Crystal’s Web Deal Startles Agents

Partnership has some travel agents dismayed, but agree it is a smart business move

By: Robert Carlsen

Crystal Cruises’ new relationship with Travelocity has travel agents concerned but resigned to the fact that business is business.

Crystal, traditionally one of the most agent-friendly of the lines, defended its move as a way to increase brand awareness.

Crystal joins Carnival, Holland America, Windstar, Royal Caribbean, Celebrity, Disney, Princess and Norwegian as the online agency’s cruise products.

“In our view, Travelocity is simply a travel agency that operates online as opposed to having physical retail locations,” said Adam Leavitt, senior vice president of marketing. “In actuality, well over half of their cruise business is closed through their call centers, as it is in most traditional agencies. This percentage might be even higher for Crystal’s cruises.

“As one of the largest online travel agencies, Travelocity has a huge audience, and from a marketing perspective they give Crystal an opportunity to cost-effectively increase our brand awareness.”

Travelocity is launching the partnership by promoting Crystal’s early-booking discount program, The Best of Everything. Discounts listed online are the same as Crystal’s offers to travel agents. However, Travelocity is sweetening its offers by prepaying clients’ gratuities.

Travel agents said this offer is in line with other client value-added benefits, such as picking up the costs of some shore excursions.

“Cruise and vacation suppliers are looking at agencies and consortiums that have big mailing lists or the ability to reach a large audience, which are already presegmented to quickly sell their products,” said Susan Pisani from Cruisin Easy in Santa Maria, Calif. “This is advantageous to them so that they hit load factors earlier than what has unfortunately been the industry standard of close-to-date booking this past year, thus boosting their bottom line.

“I would love to be outraged, but as the saying goes, ‘It’s nothing personal, it’s just business.’”

Obviously, agents are most concerned with pricing that the Travelocities and Expedias of the world will severely undercut agents.

“I find it interesting that Crystal wants to mass market its product through Travelocity,” said Steve Cosgrove of Dynamic Travel & Cruises in Southlake, Texas. “I do not think Travelocity has the clients or markets the Crystal product the way Virtuoso does. If Crystal isn’t careful, they risk trashing their rate integrity and eroding their future yields by going in this direction.”

Not so fast, Leavitt said.

“While Travelocity might be driven on price, Crystal is not going to offer fares on Travelocity that are in any way lower or different than our fares that are available to any travel agency,” he said. “Any consumer who books a Crystal cruise through Travelocity will be paying what they would pay through any agency.

“Part of our strategy in entering into this relationship was to grow our brand awareness in advance of the launch of Crystal Serenity (in May 2003). We feel that it will take some time to generate substantial business through Travelocity, but we are optimistic that, with consistent marketing and promotion, this will prove to be a mutually successful partnership.”

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