Cruise Lines Should Target Their Most Profitable Customers

[Huddler]

ALL cruiselines are concerned about one thing: Full Ships.

 

When they sail with empty cabins' date=' the expected average revenue per cabin is lost.

 

Unless they keep the "perks" process generally "democratic", they will lose cruisers...... The first to go will be the bread-and-butter cruisers and new cruisers...who will change to a line where they can at least look at a goal for more perks and the disparity isn't so obvious.

 

While the big spenders are a plus to the bottom line, the other 80% of the ship, who are on a budget, spend more as a group.......

 

The math comparing "big spenders" to moderate spenders would show revenue from the more moderate outstrip those who throw money around...

 

It's not that one is better or worse than the other. It's simply a fact that, with full cabins, they will make money. I don't think they care where the money comes from....[/quote']

I agree that they cant afford to abandon the lower value cruiser without the danger of lower occupancy rates. So, they should keep in place the loyalty programs that currently exist. But additionally should have hosts reach out personally to the higher profit customer with better perks and comps. Casinos send out mass mailings to their previous customers all the time. But they also have hosts who establish relationships and offer better comps to the high rollers. Those comps and perks arent published anywhere and nobody knows what the casino is giving me. They might have an 8 ball of coke and a dozen asian hookers waiting in my room for all anyone else knows. Better deals for high end customers wouldnt be published so why would any of the "little people" leave the line?

 

BTW, 100% occupancy does NOT make guarantee a profitable cruise. At least that is what I got from the Peter Greenberg special last night.

[librarylady19]

I recently came off the Solstice and observed exactly the same thing in regard to drink prices. One bottle of beer was $7.38, and one Martini was $11.50.

 

I don't mind paying certain mark-ups for things, but $7.38 for something that costs the cruiseline probably .30 wholesale is absolutely ridiculous. I just could never support and encourage that.

 

I actually just give myself a threshold for things (price-wise) and don't go above that threshold. For example, I think $3.00 is reasonable for a beer when I go out somewhere - considering their overhead and operating costs, etc. I don't buy drinks onboard, simply because they have raised and raised and raised their prices... to the point where, now, $7.38 for a beer and $11.50 for a martini is just beyond reasonable. Believe me, they will keep raising their prices as long as people keep paying them... soon it will be $10 for a beer.. then $12.. then $15... where will it end? For me it ended after it crossed the $3 mark (about 5 years ago).

 

 

- Rick

Rick,

If you've frequented bars and restaurants in major metro areas, you would realize that the markup is not tremendous on drinks on cruises. In Chicago, the average prices are similar (I'm not talking in dive bars but nice places) and same for Vegas. You are paying for more than the drink, you are buying the ambience and the service too.

We spent roughly $240 on drinks on a 4 nighter and didn't get drunk once but didn't find the prices unreasonable. Most drinks were tasty and well-made. I still don't understand why Celebrity has different rules for wine than beer and liquor - anyone know?

[Huddler]

No offense taken, at least here. In fact, I enjoyed your post when taken in the spirit that it was intended. Just one question; exactly how tight is a crab's ass in cold water, & how does one go about measuring it:D?

LOL. I dont know the origin of that southern colloquilism. My grandmother taught me dozens and dozens of them growing up by just being around her. A Lot of them I dont know what they mean, but they just come out in my conversation at the appropriate time. I still surprise my wife with them occasionally, and her being from Chicago, has no clue whatsoever as to their meaning or origin. :D

[Karynanne]

Ive never sailed on Celebrity but have a Baltic Cruise booked for next summer. This year I am taking the wife and kids on the Disney Cruise after spending 3 days in Disney World. Unfortunately for me, they dont have a casino on Disney as I love to gamble. After my cruise on Celebrity, I will let you know whether I am invited into the high roller club, ok?

 

Contact the Casino Host/Hostess, and ask to be rated.

[packercruising]

"CHEAP" can also mean "NOT STUPID" :D;)

 

Not according to my kids.:rolleyes:

[Cruising Carol]

I do on the ship what I do at home. I don't drink or gamble at home. On the last trip to Las Vegas for a family reunion, I didn't even put a quarter in a slot machine. For our upcoming cruise, the travel agent is sending two bottles of wine. That will do for all 20 days. So be kind to us "miserly old curmudgeons" -- it's due to our upbringing by the great depression survivors! And we think of ourselves as frugal or thrifty rather than miserly!

[Cruisin' Chick]

My husband has been wondering the same thing for years.

 

We don't smuggle on alcohol, wine, water, etc. We buy them on the ship, we gamble in the casino, we go to the Speciality Restaurant, etc. etc. I think on our last Constellation cruise we put our Martini Bar bartender's kid through college.

 

My husband always wondered if they track how much people spend on board, and if not, why don't they? Because that's where they make a good chunk of their profits.

 

Isn't it amazing how we are so different, yet have similar screen names. We don't gamble, go to the speciality restaurants, and rarely buy drinks (I tend to get migraines from drinking booze). I stay far away from art auctions and bingo games.

 

I think it's like those grocery store reward cards. When your card is swiped in the market, the store is gathering information about your shopping habits. Same thing with your cruise card.

[Huddler]

I do on the ship what I do at home. I don't drink or gamble at home. On the last trip to Las Vegas for a family reunion, I didn't even put a quarter in a slot machine. For our upcoming cruise, the travel agent is sending two bottles of wine. That will do for all 20 days. So be kind to us "miserly old curmudgeons" -- it's due to our upbringing by the great depression survivors! And we think of ourselves as frugal or thrifty rather than miserly!

Oh, I understand "frugal", "thrifty", and "cheap". My Aunt and Uncle have more money than Jed Clampett, but they will argue with the waiter or the grocery store clerk over a nickel. They spend more time worrying about how they can save money or game the system, than they do about relaxing and having a good time. I love them both dearly, but they cannot travel with me. Never going to do it, and they are avid cruisers, btw. Being that absurdly miserly robs me of the joy of my vacation. I have a very stressful job and work hard for my money. When I am on vacation, I dont want to worry about anything, particularly if me and my wife can split the blue plate special just so we can save a $1. Or whether I can use this expired coupon to screw some business out of a free taco. Thats just not me. If that is you, more power to you, but you cant hang out with me either as you will be the penultimate buzz kill.

 

Again, for those who get easily offended. Dont. Just dont. I am talking about me, and my family, NOT YOU. I dont care about the depression or how you paid a nickel for a gallon of gas during the Hoover Administration. Not trying to be disrespectful, I am just saying that not all people who are now, or have been poor at one time, are cheap. Cheap FOR ME is not a fun way to do a cruise. We get one shot at life. I intend to enjoy mine to the fullest. Its the way I have always been. Travel for me is about fun fun fun til her Daddy takes the T-Bird away. When on a cruise I am going to get whatever I want when I want it, and not penny pinch and not care a tinkers dam about what I spend. And I am going to surround myself with people who also enjoy all life has to offer without stiffing waiters for the tip or carrying around a calculator to keep a running total of their expenditures. I am going to sleep as little as possible. I am going to be the ultimate bon vivant and see things and soak it all in without a care for saving every red cent. Many call that stupid, or frivalous, or a spendthrift. And thats ok, but notice I certainly dont get my panties all twisted. Different strokes baby! But my strokes are alot more fun than most!!

[j!m]

i'm with you huddler

 

if you have to worry about the cost of a drink etc thats not the way we like to travel

 

imo X doesnt really have a loyalty program they offer no perks at all that have any interest to us

 

having said this i do understand their problem, they need to try to fill the ships so cutting costs in an effort to provide lower pricing is necessary and given this scenario it is unlikely they would offer any perks (or comps) that increase their costs

 

do i think customers who spend more should get more? of course i do! but that hasnt been the case so far. and we have NEVER been contacted by any representative of X to encourage us to take any particular cruise.

 

wouldnt it be nice if we were offered a bottle of wine one night or a drink while playing craps? sure it would and we would appreciate it but it doesnt happen and isnt going to

 

and yes we do receive a bottle of sparkling wine and those coupons but we dont like that wine so we give it to the butler and the coupons are of no value to us. we would much prefer a jar of dom or vive and they can keep the coupons

 

not complaining, we enjoy our cruises (and the X product) and have a couple more booked but are not expecting any encouragement from X any time soon

 

i dont know what the "right" answer is but in the current economic situation, my guess is perks with a cost are not in the cards cost (service) cutting and price reductions are

 

they cant have the ships sailing below capacity for very long, operating costs are the same whether the ship is full or half full

 

and btw the comps vegas offers come with a price yes they will give you dinners and a room but.......... you gotta play. if you are going to play anyway thats fine, thats the cost of the trip! they didnt build all those big hotels by losing money!

[Longboysfan]

LOL. I dont know the origin of that southern colloquilism. My grandmother taught me dozens and dozens of them growing up by just being around her. A Lot of them I dont know what they mean, but they just come out in my conversation at the appropriate time. I still surprise my wife with them occasionally, and her being from Chicago, has no clue whatsoever as to their meaning or origin. :D

 

She probably thinks your living in a parallell universe.

[lysolqn]

With so many other competing cruise lines and land vacations options available today, what makes you think the "big spender" wont move to another cruise line or choose a land vacation? My entire post was designed around that: use hosts and comps to encourage the most profitable customers to come back on board and prevent them from spending all that potential revenue somewhere else. Take me for example. I have cruised several lines with no regard to brand loyalty. Why not have a "host" reach out to me on a personal basis and encourage me to come back. Have them find out where I am interested in going next, and then keep in contact about cruises that I have shown some interest. Make me feel like I am a VIP. Casino's do this all the time with great results.

 

You offered some interesting food for thought in your initial post but after reading your subsequent posts, your agenda seems to be nothing more than a campaign to "Vegas-ize" the cruise industry so "big spenders" (like yourself?) can be made to feel more important than they really are by having their egos stroked. I sure hope the business plan you are proposing for the cruise industry never sees the light of day, for I can't imagine being on a cruise on which pax and crew are forced to pay homage to self-annointed VIPS. Sorry to disappoint you, but unlike in Vegas, the only "whales" most people care about on a cruise are in the water. Happy cruising!

[Rick-cruiser]

Rick,

If you've frequented bars and restaurants in major metro areas, you would realize that the markup is not tremendous on drinks on cruises. In Chicago, the average prices are similar (I'm not talking in dive bars but nice places) and same for Vegas. You are paying for more than the drink, you are buying the ambience and the service too.

We spent roughly $240 on drinks on a 4 nighter and didn't get drunk once but didn't find the prices unreasonable. Most drinks were tasty and well-made. I still don't understand why Celebrity has different rules for wine than beer and liquor - anyone know?

 

Hi Sandi,

 

Yes I have frequented many bars and restaurants in metro areas, all over the world, and I must respectfully disagree.

 

I know for a fact that there is a TREMENDOUS markup of drink prices - both in landbased bars and in bars aboard a cruiseship. I know this because I was a bartender and I know precisely what that bottle of beer cost (.30) and what the markup is (2000%).

 

And also I would certainly not use that same analogy and thought process when comparing price markups of drinks between bars vs restaurants…

At a restaurant, you’re not only paying for the ingredients of the meal, you’re paying for the chef’s talents and expertise, the time it takes in preparing/cooking the meal, the ambience/atmosphere of the restaurant, the 2-3 hours you spend dining there, and the continuous service from the wait staff throughout that period of time.

 

When ordering a drink, the bartender puts some ice in a glass, pours the liquor, and hands you the drink. Boom…it’s done.

 

 

So, personally, I don’t give exactly the same considerations, when comparing costs vs. what-you-receive, between getting a drink handed to me in a bar - compared with dining out somewhere…...

 

But that’s just ME… and I know I might be a lot different than most people out there… :)

 

- Rick

[lysolqn]

Hi Sandi,

 

Yes I have frequented many bars and restaurants in metro areas, all over the world, and I must respectfully disagree.

 

I know for a fact that there is a TREMENDOUS markup of drink prices - both in landbased bars and in bars aboard a cruiseship. I know this because I was a bartender and I know precisely what that bottle of beer cost (.30) and what the markup is (2000%).

 

And also I would certainly not use that same analogy and thought process when comparing price markups of drinks between bars vs restaurants…

At a restaurant, you’re not only paying for the ingredients of the meal, you’re paying for the chef’s talents and expertise, the time it takes in preparing/cooking the meal, the ambience/atmosphere of the restaurant, the 2-3 hours you spend dining there, and the continuous service from the wait staff throughout that period of time.

 

When ordering a drink, the bartender puts some ice in a glass, pours the liquor, and hands you the drink. Boom…it’s done.

 

 

So, personally, I don’t give exactly the same considerations, when comparing costs vs. what-you-receive, between getting a drink handed to me in a bar - compared with dining out somewhere…...

 

But that’s just ME… and I know I might be a lot different than most people out there… :)

 

- Rick

 

And unlike many restaurants and bars, X's parent company, RCI, has the advantage of economy of scale when purchasing anything - including booze - for umpteen ships at a time, thereby increasing the profits of bar sales.

[richsea]

How long ago was the wholesale cost of a bottle of beer $.30?

[Cruisenouvelle]

Oh, I understand "frugal", "thrifty", and "cheap". My Aunt and Uncle have more money than Jed Clampett, but they will argue with the waiter or the grocery store clerk over a nickel. They spend more time worrying about how they can save money or game the system, than they do about relaxing and having a good time. I love them both dearly, but they cannot travel with me. Never going to do it, and they are avid cruisers, btw. Being that absurdly miserly robs me of the joy of my vacation. I have a very stressful job and work hard for my money. When I am on vacation, I dont want to worry about anything, particularly if me and my wife can split the blue plate special just so we can save a $1. Or whether I can use this expired coupon to screw some business out of a free taco. Thats just not me. If that is you, more power to you, but you cant hang out with me either as you will be the penultimate buzz kill.

 

Again, for those who get easily offended. Dont. Just dont. I am talking about me, and my family, NOT YOU. I dont care about the depression or how you paid a nickel for a gallon of gas during the Hoover Administration. Not trying to be disrespectful, I am just saying that not all people who are now, or have been poor at one time, are cheap. Cheap FOR ME is not a fun way to do a cruise. We get one shot at life. I intend to enjoy mine to the fullest. Its the way I have always been. Travel for me is about fun fun fun til her Daddy takes the T-Bird away. When on a cruise I am going to get whatever I want when I want it, and not penny pinch and not care a tinkers dam about what I spend. And I am going to surround myself with people who also enjoy all life has to offer without stiffing waiters for the tip or carrying around a calculator to keep a running total of their expenditures. I am going to sleep as little as possible. I am going to be the ultimate bon vivant and see things and soak it all in without a care for saving every red cent. Many call that stupid, or frivalous, or a spendthrift. And thats ok, but notice I certainly dont get my panties all twisted. Different strokes baby! But my strokes are alot more fun than most!!

Me ! Me! Me! It's all about ME!!! Thanks for a most amusing post. To your credit, you did use 'penultimate' correctly.

BTW, YOU opened the door to feedback by posting here, so you can't turn around and tell posters 'Don't. Just don't' (get offended). As I'm sure you know, you can't have it both ways. I 'can't hang out with' you? Best news I've had all day ! It's the penultimate, baby !!!

[Huddler]

You offered some interesting food for thought in your initial post but after reading your subsequent posts, your agenda seems to be nothing more than a campaign to "Vegas-ize" the cruise industry so "big spenders" (like yourself?) can be made to feel more important than they really are by having their egos stroked. I sure hope the business plan you are proposing for the cruise industry never sees the light of day, for I can't imagine being on a cruise on which pax and crew are forced to pay homage to self-annointed VIPS. Sorry to disappoint you, but unlike in Vegas, the only "whales" most people care about on a cruise are in the water. Happy cruising!

Where did I mention that pax and crew should be forced to pay homage to me? Wow! Many illogical conclusions being jumped on here. I couldnt care less what others care about on their cruise. My point was based from the perspective of how a business should market to their most profitable guests. Yes, they should reach out to the big spenders. yes, they should reward them for their direct impact the "whales" have on the profitability of a cruise. No where did I mention how they should be treated or viewed while onboard.

[cruzendude]

I'm with Huddler on this......I too don't sweat what I spend on a cruise although I was raised VERY misery (YES I SAID MISERLY:p) and sometimes my instinct when ordering in a restaurant is to sit there wondering whether an extra dollar is worth it for one thing over another and then when I'm driving home I will stop by Best Buy and drop $4000 without even thinking twice....I KNOW it doesn't make sense but hey, its me! :(

 

Now for those who kept posting "how would they track it" you all should know that those cards you buy EVERYTHING onboard with has all of your purchases on it so Celebrity already knows exactly what you and I spend and exactly what we buy onboard, so YES I would like some comps, deals, coupons or whatever because when my 7 day cruise onboard bill is $1200 (after my $200 credit) then I am obviously a more profitable customer than many others...its not eliteism its BUSINESS....just the ways things are done...

 

I'm not saying that I would demand such things but if I did get them on one cruise line and not on others then my loyalty would be with the line that rewards my patronage.....

 

I know $11.50 is too much for a martini but I like them so I buy them....

 

I KNOW my food is already paid for but a special dinner in Murano with champaine and tip was $180 but I enjoyed myself.....

 

its my vacation and if I can afford it and I enjoy it then I will get it.....if I couldn't afford it it would be a different story but I would still cruise and not begrudge others for splurging more than I am able to....when I retire we most likely will do LOTS of cruises and not be able to splurge but I will still have fun and not complain if others spending more than I are treated differently....though I might buddy up to them hoping they buy me a martini! :p

[WineDown17]

Huddler-

 

Your post was a fun read.. I dont take life too seriously, same for your post. It was pretty fun reading... With some interesting points.

 

Not sure how it seems to have become a class warfare thing..The economy has many touchy, and that is understandable... actually, money is always a toucht subject.. any hoo...

 

I share many of your views.. I dont get to vacation as frequently as I would like, and when I do, I splurge.. I dont have time to splurge on myself when home... My mother died at 40.. carpe diem..

 

I also repsect those who may chose to spend their money differently.. as you say different strokes. We all live by different value systems. But the scuttlebutt is par for the course here. So I too, got out the popcorn !!(whoever posted that one- I LMAO)

 

Perhaps your idea, said another way is that as someone who does spend a fair amount in "extras" (profit centers) that the lines provide differentiated perks for you, (and similar passengers) that you would value and which also further enhance their bottom line.. quid pro quo Clarice..... everyone wins.

 

I am just not so sure their informatics are savvy enough to get them there. One would hope.. They clearly have the data...but extracting data and then having the analytics capabilities to convert it into actionable, and potentially profitable information are 2 entirely different things.. and something even many fortune 100 companies still lack sorely....

 

Maybe a more near term approach would be a "choose your rewards" program... different types of perks for different strata of cruisers... which the passengers self select..eliminating the need for an investment in informatics capabilities... Not ideal.. but better than trying to please everyone and missing the mark 80% of the time.

 

X- If you are reading this- you can hire me.. I can help you here. :) Otherwise see you in May!!

[WineDown17]

OOH.. another idea.. increasing rewards on board as folks spend.. something along the lines of:

 

1st $500- no perks other than standard coupons, etc

$500-999: 10% off purchases

$1k-2K: 15% off

2k-5K: 20% off..etc

 

The levels would vary by length of cruise, etc..

 

Kind of a spend more, save more.... (I know- technically you arent saving, you are spending.. but it works in other industries.. just a thought.)

[Shirley and Les]

Regardless of how much anyone spends on a cruise, each cabinful of passengers are small fish in a large pond. Think about the following;

..........Assume a cruise line has 10 ships

..........Each ship has 1000 cabins

..........Each ship goes on 50 one week cruises each year

.........That works out to be 500,000 cabins each year

 

So each cabin on each sailing represents 0.0002 percent of the line's annual profit if each cabin contributes equally.

 

Okay, you're a big spender so we will triple your contribution to profit. It's now 0.0006 percent per cruise.

 

Oh, you take three cruises per year. Wow, your contribution to profit is now 0.0018 percent. Are you starting to feel like a mouse starting a fight with the cat? ;)

 

I think the cruise line better be looking at filling all the cabins rather than

looking at the spending habits of individual passengers.

[usha]

Shirley & Les, I think you really put things into perspective!:)

[Huddler]

Regardless of how much anyone spends on a cruise, each cabinful of passengers are small fish in a large pond. Think about the following;

..........Assume a cruise line has 10 ships

..........Each ship has 1000 cabins

..........Each ship goes on 50 one week cruises each year

.........That works out to be 500,000 cabins each year

 

So each cabin on each sailing represents 0.0002 percent of the line's annual profit if each cabin contributes equally.

 

Okay, you're a big spender so we will triple your contribution to profit. It's now 0.0006 percent per cruise.

 

Oh, you take three cruises per year. Wow, your contribution to profit is now 0.0018 percent. Are you starting to feel like a mouse starting a fight with the cat? ;)

 

I think the cruise line better be looking at filling all the cabins rather than

looking at the spending habits of individual passengers.

Good point. Now lets extrapolate that .0018 over 1,000,000 customers per year. As the CEO, would you rather have those million people on average spend $250 onboard or $2500 onboard? Do you see what a HUGE number that turns into as opposed to saying .0018? The difference in profitability between those who dont spend onboard and those who do is absolutely staggering and could mean the difference between success and failure of the business. I am just looking at ways the cruise companies can increase revenues. Getting a more profitable customer onboard is one way to help ensure the viability of the line. Thats all.

[J & G]

 

its my vacation and if I can afford it and I enjoy it then I will get it.....if I couldn't afford it it would be a different story but I would still cruise and not begrudge others for splurging more than I am able to....when I retire we most likely will do LOTS of cruises and not be able to splurge but I will still have fun and not complain if others spending more than I are treated differently....though I might buddy up to them hoping they buy me a martini! :p

 

We're retiring soon....can I please cruise with you? I'd love to be treated to a martini....:D

 

On a serious note, I don't think it's how people spend their money that's at issue here....it's how they look on others who have different spending habits and priorities.

 

And BTW, it's a bit early for popcorn, but it's poppin'.........:p

[dadsbdaycruiser]

I think some cruise lines are targeting this.... I was sent a questionnaire from NCL a year or so ago, and the real objective of it was figuring out how much we would spend on gambling onboard (I guess my $20 at the slot machines wasn't enough) and the implication was that if I spend X dollars onboard we'd get a free cruise... so it does appear that some lines do value this, if it is substantial enough.

 

Alcohol is a bit of a double edged sword. They want people ordering expensive wine and a few pricy drinks during the day or in the disco at night. However, they don't want drunk and unruly customers... as this is disruptive to everyone onboard. So I don't see them offering free trips to "big drinkers".

 

Shore excursions are a big deal... I think this is one of the big areas of focus and profits. We are going to Alaska and could easily spend more on excursions (if we booked them through the ship) then we did on the cruise. They have to be loving this.

[bobbyleduck]

Every time I see a thread such as this, started by a brand new poster, who says I've been cruising for years, spend a ton of money and deserve more for my money, my initial thoughts are - PLANT!:confused:

 

This thread is nothing more than a very obvious attempt to find out how many people will travel more if they're offered certain perks if they spend more money. It's another cute way to get information.

 

Here's a thought for the cruise industry. Quit building so many huge ships.:mad: Build fewer ships and smaller ships, then offer those fewer available berths to all of the people who have more money than brains:D and see if you can fill them. I bet you can jack the price up by more than triple:eek:, and really pull in the big bucks, afterall, those rich:cool: people won't have to share their space with those of us who either have less money, or are a bit more frugal with our limited vacation dollars.

 

Happy cruising to all!

 

Bob