An independent has called on cruise lines to give all agents the same commission to stop online travel giants from heavy discounting.
Bob Lines of Knowle Travel and Midland Cruise Club said some of the larger online agents receive so much more commission than independent agents that they can afford to give away as much as 15%.
Speaking at the Advantage Latitude cruise conference in Amsterdam last week, Bob said that by giving the large online cruise agents higher rates of commission, suppliers were preventing independent agents from being able to compete.
“Cruise lines depend on new to cruise customers to grow their businesses and it’s the independent agents who are training themselves and encouraging clients to consider cruise, but then they are going to the big online agents to book because they are discounting so much,” said Bob.
“I know cruise lines can’t dictate how much agents give away, but if they paid all agents the same commission, say 12%, then the cruise lines couldn’t offer more than a 9% discount because they wouldn’t want to end up with less than 3%.”
Bob claimed that P&O Cruises slashed commission rates ‘overnight’ for its Gold and Platinum sellers, from a maximum of 18% down to 7%, after some were giving away as much as 14%.
“I don’t want the other cruise lines to come down to 7%, but if everyone was on 12% no-one, not even the online players would give away more than 9%,” he said.
“If cruise lines are going to continue to grow, that growth is all going to come from new to cruise customers, and the only way these customers are going to find out about cruising is by visiting their high street travel agent or their local homeworker, they don’t ring a call centre for advice, but the big cruise companies are giving them the tools to discount.
“I know of three aggressively commissioned cruise companies that are giving as much as 20% to the big online travel agents and we are only probably working on 15%.
“Half of our turnover is in cruising, about £3m a year, but we still don’t come into the same ballpark as the big online agents.”
In response to Bob’s plea, Princess Cruises’ UK VP Eithne Williamson, who was also attending the Advantage conference, said she wanted to see an end to ‘across the board’ discounting.
“I’d be all up for stopping the discounting and making sure there is a leveller playing field, but there are some restrictions on that.
“If we can grow the cruise business rather than trying to pinch each other’s business, let’s get more people cruising is what I would hope we could do.”
Oceania Cruises Director of Sales UK and Ireland Louise Craddock said: “It is our biggest frustration when we see our beautiful products being discounted, we have it written into our commercial terms that no-one can promote Oceania with anything more than a 5% discount.
“What an agent does with a client over the phone is out of our control, but what we can do is monitor how people advertise our brands, so if you do see something that is outrageously low, please do get in contact with us because we do want to see it.
“Why are we discounting? You know, you don’t discount flights or hotels, I don’t understand really why cruises need to be discounted, it is such incredible value for money, so yeah, do let us know, we are here to support you and please do not lose out on any bookings, just call your sales managers as well, there is always something that can be done.”
Louise added: “90% of bookings are coming through the trade so we really do need to support you and help you, and perhaps we can do something to help get that booking across the line for you.”
Advantage Chief Commercial Officer Kelly Cookes said the consortium’s £650m-a-year cruise sales put it in a strong position to negotiate the best commercial deals. She added: “Generally, we don’t see the OTAs having big commercial differences any more.”
Kelly also urged members to customise cruise packages with pre- and post-cruise stays, and to sell the more expensive cabins to make it less likely they’ll be competing with the OTAs.
“It is a lot harder for someone to copy what you are doing when you have personalised and customised the product that you are offering,” she said. “A lot of discounting tends to be more apparent on the entry level, but what you are really good with all of your training and your knowledge is selling up the ship, which makes it really difficult for people to compete.”
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Bob Lines of Knowle Travel and Midland Cruise Club said some of the larger online agents receive so much more commission than independent agents that they can afford to give away as much as 15%.
Speaking at the Advantage Latitude cruise conference in Amsterdam last week, Bob said that by giving the large online cruise agents higher rates of commission, suppliers were preventing independent agents from being able to compete.
“Cruise lines depend on new to cruise customers to grow their businesses and it’s the independent agents who are training themselves and encouraging clients to consider cruise, but then they are going to the big online agents to book because they are discounting so much,” said Bob.
“I know cruise lines can’t dictate how much agents give away, but if they paid all agents the same commission, say 12%, then the cruise lines couldn’t offer more than a 9% discount because they wouldn’t want to end up with less than 3%.”
Bob claimed that P&O Cruises slashed commission rates ‘overnight’ for its Gold and Platinum sellers, from a maximum of 18% down to 7%, after some were giving away as much as 14%.
“I don’t want the other cruise lines to come down to 7%, but if everyone was on 12% no-one, not even the online players would give away more than 9%,” he said.
“If cruise lines are going to continue to grow, that growth is all going to come from new to cruise customers, and the only way these customers are going to find out about cruising is by visiting their high street travel agent or their local homeworker, they don’t ring a call centre for advice, but the big cruise companies are giving them the tools to discount.
“I know of three aggressively commissioned cruise companies that are giving as much as 20% to the big online travel agents and we are only probably working on 15%.
“Half of our turnover is in cruising, about £3m a year, but we still don’t come into the same ballpark as the big online agents.”
In response to Bob’s plea, Princess Cruises’ UK VP Eithne Williamson, who was also attending the Advantage conference, said she wanted to see an end to ‘across the board’ discounting.
“I’d be all up for stopping the discounting and making sure there is a leveller playing field, but there are some restrictions on that.
“If we can grow the cruise business rather than trying to pinch each other’s business, let’s get more people cruising is what I would hope we could do.”
Oceania Cruises Director of Sales UK and Ireland Louise Craddock said: “It is our biggest frustration when we see our beautiful products being discounted, we have it written into our commercial terms that no-one can promote Oceania with anything more than a 5% discount.
“What an agent does with a client over the phone is out of our control, but what we can do is monitor how people advertise our brands, so if you do see something that is outrageously low, please do get in contact with us because we do want to see it.
“Why are we discounting? You know, you don’t discount flights or hotels, I don’t understand really why cruises need to be discounted, it is such incredible value for money, so yeah, do let us know, we are here to support you and please do not lose out on any bookings, just call your sales managers as well, there is always something that can be done.”
Louise added: “90% of bookings are coming through the trade so we really do need to support you and help you, and perhaps we can do something to help get that booking across the line for you.”
Advantage Chief Commercial Officer Kelly Cookes said the consortium’s £650m-a-year cruise sales put it in a strong position to negotiate the best commercial deals. She added: “Generally, we don’t see the OTAs having big commercial differences any more.”
Kelly also urged members to customise cruise packages with pre- and post-cruise stays, and to sell the more expensive cabins to make it less likely they’ll be competing with the OTAs.
“It is a lot harder for someone to copy what you are doing when you have personalised and customised the product that you are offering,” she said. “A lot of discounting tends to be more apparent on the entry level, but what you are really good with all of your training and your knowledge is selling up the ship, which makes it really difficult for people to compete.”
The post Agent’s plea to cruise lines: Give us all the same commission appeared first on Travel Gossip.
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