Changes to Princess pricing policies aims to help agent sales

By Tom Stieghorst

Princess Cruises has made a number of changes to its pricing and sales policies that were sought by travel agents and designed to improve partner relations.

Among the changes, agents will be able under certain circumstances to offer onboard credits of up to 10% of the ticket price, funded by the agency, in order to facilitate a sale.

The change to Princess’ advertised price policy amends one of its “value add” promotion options so that agents will no longer have to seek pre-approval from Princess to offer the credit, so long as it is offered on a promotion applicable to an approved fare.

Brian O’Connor, vice president of North American sales for Princess, said the change isn’t intended to promote commission rebating, although that might be one result. He said Princess doesn’t condone rebating but concedes that a formal policy forbidding it is virtually unenforceable.

“I get asked this question a lot,” he said, “We do have an advertised price policy, and all agents are required to adhere to that policy, which is you have to promote the fares that we put out there.”

But being more flexible about onboard credits will make Princess more competitive, O’Connor said.

“We’re going to give it a run,” he said. “We are going to monitor it. We do hope our partners will use it selectively, when they need it, and not necessarily as an ‘always on sale’ kind of tool.”

Princess is also giving passengers more time to take advantage of incentives to book future cruises while on their current cruise. The incentives, which include reduced deposits and onboard credits, will be available for 60 days through agents after completion of a cruise.

Princess has also changed its forms so that agents of record are automatically credited with onboard bookings. Previously, passengers had to opt in to get the booking registered with their agent.

O’Connor said more agents need to take advantage of the future cruise program. While such bookings make up 20% to 30% of sales at some agencies, which send their clients with prepackaged forms to present to the future cruise desk, others are less organized about it.

Princess is also giving its field sales managers the discretion to offer amenity points to win group business away from competitors, rather than having the decision made by yield managers at Princess headquarters, who often turned down such requests.

“The general consensus was we always delivered a no,” O’Connor said. “I presented the case that we were missing an opportunity to grow the business by having the decision take place out in the field.”

Also, Princess will provide itemized details about on onboard credits passengers are to receive in the shipboard folio at the start of a cruise, a change to give passengers more transparency.

Princess will also mail the Captain’s Circle quarterly newsletter to top-producing agents. That will serve to keep agents up to date with what clients are being told by Princess, and also curb electronic information overload, O’Connor said.

Several IT changes were also made. Agents will be able to trigger deposit confirmations and final payment notifications electronically through Polar Online.

And the confirmation text has been boiled down to two pages.

O’Connor said the changes were the initial ones he made from feedback received at sales meetings and agent conventions over the past year. Most of the changes are in effect now, but they will really gain traction in 2014, O’Connor said.
 

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