Tom Bastek | May 19, 2015 11:55 AM ET
Cruise Lines Giveth, and Cruise Lines Taketh Away
Cruise lines were my first experience with the “all-inclusive” style of vacation many years ago. There was a certain je ne sais quoi about it that just appealed to me. The ability to eat as much as I care, as many times as I care, at any time that I care was not only liberating, but flew in the face of my entire upbringing. Nowhere to be found were my father or mother, telling me what I could or (more appropriately) could not have.
Next came booze cruises, with local liquor distributors hosting all-you-can-drink alcoholic and non-alcoholic vacations long before the cruise lines dipped their feet in those waters. Then I found all-inclusive resorts with all the food, booze and bottled water I could drink.
The Next Level
The all-inclusive resorts didn’t stop there; they’re continuing to go one step further. Now properties from companies like Hyatt, Iberostar and Sonesta are bringing a la carte high-end alcohol and food, non-motorized water sports and even off-property dining options to the next level of all-inclusive resorts. They understand that there are enough people out there who want options, but don’t want to be piecemealed to death with add-on fees. This is something that the airlines could take a huge lesson from.
These all-inclusive companies continue to ask the questions, “What are the extra charges and why can’t we include them as well?” The future of all-inclusive could be off-property tour partners, restaurants and bars that all come part of your package. Designated taxi companies for airport transfers and trips into town that are also included in your price. All-inclusive is growing and will have to continue to do so in order to keep its customers happy.
A Step Backward
The cruise lines are in the process of going backwards by taking the airlines' lead. It all started with the cruise lines charging a fee for a la carte specialty restaurant dining options. Then came for-fee portions of the buffets. Now some are even charging extra for the lobster or filet mignon in the regular dining. Next the industry went to a pay-for-room-service fee.
Cruise lines charge for the destination excursions and are presenting shopping options to their “partner stores” who pay the cruise line a fee to be partnered in the first place. Any of the lines that do offer an all-inclusive alcohol package typically put the price at $50 a day for a limited amount of drinks. Add to that internet access, which is is not a right, but a privilege (and an expensive one at that). A few lines have recognized the importance of Wi-Fi and adjusted accordingly, but often the quality of it is sometimes not worth the price that you pay.
I know that there is a certain segment of the population that is looking for the most bare bones, stripped down, don’t need all the fancy food, can sleep in the dungeon, pack everything in a duffle bag type of travel that the piecemeal plan works for. They don’t want everything included because they don’t drink, don’t check baggage and prefer simple cuisine. So why should they have to pay for it?
But there is also a group of people that don’t want to fly “Simple Airways,” stay at “Simple Inn,” and eat simple food. This demographic wants simple, too. They just want it to be, “How much for this vacation? Fine, here is my money, now leave me alone.” They want a simple fee structure where they don’t have to spend five hours trying to figure out that a resort that lists at $239 a night is actually $449 after you add up all of the fees.
There are two distinctly different ways that the future can go for the cruise line industry. They can continue along this same path of individual fees and hope that the segment of the population that this appeals to continues to put money in the coffers. They had also better hope that it continues to grow, because that same simple demographic isn’t spending money at partner stores or on cruise ship-led excursions.
The other choice is that they start to bundle in as much as possible, and as each raise in base rates comes, do their best to publicize what that increase is paying for. This goes back to the whole, “I know we are paying more, but now look what else we are getting.”
With the increase in popularity of hand-crafted cocktails, culinary tourism, foodie-ism, instant gratification, social sharing, self-exploration and freedom-travel, the public is going to desire more laissez faire vacations where guests can get what they want and all they want, when they want it. Fee-intensive pricing structures fly in the face of the “keep it simple” approach. Eventually everyone reaches a tipping point of “too much work to plan” and opts for the simpler solution. Where is that saturation point?
Have you ever reached it and given up planning something because of it becoming too labor intensive? Are you a piecemeal service traveler or are you a “give me one price for everything” person? Let me know in the comments below.
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