Cruise Ship Blues: The Underside of the Cruise Ship Industry (7 page)

Shipboard photographers miss few opportunities to take pictures. Passengers pose with the captain as they enter the Captain’s Welcome Cocktail Party, have their picture taken at dinner on formal nights and on theme nights, and can choose from several occasions to have a formal portrait done. As well, many candid shots are snapped as passengers leave the ship at a port of call, while on shore excursions or tours, and as they go about their day onboard. All photos are on display to make purchases easy.

people tend to want vacation photographs of themselves, so sales are practically guaranteed. photographers further encourage sales by offering discounts for multiple pictures or by providing an added value to the photo, such as a photo album or frame. One operator increased net photo revenue on a single ship by $1 million a year through offering passengers a discounted price and a souvenir photo album for pre-purchasing six photos. Passengers were offered a package deal that included five photos (price: $7 each), an 8 x 10 portrait (price: $12), and a souvenir album (price: $20) — a $67 value for $40.

The scheme increased net revenue by $1.39 per passenger, per day.
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(The contrast between his success and the experience of the insolvent photographer mentioned earlier is due mainly to the difference in buying habits of passengers onboard mass market and ultraluxury cruise ships; the latter purchase few photographs.)

Open Your Wallet and We’ll Show You the Sights

In December 2001 I visited St. John in the uS Virgin Islands. My partner and I took a taxi to Trunk Bay. The trip cost us $6 each way, $12 total including a tip. The cruise ship offered the identical trip, in identical taxis, for $43 per person.

The sale of ship-sponsored shore excursions is a significant source of revenue. Depending on the port, between 50 and 80 percent of passengers purchase a shore excursion. Three companies

— International Voyager Media, Onboard Media, and the PPI Group — operate the vast majority of shore excursion programs.

The shore excursion provided by the cruise line is convenient — but the cost for this convenience is considerable. The shore excursion concessionaire contracts with a local tour operator, then offers the program to the cruise line. Each one adds to the price. The markups create resentment among passengers who expect more than what they receive. For a shore excursion that costs the passenger $60, the local tour operator receives between $15 and $20. The passenger expects to receive a product worth $60, but the operator receives nowhere near this amount for the tour provided.

My Script Says These Are the Things to See

Closely allied with the sale of shore excursions are “port lectures,” spiels about the port’s attractions, including shopping, as part of the sightseeing tour. The same company contracted to provide shore excursions often provides the port lecturer. The lecturer’s income may be tied to the number of shore excursions purchased by passengers, in the form of a bonus for generated sales.

Although port lecturers tell passengers about the sights in a port, rarely are they hired for their expertise on either the port or travel in general. port lecturers are given a script to read and they tend to follow it fairly closely. When they deviate, the information provided can be amazingly incorrect.

A main focus of the port lecturer’s job is to talk about shopping. He or she gives cruise ship passengers a map which identifies

“approved” stores, explaining that the main advantage of shopping at these stores is that the quality and value of merchandise is guaranteed, and the cruise line will facilitate refunds if the purchased product is not as it was advertised and sold. They are clear that refunds cannot be had in a case of buyer regret, but getting a refund for other reasons is often more difficult than you are led to believe. Only a few cruise lines will tell you that the stores on the approved list have paid a fee to be included.

A 1999 article in the
Boston Globe
cites a gem and jewelry specialist who warns that jewelry fraud is rampant abroad. She described cruise ship passengers as “lambs being herded to slaughter.” According to this specialist: “These stores are taking advantage of the fact that people are looking for bargains.. Everyone wants a memento of their trip and, for women, jewelry is one of the favorite mementos.”
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As for the cruise line’s guarantee, she points out that it is an easy promise to make since most people don’t bother to check anything out when they get home. Those who do bother often find that getting a refund is not easy.

GETTING A REFUND IS NOT AS EASY AS THEY SAY

The most common dispute over port purchases relates to the value of jewelry. Passengers are often "guaranteed" that the item is better priced than it would be at home. While most accept this claim without question, some buyers have unhappily discovered that it was unfounded. Consider the following:

•    The
Conde Nast Traveler
ombudsman reported in 1996 a case

where a passenger on Carnival Cruise Line's
Sensation,
during a shore excursion at Ocho Rios, Jamaica, purchased a diamond engagement ring at Colours for $2,350. An appraisal certificate for $4,450 accompanied the ring. When the passenger returned home, he took the ring for an independent appraisal and was told it was worth $600 less than what he had paid. The passenger followed the refund application instructions he had been given on the ship, but to no avail. The store refused to accept the credentials of the passenger's independent jeweler, and Carnival stood behind the store's position. Not until the passenger secured the
Conde Nast Traveler
ombudsman's assistance was a refund finally provided.
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•    The "Consumer Beat" column in the
Boston Globe
reported on a

similar case in 1999. A cruise ship passenger had purchased a tanzanite and diamond ring at Rachat & Romero in Cozumel, Mexico, while traveling with Celebrity Cruises. He had paid $2,400 for a ring that the Mexican jeweler appraised at $6,530. After the passenger returned home, he sought an independent appraisal and was told the ring's value was $1,900. When he approached Rachat & Romero, they said their appraised price was more like a suggested retail price, even though it was identified on a document entitled "certified appraisal." Although the
Boston Globe
was able to secure a refund offer, the passenger rejected it, on the basis that to agree "to a refund would be letting the cruise line and jeweler off too easily." He said, "They're basically saying you caught us at fraud so what we'll do is give you your money back. I think that stinks. How many other people are they ripping off?"
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Get Your Hair Done for That Formal Night

Cruise ships traditionally offer personal services such as hairstyling, manicures, pedicures, facials, and massages. Over the past decade the range of services has expanded with introduction of larger and more elaborate spas. Increasingly, the full range of personal indulgences available at a spa at home is available at sea.
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Prices at sea are no less than at home; in fact, they are often much higher.
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A concessionaire provides the spa and personal services. A British-based company called Steiner Leisure Limited has almost exclusive control over spa services provided to the cruise industry. In 2001 the company had the concession for 23 cruise lines, including more than 100 ships.

One of Steiner’s competitors was Mandara Spa on Star Cruises and Norwegian Cruise Line. Mandara had contracted with Norwegian Cruise Line in 2000 after the cruise line chose not to renew with Steiner. Ironically, Steiner acquired Mandara Spa in June 2001.
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Scheduled for completion in December 2003, the spa on the
Queen Mary 2
will be designed and operated by a newcomer to the cruise industry: Canyon Ranch Health Resorts. Canyon Ranch has two of its own ships under construction.

New and Better Ideas for Separating You from Your Money

Cruise lines continue to introduce more ways to grab a passenger’s money. The late 1990s introduced the onboard art auction, which quickly became one of the most lucrative endeavors. Indeed, on some cruises this is the single largest source of onboard revenue.

Fine Art at Kmart Prices

You can now purchase fine art while on your cruise. I have been given a chance to buy art by Rodin, Dali, Picasso, Chagall, Erte, and others of comparable stature — amazing the deals that can be had on art by a 20th-century master, and all available at onboard art auctions!

Norwegian Cruise Line introduced shipboard art auctions in the mid-1990s. Once other cruise lines realized the income potential, they quickly followed suit. On most cruise lines, auctions are handled by one of two companies — the same contractors that handle most shore excursions. Onboard Media (owned by Louis Vuitton Moet Hennessy), through its sister company Cruise Management International (which has a partnership with Park West Gallery), serves Celebrity Cruises, Costa Cruises, Carnival Cruise Line, Crystal Cruises, Holland America Line, Princess Cruises, and Royal Caribbean International. The PPI Group, publisher of
Porthole
magazine, is the other major player.

Two strategies are commonly used to attract passengers to the auctions. One is to provide free champagne to anyone previewing the art and/or attending the auction. The other is to have the auction include art, often signed serigraphs or lithographs, of well-known artists.

The main selling point used by auctioneers is that pieces of art may be had for as much as 80 percent off shoreside prices. Many passengers report that this claim is accurate, although a February 2001 article in
USA Today
cites a number of people who dispute its accuracy. In one case, the same piece of art bought on the ship was found at the neighborhood Kmart for sale at a fraction of the shipboard auction price. No matter which view is correct, art auctions are big business. Park West Gallery reported selling 200,000 pieces of art aboard cruise ships in the year 2000.
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