their policies. Now HAL could revise their liquor policy and allow you to bring a bottle each and maybe their bookings would go up. Drinking in cabins or on balconies improves income at the bars, not reduces it. Just look at my bar bills.

[taxmantoo]

The economy being what it is, prices will fluctuate so that companies can survive. Each company has to decide how they will best adjust to meet the needs of both their shareholders and their clients.

 

In the cruise market, there is enough variety of cruise lines and prices to meet everybody's needs. Times change, prices change, cruise lines change and so we too, as customers, must adjust. Luckily for us, there is enough choice out there and we are free to spend our dollars wherever we see ourselves getting value for our money, whether that be lots of money or a little money, whether that be with HAL or someone else. It's always nice to have options.

[bellebaby]

The economy being what it is, prices will fluctuate so that companies can survive. Each company has to decide how they will best adjust to meet the needs of both their shareholders and their clients.

 

In the cruise market, there is enough variety of cruise lines and prices to meet everybody's needs. Times change, prices change, cruise lines change and so we too, as customers, must adjust. Luckily for us, there is enough choice out there and we are free to spend our dollars wherever we see ourselves getting value for our money, whether that be lots of money or a little money, whether that be with HAL or someone else. It's always nice to have options.

 

Great observation... agreed.

 

B

[hammybee]

Whether the fares are reduced to fill the cabins or the ship sails at significantly less than capacity, the quality will suffer.

 

Excellent point.

 

Goldman Sachs maintains its "sell" rating on both cruise operators ( RCL and CCL) and says it expects further net yield deterioration as travel indicators continue to show weakness.

 

The RCL situation is unstable according to the numbers.

 

Here's a link to today's article along with quotes from the editor of CC:

 

http://www.reuters.com/article/marketsNews/idINSP47749920090319?rpc=44&pageNumber=1&virtualBrandChannel=0

[pipedreams62]

I only started cruising in 2002 so would consider myself a rookie. I love HAL and I am addicted to cruising. It will really take alot and I mean ALOT for me to stop.

 

Thinking back.. Over the years the cruising experience has somewhat declined and most of that time was in a booming economy. The fares were basically the same 7 years ago as they are today. I guess what I'm saying is it has just been a gradual decline over the years and now everbody is blaming the economy.

 

My first two HAL cruises the Maitre'd came to the table every evening and spoke with us for 15-30 minutes.We wanted for nothing (we're extremely

low maintenance) we just had great conversations. Asap on the Volendam was our maitre'd in 2002 NOBODY will ever fill his shoes.

 

The next cruise was on The Zaandam same thing. The Maitre'd came around every evening,to check on us. We always made sure to tip the maitre'd at the end of the cruise.

 

My next three HAL cruises we saw the maitre'd the last night of the cruise (he just wanted to make sure everything was okay,on the LAST night)

 

I don't know why a Maitre'd wouldn't work the room and finish the trip with a pocket full of envelopes? Just part of the decline I guess.

 

We always had a fun time with our waitstaff,exchanging emails,great conversation little magic tricks. Now there's very little talk,only because I think they're run ragged.

 

When it's shorts and t-shirts in the dining room,and people bringing their own booze,I'll probably pack it in.

[DFD1]

I think he is right. Much of HAL's revenue comes from on board spending. In order to keep that revenue steam running, HAL has to have the passengers.

 

HAL management has the responsibility to generate the cash flow necessary to keep the company viable, to keep as many employees paid as possible, and to realize the best possible return on their investment in the fleet.

 

Mothballing part of the fleet would damage the company, cause significant layoffs, and cause a loss of confidence on the part of the cruising public and in those who invest in Carnival stock.

 

IMO, HAL will monitor each market they serve (Alaska, Caribbean, Europe, Etc) and cut only where necessary, and when/if this debacle passes they will attempt to gradually restore service and fares to more attractive levels.

 

Arison, Carnival's chairman, knows this game well. I would not want to second guess him.

 

For Celebirity to run half full seems foolish to me.

[Sage]

Brian thank you for starting this most intersting thread. The concept of "filling the ship" is beginning to take its toll, and that is why I'm looking more fondly at Crystal.

[hammybee]

 

Thinking back.. Over the years the cruising experience has somewhat declined and most of that time was in a booming economy. The fares were basically the same 7 years ago as they are today. I guess what I'm saying is it has just been a gradual decline over the years and now everbody is blaming the economy.

 

Cruise lines will charge as much as the market will bear, at any point in time.

 

The price of a typical 7 day cruise in the majority of cabins is about 60% less than it was 20 years ago, based upon the relative value of the USD, over time. During that same time, the in cabin experience has substantially improved.

 

While prices declined, over time, the cost represents a greater percentage of most passengers' disposable incomes.

[CDRMark]

http://www.cnbc.com/id/29677718

Seems appropriate att.

Cheers

Mark (Not affiliated with CNBC, but a GE shareholder :) )

[bellebaby]

http://www.cnbc.com/id/29677718

Seems appropriate att.

Cheers

Mark (Not affiliated with CNBC, but a GE shareholder :) )

 

News to me, but will watch. Thanks for the information.

 

B

[jmps]

"On the flip side, Holland America's Stein Kruse countered: "It's simple. Not filling our ships does not make sense; our business model is based on [filling ships]."

 

I don't see this course of action by HAL in Alaska for veranda categories and above. HAL is holding firm on pricing and still has availability. Princess has been agressively pricing their product. I prefer sailing with HAL. But, as a previous poster said, "Mr. Wallet" won and I will be sailing with Princess.

 

B

 

This is what I have found on our first HAL cruise I booked. Prices for our cruise (Zuiderdam r/t Vancouver June 13) have not come down. I never sailed to Alaska before and find the prices very high. High enough we may cancel.

[hammybee]

Brian thank you for starting this most intersting thread. The concept of "filling the ship" is beginning to take its toll, and that is why I'm looking more fondly at Crystal.

 

Crystal has some incredible deals, deep discounting and $1000 OBC for certain cruises and more, designed to fill their ships, at any cost, too.

 

For those who are willing and able to pay more to get more, there are so many values out there, right now.

 

What we are not likely to find however, are a lot of luxury cruises departing on round trips from U.S. ports for 7-10 days. These cruise lines have made a business decisions to not compete with the mass market, in hyper-comeptitive U.S. markets.