Carnival (www.carnival.com) announced last week it is giving back to travel agents, but taking away something, too.
Vicki Freed, Carnival's senior vice president, sales and marketing, speaking on a panel of cruise executives at the The Tradeshow in Las Vegas, outlined a direct mail campaign specifically designed for travel agents called Carnival Targeter. The program is now in a beta-test phase, but is slated to launch live in the first quarter of 2008.
Participating agents will store their databases, which Carnival will not have access to, with a third party. Carnival will then target prospective clients based on those customers' interests such as family vacations, couples cruises and girlfriend getaways. Travel agents can log on to Carnival's web site and choose how many pieces of collateral they want to send.
One notable aspect of the mail pieces will be that they will only contain travel agent information such as a phone number or web site. While Carnival's logo will be present, neither its 800 number nor its web site will be noted. This is being done to further enhance the relationship between the cruise line and its main selling arm, travel agents. "It's all to re-engage with the agent community and help build their business," Freed said.
In addition, Freed told Travel Agent that Carnival would not be changing commission override levels, which have been static since 2003.
Carnival Ends Commissions on Airfare
However, a letter faxed to U.S. and Canadian travel agents on September 12 does outline Carnival Corp.'s move to cut out the payment of commissions on the air portion of cruise bookings. The policy will go into effect for all new bookings beginning October 15.
The letter, written by Carnival Corp.'s vice president of marketing, Jack Anderson, outlines the reason for the switch. "As you are aware," he writes, "several years ago the airlines stopped paying commissions on airfare. However, our cruise brands continued to pay commissions to agents for air bookings. During this period, airline prices to cruise lines have increased. The combination of increased rates from the airlines and our unique payment of air commissions have reduced the competitiveness of our air programs."
Travel Agent spoke with Anderson regarding the matter and he made it clear that the policy change in no way was a move to generate higher revenues. "There is no profit motive," he said. "It's to restore a competitively priced product."
Anderson went on to say that only 12 percent of travel agents are utilizing Carnival's air offerings because the prices are not competitive. Agents are opting to book air elsewhere, which effectively precludes them from receiving commissions anyway.
Some agents, however, are already expressing discontent with the policy shift. "With the cruise lines' already high non-commissionable fees," says Linda Grauer, owner of Four Seasons Tours and Cruises in Largo, FL, "that leaves such a small profit that if the cruise lines do this to us we'll have to rethink our way of doing business or change the lines we deal with." — David Eisen