Last week, Norwegian Cruise Line divulged that more than one-quarter of its sales were made direct to consumers.
Because NCL is private, it does not have to offer such information. The company made the disclosure in documents it filed last week with the Securities and Exchange Commission, the first step in taking the company public.
Even though NCL said the majority of its sales come through travel agents and cited the “importance of the retail/travel agent channel,” agents voiced concern, in part because NCL not only said that 27% of its sales were direct but said it was growing that business "through investments in our brand and our website as well as increasing our direct-sales force,” and also because its growth has been fast.
"This direct-sales channel is at a significantly lower cost for us and has grown from 13.3% of our net ticket revenue in 2007 to 27% for the first nine months of 2010, and we expect to further increase our mix of direct business in the future," NCL said.
The controversy over cruise lines’ direct-sales policies is constant, with Carnival Cruise Lines generally taking the most heat for what agents often perceive as the cruise industry’s most aggressive direct-sales policies.
If agents directed business to cruise lines based on those policies, they would flock toward Costa Cruises and MSC Cruises. Neither has a genuine direct-sales policy. They also don’t have call centers.
MSC Cruises USA CEO Rick Sasso said that most of MSC’s in-house leads are shared with agents, “who can meet service follow-up requirements.”
Costa Cruises North America CEO Maurice Zarmati said direct sales are “so small, so insignificant, we almost don’t feel the direct business. 99.9% of the time we are talking to the agent, not the consumer.”
Are those lines rewarded with business?
“Agents respect our support, and although difficult to quantify, we do have loyalty for our efforts,” Sasso said.
Perhaps, but those lines have been fighting for market share for several years. And they concede that they’re able to avoid having direct-sales strategies because they are small players in the North American market.
“Eventually we will need to provide a link for customers to be able to book with us, and we will need to follow up on direct leads as this type of market share can not be ignored given the how our competition is maturing in this area,” Sasso said.
And as much as agents like to say they will direct their business toward lines they perceive as more “agent-friendly,” they know it is difficult.
“If it were apples to apples, I’d always sell lines with better policies,” said one agent. “But with cruises, it’s never apples to apples. They aren’t airlines — yet.”