Major Booking Policy Changes Announced by Princess

In a change which will likely have broad impact, either to Princess or to the entire mainstream cruise industry, Princess has announced some major policy changes to new bookings starting with their 2009/2010 sailings which are in the process of being released:

• DEPOSIT REQUIREMENTS for 2009 - 2010 will be based on a percentage (%) of the fare rather than a flat dollar amount ($). Most voyages will require a deposit that represents 30% of the cruise fare.
• CRUISE CHANGE FEES will no longer be assessed for adding or changing land packages, or changing the first or last name on a booking (including name corrections).
• MINIMUM AGE for children will be 6 months on all trades except for Exotics and Transatlantics, where the minimum age will be 12 months.
• Minimum age for escorted cruisetours is 5 years old.
• NEW SUITE CATEGORY WS will be created on Caribbean Princess when she undergoes her dry-dock in 2009. These suites will have a picture window instead of a balcony.
• ESCAPE FARES will be the new name for our Early Booking Discount Fares, reinforcing our Escape Completely tagline.
• SPECIAL PAST PASSENGER DISCOUNTS will be launched beginning with Europe 2009. The discount applies to all categories and begins at program launch. The discount expires Sept. 30, 2008 for Alaska and Europe, and Dec. 31, 2008 for all other trades. It combines with many different fare types including other past passenger promotions. Specific discount amounts will vary by trade. For Europe, the discount is $100 per person.

The most significant change is, of course, the deposit requirement. Previously ranging from $250-600/person (or occasionally higher), based on the length of sailing, it is now significantly higher for most sailings and is based on the fare. This type of deposit has been common in some luxury lines for some time, though usually not this high a percentage.

My guess as to why they are doing this is that they've been having too many cancellations coming from early bookers. While the deposits under this policy remain refundable until final payment, people will be putting up a higher deposit, so will likely be more serious about taking the sailing from the get-go. With lower deposits, some people have been prone to say "well, I think we want to go, so let's go ahead and deposit and lock in the cabin and fare - we can always cancel later."

Personally, I think this may end up being a poor decision on Princess' part, at least in the short term. If the other lines in competition with them, most notably Royal Caribbean in general, and even more specifically Holland America in Alaska, don't match this policy, passengers who had been considering Princess along with another line will be more likely to choose the competitor if all other factors are equal. 30% on a European cruise or Alaska CruiseTour is a significant amount, especially if you're considering several cabins for a family group, for example.

I also think this will negate their pricing advantage they've held in general over Royal Caribbean, which has been the focus of much of their advertising. And while they still have more itineraries and options in Alaska than Holland America (who offers similar Glacier Bay itineraries), this should make the HAL sailings more attractive, which could rapidly push up the HAL pricing as their sailings sell out more quickly.

However, there is the potential that, like the luggage fees with the airlines, this is just the first line to change, and others will follow with similar policies. Let's hope not.

This policy will make a difference in how I counsel clients. I will always recommend passengers look at a combination of factors in choosing a line, including activity level, service style, dining preferences, cabin types, overall value and of course itinerary, and Princess excels in several areas, especially itinerary/value combination in many of their itineraries. But as part of my explanation of a line, I will have to disclose the difference in deposit up front to clients, and they may have me eliminate Princess on that basis without giving the other factors their proper evaluation. It's a shame.