Carnival Cruise Line is dropping the thresholds on its commission tiers, the first of what it promises will be a string of agent-friendly initiatives to be rolled out in coming months.
The move, which makes it easier for agents to earn more commission selling Carnival, is the kind of tangible action that many agents asked for in past feedback sessions.
"It's pretty substantial drops and it will have a real impact on an agent's ability to earn way more money with us," said Adolfo Perez, Carnival's vice president for trade sales and marketing.
As one example, agents will have to book only 250 sailed cabins to earn commissions at the 15% rate, down from 400 previously. Carnival said the sailed-cabin requirement to reach each tier in the 11% to 15% brackets will drop by an average of 32%.
The move largely reverses an action taken at the start of 2013 that raised the tier thresholds.
"There was a lot of analysis done. We hadn't changed them in 10 years," Perez said. "Over the last couple of years as we've been doing Carnival Conversations, we got a lot of feedback and have made changes along the way. This was something that had come up in those conversations, as well as conversations I had when I first started this job three months ago."
"This was something we really felt we needed to address. In order for us to show our commitment to the trade, we felt it was the right time," Perez added. "It continues to show we are supporting the trade and we continue to value them."
Some agents said the pendulum is swinging back at Carnival from what had been a less proactive policy toward the trade.
"Essentially, they are still repairing the damage from the Gerry Cahill years by reversing the changes he made to the commission model when he became CEO," said Don Baasch, owner of LastCallCruises, based in American Canyon, Calif. "So it will make some agents feel better about things."
Robin Smith, owner of Caladesi Travel in Hendersonville, N.C., said it should help many independents.
"In my opinion, Carnival has always been the best at gathering up all the 'little fish' and helping them grow. When they changed their structure, it really hurt some of them," Smith said.
"Additionally, it shows the effort Carnival is making to retrieve good partnerships with many agencies that may have 'stepped aside' from them during the last few years due to management, operational and policy changes," Smith added.
The changes will affect agents selling as few as 40 cabins, who will now qualify for an 11% rate. Previously, they had to sell 50 cabins.
Under the new plan, agents will have to sell 75 cabins to earn 12%, 125 cabins to earn 13% and 175 to earn 14%. The thresholds now are 100, 200 and 300 cabins, respectively.
The new structure does not completely revert to the 2012 levels when small agents could sell as few as 13 cabins to qualify for an 11% rate. And it doesn't affect large agencies.
Perez said the top tier level of 16% earned by many large producers and agencies that belong to major networks and groups remains unchanged. That threshold was set in 2013 at 1,000 cabins. "We feel that's the right place," he said.
He said Carnival's business development managers will be working with agents for the balance of the year to help them maximize their commission rate under the new structure.
The revised commission tiers are being positioned as the first step in a new trade-focused campaign called "Onboard with You," analogous to Norwegian Cruise Line's "Partners First" program or Royal Caribbean International's "Loyal To You Always."
As part of the campaign, Carnival announced it will create a Facebook page for agents, something Royal has had for awhile.
Perez will host the Facebook page, which will give agents the opportunity to engage with the sales team, learn about Carnival initiatives and "receive exclusive sales leadership insight," a Carnival announcement said.
New elements of "Onboard with You" will be introduced on an ongoing basis and highlighted on GoCCL.com, Carnival's online portal for agents, which will gain a new section dedicated to the initiative.
In addition, the Carnival team will share elements of the program during sales events in the field, Carnival said.
Carnival said "Onboard with You" will have several key tenets, including a formal pledge to agents.
The pledge states: "Carnival is committed to working with travel partners, will be accessible and engaged with the trade, will be focused on helping grow both new and past guest business, will recognize innovative partners and will seek feedback to ensure stronger travel partner relationships."