RCCL execs pleased with pricing-discipline policy

Royal Caribbean’s campaign to curb last-minute deep discounts is off to a good start.

So say top execs at Royal Caribbean Cruises Ltd., who had several things to say about what they’re calling Royal’s “price integrity policy,” in talking to Wall Street analysts last week.

Starting in March, Royal said it would stop filling its ships by offering very low prices within a month of sailing. Depending on the itinerary, Royal said it would stop discounting either 10, 20 or 30 days before the ship leaves the dock.

In an earnings call with analysts, Royal Chairman Richard Fain said the company was extending the policy in some cases to apply to bookings within 40 days of departure.

That is what is called incremental progress. If Royal sticks with it, there may be positive results for both Royal and travel agents.

Fain said that Royal is trying hard to be more consistent in its pricing, in part to keep travel agents in its corner.

“There’s probably one thing that frustrates the travel agents that we work with as much as anything else, [and it] is those late last-minute discounts,” he said. “And we can’t afford to frustrate them.”

A bit later in the call, CFO Jason Liberty raised a second reason why curbing the deep-discount cycle will benefit Royal.

“It’s really very important to the branding,” said Liberty. It lacks credibility, Liberty said, to contend that you are a brand that is high quality and has high respect in the industry — “and you can have us for half-price.”

“So the ability to maintain your image as a higher-quality product, which really has to permeate everything you do, is probably a big driver, as big a driver of our thinking as anything else,” Liberty said.

Fain said Royal recognizes that the policy is costing money in the short term. But Royal’s second-quarter earnings were up 34% from a year ago, so any losses are being offset elsewhere.

“It’s still early days, but the impact we have seen from a load factor perspective is relatively small, and it’s in line with our expectations,” Fain said.

For RCCL’s Fain, onboard art helps differentiate sister ships

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The giraffe wearing an inner tube, an art piece next to the climbing wall on Anthem of the Seas.

SOUTHAMPTON, England — Hanging on walls, suspended from ceilings, rising from pedestals and platforms, braving the weather on upper decks and turning stairwells into galleries, art is the singular attribute that defines and separates the personalities of the Anthem of the Seas and its structural twin, the Quantum of the Seas.

An astounding variety of media, from bricks to light bulbs, are employed onboard the Anthem, unified by the theme “What makes life worth living.”

Purchasing art for a cruise ship, it turns out, is a bit more complicated than selecting an oil painting to hang above your sofa.

There are a variety of technical as well as aesthetic considerations. For example, there’s little chance your apartment will list or roll or that the art in your home will be touched by hundreds of people every day for decades.

Or, if it’s kinetic or illuminated, that it will need circuitry beyond what’s specified for typical consumer appliances. (click the Video link to watch the Richard Fains artwork explained)

Anthem of the Seas Artwork with Richard Fain

And your backyard fountain probably isn’t programmed to shut down if the ground tilts beyond a certain angle.

Richard Fain, the chairman and CEO of Royal Caribbean Cruises Ltd. (RCCL), said during the Anthem’s pre-inaugural sailing that collectively, the art aboard the company’s ships represents a huge investment. RCCL’s spending on art is in “nine digits,” he said, though he also allowed that art is perhaps the only shipboard procurements that appreciate after purchase.

Most onboard art is acquired with the assistance of a consultancy that specializes in corporate art, though some is commissioned directly from an artist.

Over the years, there have been disappointments, even failures.

In 1987, RCCL commissioned a 9-foot-diameter clock that used tiny glass beads to tinkle, rather than chime, the quarter hour. It was for placement in the Sovereign of the Seas atrium. “I saw it work in the artist’s studio,” Fain said. “It was magnificent.”

And that was the last time he saw it work. The artist spent months tweaking it after it was installed. Engineers were brought in. But tinkling was never again heard.

“The head of [subsidiary] Pullmantur said, ‘I’ll make it work.’” But it was not to be. Today, it keeps time on a Pullmantur ship but still doesn’t function as intended.

When RCCL sells a ship, the art does not go to the buyer; it is removed, and sometimes finds a home aboard another ship.

Fain takes a strong personal interest in the art, and he can give nuanced analyses of various pieces, taking note of color saturation, light, movement, texture, technology, artistic intention and, it turns out, functionality. When he was first shown a catalog detailing the art aboard the Anthem (a catalog that was placed in every stateroom), he paused on the page of a large, illuminated piece and told an executive to check out the installation because “there are four lights out.”

Fain sees a “yin-yang” both in individual pieces and in how the Quantum’s and Anthem’s art varies. While the Quantum’s collection is by no means serious, Fain frequently used  the word “fun” to describe Anthem art. Perhaps the best examples of how the two differ are the choices of statuary on Deck 15, near the rock-climbing walls. The Quantum has a giant magenta bear, holding on to the deck above; not a serious piece, but not as whimsical as the giraffe wearing an inner tube on the Anthem.During a “Common Ground” session during the sailing, in which Fain and other executives answered questions, one agent stated, “I’m not interested in art — I don’t really have time to be interested in art — but this really opened my eyes.”

Another asked Fain, “Why a giraffe in a swimsuit?”

The curator-in-chief didn’t miss a beat in responding about what is possibly the most surreal object on the ship.

“What else would you have there?” he asked.

How to get stateroom upgrades on Royal Caribbean cruises

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A lot of our readers are curious how to get upgraded on their Royal Caribbean cruise so they can enjoy better accommodations without a higher price.  It is true that from time to time Royal Caribbean will upgrade select passengers to better accommodations for a variety of reasons.

Here’s at least one way to ensure you’re ready for an upgrade if it were to be available on your cruise.

 

We should mention that getting a stateroom upgrade is incredibly rare and is not common at all.  It is a practice that does occur, usually because the stateroom category someone has booked is in demand and Royal Caribbean wants to free up space in that category.

Upgrades can be to a slightly larger stateroom or jump to a different level.  Regardless, upgrades are out of your hands in terms of influencing someone to get one.

Royal Caribbean does provide a means for its passengers to indicate if they would like an upgrade, which can factor into who is picked for an upgrade.

If you’re a Royal Caribbean Crown and Anchor Society member, there is a section on the Royal Caribbean website to fill out your upgrade preferences.

Once on the page, you will find three main options

  • I prefer an automatic upgrade
  • I do not wish to upgrade my stateroom
  • I would like an upgrade but have restrictions

You may select from the following options and indicate which you prefer.  This process can only stand to help your chances at an upgrade, although there’s no proof that filling out these preferences or not filling them out will increase or decrease your chances at an upgrade.  It’s our opinion if you want an upgrade to ever happen, filling out this section is important.

You may also wonder why someone would not want an upgrade and that can be because they have picked a specific stateroom and do not wish to change.