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Advantage 2009: Discounting still biggest concern for cruise agents

Discounting remains the biggest area of concern for travel agents selling cruise, Advantage Travel Centres commercial director Julia Lo Bue-Said has admitted.
 
The Advantage consortium now accounts for a 15% share of the UK cruise market and as such is the second largest seller of cruise.
 
Despite the volume of sales, Lo Bue-Said said: “Discounting is still the single biggest area of concern. Although cruising is now mainstream it is difficult for agents to earn high margins because of discounting.”
 
She added: “We cannot completely leverage our cruise power as some of the large cruise retailers sit outside Advantage.”
 
Discounting is also making it almost impossible for agents to break into the cruise sector, she said.
 
She called on cruiselines to take a more proactive role.  “We do believe cruiselines can play a bigger role in trying to discourage discounting and level out the disparity of rates.”
 
Cruise commission payments for Advantage members average 14% and £55,000 has been paid out to members this year in bonus payments for cruise sales.


Lo Bue-Said added: “£55,000 is not to be sniffed at, and more opportunities will follow in the next few months.”
 
Agents’ feelings on discounts were mixed. Stowaway Travel director Paul Stowe – who also spoke out against discounting at the 2008 conference – said discounting levels were so high his agency could not compete.


“It’s not a level playing field for any of us. We cannot discount 15% because we don’t earn 15%,” he said.
 
But Steve Allerston, managing director of Holiday Travel in Bridlington, said the agency had managed to establish itself as a cruise specialist by offering extra services, such as free coach transfers to the Southampton cruise terminal.
 
He said: “Competing on price is not easy, so we decided to do something different. If you do enough advertising and shout that you are a specialist the public will see you as one.”
 
Giles Hawke, sales and customer services director of Carnival UK, which owns cruiselines including P&O Cruises, Princess Cruises and Cunard, said bigger rewards would remain in place for agents selling more product for individual brands.
 
“I don’t think there are many industries or businesses where the bigger players don’t earn more than the smaller players,” he said. He denied the cruise company wanted to compete with agent partners with its online discounts.

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