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Cruise line price scare: Just how dumb do they think we are?

cruise line price scare
Just last month, Norwegian Cruise Lines issued a cruise line price scare, what people in sales term a "call to action", telling us that starting April 1st, prices would go up. Being the nice folks they are though, Norwegian also extended a current sale until the end of the month, just to give us the chance to get in on a good deal. At the time, we called foul. You did too. Now, the line has added another "sale" that lets us in on even a better deal. As my dad might have said if I told a lie as a little boy "I ain't buyin' it."
To help cushion the blow of a 10% price increase scheduled for April 1st, the line extended their current promotional offers until the end of March in a "we're tough, but we're fair" sort of way.

"We wanted to give consumers and travel agents the opportunity to take advantage of these offers before the price increase." said Norwegian Cruise Line CEO and former Undercover Boss Kevin (Sneaky) Sheehan.

At the time cruise industry expert Stewart Chiron, CEO of CruiseGuy.com called it accurately saying "This is NCL's 2nd Annual April Fool's Cruise Sale. For some, it's a message of don't book NCL after 3/31 because you'll pay more."

Gadling noted then that cruise lines often promote a call to action for booking in a number of ways that seem to have a bit of strategic ambiguity built in.

"NCL made the same comments last year, but (the timing) followed Carnival's announcement that they were going to raise summer prices." added Chiron reasoning "They may be trying to generate additional attention for their possible future IPO."

Now, the line has added yet another "limited time promotion" to help us out.

In other words, the shocking announcement to buy now or pay dearly later did not work. However many cabins they had hoped to sell did not get sold. Now NCL feels the need to sweeten the deal with not just free upgrades but they're throwing in onboard credit too along with asking for a reduced deposit to get signed up.

Years ago I was in the restaurant business and you could always tell the places that were having a hard time. Those were the ones that did the "buy one, get one free" promotions or the "All you can eat" offers that their business models did not really support. It was not long before those places went out of business as their last hail Mary pass went uncaught.

Is that where Norwegian Cruise Lines is right now? Are they in serious financial trouble?

Probably no more than they traditionally are. The line has a long history of financial woes fueled by not the economy, not the competition but the fact that they are their own worst enemy.

Don't get me wrong, NCL does a lot of good things and have made efforts to put some real meat behind their claim of being innovative. This is not one of them.

An onboard credit plus reduced deposit strategy is a popular promotion that only a few lines do and they do it very sparingly. Royal Caribbean might have a "Wow" sale once a year, maybe twice, where they offer a 50% reduced deposit with some onboard credit. I know people that wait all year for that sale to happen because Royal Caribbean just does not do it often. Princess Cruises allows travel agencies to set up one-week sales, one each calendar quarter, to use in conjunction with ongoing and specific marketing strategies. Top-value line Carnival Cruise Line and all the rest, for the most part, never do.

NCL is just throwing spaghetti at the wall to see what sticks.

The cool part of all this is that you "ain't buyin' it" either.

The not-so-cool part is that moves like this paint a picture of the cruise industry as being a needy bunch that will stop at nothing to sell you a cruise. While cruise lines do need to sail full ships to be profitable, they're far from needy. Cruise vacations are a hot travel choice for mainstream America and a growing part of the world. Scare tactics should not be necessary.

The really-not-so-cool/kinda-scary part is that Norwegian seems oblivious to their operational problems that cause this need in the first place. That's scary when you think that they have a fleet of ships that sail around in the middle of the ocean with a whole bunch of human beings on board.

I'd like to have the confidence that they know what they are doing. You should too.

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Flickr photo by steamboatsorg

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