INSIGHT: Agents hopeful that Regent's move to pay on NCFs sparks a trend

By Johanna Jainchill

MARINA DEL REY, Calif. -- Travel agents at Regent Seven Seas' first top producers meeting wondered if the luxury line's decision to pay commission on port charges, government fees, taxes and included shore excursions on all 2010 cruises could set a new benchmark.

The move is a huge reversal of a near-universal commission structure that the cruise industry follows, which separates the price of a cruise into a series of line items, many of which are not commissionable.

By bundling its 2010 cruise prices into one price, except for the included cost of air, Regent virtually eliminates all of the noncommissionable fees that travel agents have long railed against.

"If they can shift market share as a result of this, the effect could be that other cruise lines may follow suit," said Howard Moses, president of the Cruise Authority in Atlanta. "It would be the pendulum swinging back to how it used to be with commissions. The NCFs made a lot of cruise-only agencies jump into selling land tours."

Regent also is hoping that the move will shift market share in its direction.

"We think it gives the agent one more reason to sell us versus the other guy," said Mark Conroy, Regent's president.

Regent is a relatively small player in the industry overall, but it is one of the largest in the luxury sector. In addition, Regent is a sister company to Oceania Cruises, and its parent company, Apollo Management, also owns NCL Corp.

If Regent can move market share in the luxury cruise segment as a result of this move, agents here wondered if larger cruise lines would look to do the same, especially in a down market.

MSC Cruises for several years has paid commission on items that traditionally were not commissionable, like airfare and shore excursions, but it has struggled to grow market share, mostly because the Italian cruise line is still relatively unfamiliar to the U.S. cruise market.

Travel agents said that a good agent puts the client where they belong. 

"I applaud Regent, but you should always want to put your client on the ship that's right for them, not the one that pays the best commission," said one top producer here.

"But if Regent is right for them, this would help me steer them in that direction."

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