The river cruise sector must avoid falling into the same “discounting trap” as last year as “ridiculous” deals will harm both the lines and agents, operators have warned.
Speaking in a round-table discussion hosted by Travel Weekly, Paul Melinis, APT managing director for the UK and Europe, said price cuts during the 2023 wave season were “extreme” and triggered an “unwanted discount market” in which lines and agents lost revenue.
He praised the sector for its performance during this year’s wave but warned “significant volumes” of sales were once again being driven by heavy discounts and said it was “too early” for lines to be dropping prices by so much.
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“There have been some ridiculous deals for early-season sailings,” he said. “They are driving significant volumes, but we’ve got to be mindful that we don’t get into that unwanted discount market again.”
Melinis emphasised the dangers of consistent heavy discounting, saying that repeatedly dropping prices “means nobody wins”.
“We can’t fall back into that discounting trap because it kills everybody,” he added. “The cruise lines make no money, the agent loses commission and, most of the time, the clients that you get at that price don’t ever come back.”
Melinis’ views were echoed by Lucia Rowe, A-Rosa managing director for the UK and Ireland, who urged the sector to avoid the “bloodbath” of last year’s discounting, saying although the sector is “moving in the right direction”, lines must “stay calm” and avoid a repeat of last year.
“We’re definitely moving in the right direction compared to 2023, there’s no doubt about that,” she said.
“There are some early departures here and there with really low lead-ins, but the reality is that it was a bloodbath in 2023 so we’re definitely in a better position now. But we can’t lose our nerves and we mustn’t start discounting the departures that are really popular.”
The Cruise Room director Robbie O’Grady said he has seen “significant” discounting within the river cruise sector, warning although it does prompt a surge in bookings, customers will not rebook at an increased price.
“We always see more river cruise bookings when the prices drop, there is no two ways about it,” he said. “We often have people who try their first ever river cruise because the price was at a level they thought was reasonable. The challenge we face is that although they enjoyed it, when they look to book again the price is significantly higher, so they don’t.
“We had a couple in that exact position who sailed last summer but when they went to rebook, and despite their healthy budget, the cost was three times greater than the amount they paid and they couldn’t justify it so they switched over to ocean.
“This model does not work.”
Spear Travels manager Kim Kent urged river cruise lines to be careful when discounting, adding: “If [lines] reduce the costs too much it attracts the wrong market”.
However, AmaWaterways managing director Jamie Loizou argued there is some “smoke and mirrors” around the discounts available in the market, saying peak times prices are still as firm as ever.
“It is easy to get distracted by pricing,” he said. “Although there is discounting in the market, it isn’t for the peak times where people are desperate to travel because there is so much demand,” he said.
“The competitive leads are for times of year where people don’t traditionally tend to take a river cruise.”