SAN FRANCISCO -- Carnival Cruise Lines does not intend to pay
Internet travel firms full commissions for cruise bookings made
completely electronically by customers via Web sites, said Bob
Dickinson, president of the line.
Speaking at the eTravel World conference here, Dickinson said if
a cruise is booked on a travel site with no human contact involved,
the on-line company should not receive the same level of commission
paid to traditional brick-and-mortar agents.
"Our vision is that if it's an Internet booking that ends up
getting touched by the travel agent and serviced in some way by the
bricks part of the clicks, we will pay a full commission,"
Dickinson said.
He said that on cruise bookings with no human contact -- and
which simply flow from a Web site directly into Carnival -- "our
goal would be to pay a transaction fee."
He did not elaborate on how much "touch" would be required to
receive a full commission or what the transaction fees would
be.
Dickinson was clearly targeting the numerous new on-line travel
firms that have approached Carnival to promote and sell cruise
products on line.
He predicted that Wall Street's plunge during the last two weeks
will reduce the number of those companies.
Nonetheless, he said, "We're seeing four or five dot-com
companies a week coming to us all saying they have the silver
bullet with one unique selling proposition that will allow
customers to ignore the rest of the Web and that they can do an
excellent job selling our product, providing we give them high
commissions and invest in their company.
"Some of the dot-coms are saying they are going to have great
booking engines to drive the cost of making the booking way down.
But they want the full commission.
"It shouldn't be at a full commission when coming through a
booking engine on a Web site. The dot-com models are assuming that
cruise lines are going to pay full commission and not a booking
fee."
Also on the panel was John Martinen, president of Denver-based
Vista Travel Ventures, who agreed with Dickinson.
"If you've got a lot of hands-on work, you've got to pay a full
commission," said Martinen. "But if [the booking] is going to flow
all the way through without anyone doing anything for it, we would
have to take a look at what's going to be given in terms of
commission because at that point you are going to be using a lot of
our resources to create this booking."
However, Martinen said it is too early to discuss a commission
vs. transaction fee strategy.
Dickinson was asked if the on-line agencies' offering
all-electronic bookings would entice the cruise line to lead people
to the lower-cost source rather than brick-and-mortars that receive
higher commissions.
"If you are an airline, you can have the philosophy of screwing
travel agents. There's no alternative to getting somewhere except
to fly. But if you are a supplier, if you are a non-zero sum game,
you have all kinds of alternatives to cruises, and you are relying
on travel agents for 95% of your business. Today, 5% of business is
direct with much lower acquisition cost than [working with] agents,
but we're not about to undercut 95% of our business."
However, Dickinson also predicted that Internet cruise bookings
will surge.
"My guess is that the prevalent purchaser is going to be so
wired that the [business] models are going to change. There's going
to be a much higher percentage of nontouched [nonagent involved]
business," he said. "[The Internet is learned] in grade school and
high school; why would [clients] go to [an agent] when they can do
it themselves?
"If that's everybody's mission, it's important that five years
from now -- if agents are still in the loop -- that somehow they
have created a Web site rich enough and accessible enough that
people are driven to it."