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Having made some enquiries with on-line travel agents for a couple of cruises in 2012, I’ve learned something interesting about P&O’s policies regarding travel agent pricing for 2012. As I understand it, P&O currently give TAs about 15% of the gross price as commission, i.e. the TA would pay P&O just 85% of the official price. Most TAs would share some of this margin with their customers, either as a straight discount off the price or perhaps as on-board credit. The amount offered varied by the length and cost of the cruise. You couldn’t expect much in the case of cheaper cruises; for example, 15% of £500 is only £75 out of which the TA has to pay their own operating costs. But for more expensive cruises the discount could be significant: 15% of £5000 is £750, and as the TA might not have had to do any more work selling the second cruise than they did for the first one, they might be prepared to offer up several hundreds pounds of that sum as discount.

For 2012 cruises, however, I gather that P&O are giving the TA a flat fee for each cruise booking made. As a result there don’t seem to be any discounted prices around (at least, not at the moment). I’ve had quotes from two TAs for a couple of cruises in 2012, the short 4 night cruise on Oriana and a longer (13 night) cruise on Arcadia. In all cases the TA has quoted us the current P&O web-site price.

This is quite a big change and there has been a lot of discussion about it on various forums. Some people are pointing out that TA prices for cruises with other lines e.g. Royal Caribbean or Celebrity are still being discounted, and this could be opening up a price gap. Other people are wondering if the policy will actually stick for very long, especially if initial bookings are lower than expected. Finally, the whole attraction of booking through TAs is being questioned – among the advantages of booking direct with P&O are the later deadline for final payment (8 or 9 weeks ahead of the cruise instead of 13 weeks or so) and the absence of credit card surcharges (up to 2.5% with many TAs). On all of these issues, we shall see what transpires as time passes. I have a feeling that this is a topic that I will be returning to later in the year.

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