Saturday, July 28, 2012

Get a Toaster With Carnival Cruise Deposit

 Value-Add Incentives for Cruise Bookings
 New Carnival Cruise Rules Start August 1st

What would you think if your travel agent gave you a toaster when you booked a Carnival Cruise?

Do you remember opening a bank account and getting a toaster?
If you do, don't admit it because you will be telling your age.

Value-Add Incentives

Definition: A value-add is a booking incentive provided by a travel agency that offers a value to
the consumer above and beyond what Carnival includes in the rate.

In lay terms, your travel agent gives you a gift to thank you for your business.  Prior to the rule changes which are about to take effect, this gift could have taken many different forms but was limited to a percentage of the cruise fare.  (I'll spare you all the gory details.)

New Rules

Effective August 1, 2012, value-add booking incentives may only be non-cash equivalent items and have a value equal to or less than USD 25.  What that means is you won't be seeing advertisements like the one above any longer.    An onboard credit (OBC) would have a cash-equivalent (as would bar coupons, photo credits, gas cards).

Cash-equivalent add-ons are no longer permitted.

Existing marketing plans that have had previous approval from Carnival, will be allowed to continue through the end of 2012, so some ads may not disappear right away.

What does this mean to the Consumer?

You could very well get that toaster from your agent.  Well, not really likely - but I think we've made our point.

After all, how many tote bags does one need?   After awhile, if you've been a faithful client,  your agent may run out of fresh ideas when they look for a welcome aboard gift for your embarkation day.

Bon Voyage bar credit and photo coupons (i.e. cash equivalent), airline miles, third party cash back offers, reduced or waived deposits, free or discounted insurance, free or discounted shore excursions, free or discounted hotel nights, reduced airfare, gift cards or anything that equates to a cost associated with the cruise are all banned.

Carnival believes they are leveling the playing field between all agencies, since value-add incentives were getting excessive in some cases.   So this should make it easier for consumers to compare "deals".

What does this mean to the Travel Agent?

It means their hands are tied.   For those guests that don't drink, and have been on many cruises, there are definitely fewer choices that can be used as a thank you gift.   The agency that offers the "best toaster" might get the business or guests that aren't concerned with personal service and advice, may just bypass the agents completely and book with the cruise line.   

(see examples of banned promotions above)

Carnival believes that this change is a step which ensures that all of their Travel Partners have the equal ability to sell their product at the same great rate.

What does this mean for Carnival?

Time will tell - one thing for certain, they better adjust their budgets for the downturn in bar credit and photo credit sales.

Obviously Carnival is attempting to control what the consumer pays for their cruise this way.  

It will be interesting to see what other cruise lines do in response.   It will also be interesting to see how passengers react to the changes.   They may not even notice the change for some time, especially first-time cruisers that have nothing to compare against.

Final Thoughts

We will continue to work with our guests to find them the best value for their vacation dollars.  We are happy that great service and advice doesn't fall under cash-equivalent value-add.   Maybe Carnival is right - once the prices are equalized, the only differentiation is service. Therefore we feel that we have an edge after all with these new rules.   We'll just have to be creative with thank you gifts now.

You still have a couple days to take advantage of our July OBC offer - if you want to book one last Carnival cruise under the old rules.

No comments: