I guess DCL won this one...

[Tonka's Skipper]

But those forums, well at least one of them is not known for die hard Disney nuts.

I was referring to the one that shall not be named here, CC and WDW magic. There are of course others and this was not a full survey/poll it was only a observation.

AKK

 

[eskimoinparadise]

i've been thinking about this a lot. it made so much sense however the more i thought about it the more i felt that while the theory is right, it didn't all quite fit. i have a friend who worked on the magic and he said the dream was the cash cow for dcl and for the exact reasons you have said. twice as many people in a week, twice as many sales of the same things.

the part that bothers me is a lesson i learned years and years ago. i worked for a very very large business and we learned to keep the repeats happy. while we could lose money doing it, they were the free advertisement, the word of mouth. people talk bad about a company five times more that they talk good. so you annoyed a client and they would tell five who would tell five and so on. thats why i think dcl doing things to get repeaters to not come back is a wrong premies. maybe not all five of the people i tell are going to listen to what i have to say but some will. hey, if i have sailed dcl X number of times and am not going back, there must be something wrong. thats just not good business.

i certainly could be wrong but i would think dcl is being semi quite about everything going on because they want it to die down and given time it will. if they respond it just stirs the pot again and it will take longer for people to get over it but make no mistake, they have a strategy and i doubt its to get rid of repeaters. they may lose a little money on you up front but they will make a whole lot on the back end.
jmo

In reality, most of the research into this theory would indicate that the vast majority of disappointed customers simply walk away and don't say anything to anyone. The customer who is statistically most likely to follow your tell-five-others theory is the customer who first complains to the company and is either ignored or has his complaint marginalized. All companies know exactly what their customer churn rate is, and the good ones have a really good grip on what the life time value of a customer should be. If the value begins to tail off, the company will inevitably begin a process to wean that customer from the flock. One of the leading researchers in this area, Martha Rogers, postulates that 15-20% of a company's customer base actually costs them more in support and handholding than they ever return either in revenue or in "word-of-mouth" promotion.

 

[tinkerone]

In reality, most of the research into this theory would indicate that the vast majority of disappointed customers simply walk away and don't say anything to anyone. The customer who is statistically most likely to follow your tell-five-others theory is the customer who first complains to the company and is either ignored or has his complaint marginalized. All companies know exactly what their customer churn rate is, and the good ones have a really good grip on what the life time value of a customer should be. If the value begins to tail off, the company will inevitably begin a process to wean that customer from the flock. One of the leading researchers in this area, Martha Rogers, postulates that 15-20% of a company's customer base actually costs them more in support and handholding than they ever return either in revenue or in "word-of-mouth" promotion.

my learnings were that the clients who simply walked away and didn't say anything to us where the exact clients we needed to fear because they were the ones who did speak badly of our company, to anyone who would listen, and since we were not aware of it there was little to combat it. the people we reached out to, even if we could not resolve the issue, were the ones who would pass on the word that at least we tried. i know the last part to be a fact because i often had to interact with annoyed clients even though i could not give them what they wanted. it is correct that if a complaint is either ignored or the complaint is marginalized the client will be mad, of course that is true. you can't keep everyone happy but speaking honestly and not trying to bs a client usually worked to calm a situation.

maybe things have changed, maybe our company brought in teachers that worked backwards, i don't know. i'm not wanting to have a debate on customer service, i really don't care that much. dcl will do what dcl will do and for their own reasons. far be it for me to try and figure that one out. lol.

 

[waltdisneymom]

it will because disney is not responding to a great extent. just the one on one calls and emails to pacify people. their doing what they can to control the situation but quietly. in a month or so, this will be like it never happened. its a brilliant company move. i've been retired for three years so i had forgotten the tricks of the trade, lol. dcl would have already weighed the lose to gain ratio, they know what to expect. they placed their bet and is hoping for a win.

Except that there is a tipping point. We used to go to wdw every year but stopped after the fp+. The year before the individual cleaning our room at the grand Floridian did not make up our room until around 5 pm every day. This was a change from previous years. We saw her one day and asked her about it. We were very nice. She yelled at us that she was treated horribly by her employer and had to clean at all star every morning. We felt awful for her and never said anything to anyone about it. But we never went back to the GF. We were those people who vowed we would never stay off site. But we stayed at the Waldorf Astoria the following year. But the fp+ was the final straw for us. It's awful. So we found dcl. But it already seems to be changing... Very disappointing

 

[Tonka's Skipper]

it will because disney is not responding to a great extent. just the one on one calls and emails to pacify people. their doing what they can to control the situation but quietly. in a month or so, this will be like it never happened. its a brilliant company move. i've been retired for three years so i had forgotten the tricks of the trade, lol. dcl would have already weighed the lose to gain ratio, they know what to expect. they placed their bet and is hoping for a win.

They are playing it well. However as you mentioned and Jimmy V did well, that old wise business practice of knowing *its much easier to keep a customer then get a new customer* still holds with me. DCL has more bean counters and a different business platform then my little firm, but I think they are treading on thin ice. Disney lives by the brand and word and mouth. they lose that and the Igor and Igortrons will not be able to get outta Anaheim fast enough!

AKK

 

[JimmyV]

thats why i think dcl doing things to get repeaters to not come back is a wrong premies. maybe not all five of the people i tell are going to listen to what i have to say but some will. hey, if i have sailed dcl X number of times and am not going back, there must be something wrong. thats just not good business.

You can't look at it in absolute terms. No company wants to jettison all of its repeat customers and replace them with first timers. And no business wants all repeaters. There are statistical models for this stuff and they are studied relentlessly. The bottom line is that a popular business like Disney wants and needs a mix. If they start to see a trend developing in a way that upsets revenue maximization, they will do things to right the ship, so to speak. That might mean doing things that will discourage some repeat guests, or doing things to attract first timers. Or vice versa.

Except we were first time cruisers last year (first time on any cruise) and all we spent extra (besides the original cruise fare) was one dinner at palo (2 people, 1 glass of wine each). No gift shop, no excursions, no extra drinks, no popcorn, etc. So I don't think it is so cut and dry that first time/new cruisers spend more. We are not super thrifty or anything. We usually stay at the grand Floridian at wdw. And we did not bring any of our own alcohol on the cruise.

As noted above, there are statistics on this stuff that the industry relies on. Rest assured, if you were a first timers who sat on your wallets, you were in the minority. By a lot.

 

[tinkerone]

You can't look at it in absolute terms. No company wants to jettison all of its repeat customers and replace them with first timers. And no business wants all repeaters. There are statistical models for this stuff and they are studied relentlessly. The bottom line is that a popular business like Disney wants and needs a mix. If they start to see a trend developing in a way that upsets revenue maximization, they will do things to right the ship, so to speak. That might mean doing things that will discourage some repeat guests, or doing things to attract first timers. Or vice versa.


As noted above, there are statistics on this stuff that the industry relies on. Rest assured, if you were a first timers who sat on your wallets, you were in the minority. By a lot.

i still doubt very much they do anything to discourage repeat cruisers. they may not do things to encourage repeaters but they are never going to discourage. that is bad business.

as to being a first timer and not spending a lot, i'm not sure that would be a minority. my first cruise i spend less than $50 (not including tips). there are a lot of people on here looking for ways to sail and not break the bank, one of those ways being bringing your own liquor which has now gone the way of the wind. first timers often don't know the ropes so it can be more of an exploration than a spending spree.
again, jmo and i have been wrong before.

 

[eskimoinparadise]

i still doubt very much they do anything to discourage repeat cruisers. they may not do things to encourage repeaters but they are never going to discourage.

Once a company adopts this pruning strategy, there rarely is any need to do anything to actively discourage those customers who have exhausted their lifetime value. You do things obtusely - like eliminating benefits; making discounts more difficult to find; altering the pricing model, etc. Let's see: try finding a resident discount; try getting a better OBB based on the number of times you've cruised; try taking a late night swim or dip in a hot tub; try booking multiple future cruise placeholders; try bring on board your own beverage of choice. Oh wait - they've already tweaked all of that. A newbie wouldn't even know those things existed, but a repeater would have come to expect those benefits of loyalty or service (and POOF they're gone) - a classic pruning strategy. It usually works so well that by the time the intended target (customer) realizes they've been "fired" by the company, it's too late to do anything about it.

 

[JimmyV]

first timers often don't know the ropes so it can be more of an exploration than a spending spree

When you are the bean counter counting the beans, it doesn't matter what you call it. The division head can ask: "Did we have a lot of explorers on that cruise?" or ask: "Did we have a lot of people on a spending spree?" As long as the checks clear, they don't care.

 

[TChrist05]

Once a company adopts this pruning strategy, there rarely is any need to do anything to actively discourage those customers who have exhausted their lifetime value. You do things obtusely - like eliminating benefits; making discounts more difficult to find; altering the pricing model, etc. Let's see: try finding a resident discount; try getting a better OBB based on the number of times you've cruised; try taking a late night swim or dip in a hot tub; try booking multiple future cruise placeholders; try bring on board your own beverage of choice. Oh wait - they've already tweaked all of that. A newbie wouldn't even know those things existed, but a repeater would have come to expect those benefits of loyalty or service (and POOF they're gone) - a classic pruning strategy. It usually works so well that by the time the intended target (customer) realizes they've been "fired" by the company, it's too late to do anything about it.

Wow...first time in my life I've been fired and I'm retired after 44 years with my company. What you say makes a lot of sense. I am certainly getting an education and I thought DCL had opened my eyes--but in reality I think some of you guys did.

 

[tinkerone]

Once a company adopts this pruning strategy, there rarely is any need to do anything to actively discourage those customers who have exhausted their lifetime value. You do things obtusely - like eliminating benefits; making discounts more difficult to find; altering the pricing model, etc. Let's see: try finding a resident discount; try getting a better OBB based on the number of times you've cruised; try taking a late night swim or dip in a hot tub; try booking multiple future cruise placeholders; try bring on board your own beverage of choice. Oh wait - they've already tweaked all of that. A newbie wouldn't even know those things existed, but a repeater would have come to expect those benefits of loyalty or service (and POOF they're gone) - a classic pruning strategy. It usually works so well that by the time the intended target (customer) realizes they've been "fired" by the company, it's too late to do anything about it.

but isn't that what i said? they may not do things to encourage repeaters?

When you are the bean counter counting the beans, it doesn't matter what you call it. The division head can ask: "Did we have a lot of explorers on that cruise?" or ask: "Did we have a lot of people on a spending spree?" As long as the checks clear, they don't care.

i don't understand your point. i thought you said that that waltdisneymom was a minority, that dcl was counting on the fact that first timers spend spend spend. so why would the 'bean counters' check a box for explorers? there would be no point in getting rid of repeaters if they don't care.

this is all becoming a customer service tutorial so i think i'm out this time. as i think i said above, i really really don't care. it is what it is. these are just my thoughts, not necessarily the right thoughts but not necessarily wrong either.
who knows??

 

[JimmyV]

i don't understand your point.

It's simple. It doesn't matter if you spend money because you are "exploring", ("Honey, let's try Palo. I read on line that it is very good"), or if you are spending money because you are on a "spending spree", ("Let's live it up on this vacation, and dine at Palo"). Either way, you are spending money. And yes, first time cruisers who do not spend a lot of money on ship-run excursions, photos, t-shirts, souvenirs, etc. are in the minority. While vacations are fun and frivolous things to most of us, to people in the industry, there are lots of very dry marketing studies and research papers that back all of this up.

 

[Tonka's Skipper]

One thing I have not seen mentioned........could this be the start of a whole industry cut back.

DCL has cut a few things, the most touchy obviously the drinks issue, which is the most visible one. But so has Carnival and I have been told RCL too. The biggest cut backs and increasing prices has been NCL, with a big expansion of their buy up restaurants into A la carte starting in 2016.

I do believe that the whole industry is slowly working toward *a pay as you eat* system will be the norm in a few years.


AKK

 

[JimmyV]

I do believe that the whole industry is slowly working toward *a pay as you eat* system will be the norm in a few years.

We'll see how people react, and what the pricing is. People view their upfront cost of the cruise to include all dinners, but are willing to pay a surcharge for special items. If a really good steak at a land-based restaurant goes for $50 with sides costing more, then people can handle a $25 upcharge for a similar steak with similar sides, figuring that they just mentally move some of their upfront cruise cost over to this restaurant and it is a wash. But if the a la carte pricing on board the ship in any way, shape or form resembles that of the land-based restaurant, people are going to boycott en masse. I can walk out of a Ruths Chris for $70 per person (before wine) and feel lighter in the wallet, but not robbed. But if I have already paid thousands for the cruise and then have to pay $50 per person for an a la carte meal, I would be livid. But if the pricing reflects the fact that I have already sunk some cash into the meal by way of my cruise fare, and my steak is priced at $15 on the a la carte menu, and the appetizers, sides and desserts come to another $10 in total, I could live with it. Bottom line is that there is a limit to what I am willing to spend for an "upgraded" meal, and I don't care if they hit that limit by charging me a single fee, or by charging me a la carte. Personally, I think the a la carte model is really, really dumb, given how much food there is on a ship. Why spend extra for a dessert at a specialty restaurant when I can take the elevator up to the buffet and grab a dessert there that is already paid for. Same goes for a salad. And veggies for that matter. The only thing I am really interested in paying for is the main course. Once the ship starts to charge for every little item, the pricing becomes very transparent, and I start to do some math. And when I do that, I am likely to skip it.

 

[Tonka's Skipper]

""We'll see how people react""

All good points Jimmy. However just leaning back and looking at the industry , all the new ships are coming out with more and more side restaurants, some buy ups. the MDR are becoming less important.
It would not take much to slowly keep making more and more buy up total paid for meals.

Yours above is the bottom line, will people accept it!

AKK

 

[waltdisneymom]

We probably are an outlier in the studies (in that we spent almost nothing as first time cruisers), but I don't know that I agree with the idea that the studies are correct. Or maybe I disagree with the idea that disney is interpreting them correctly. I think disney executives need to stop listening to their consultants because they are wrong. I think the reason why DCL is successful is because they thought big (and charged a high covercharge). Once they start thinking small, nickel and dimeing customers and their employees, things start to go downhill. Soon they become like the airlines where everything's poorly organized, dirty and miserable-- with miserable employees. It's not the food or the shows that makes DCL line special. They are okay but not amazing. What makes Dcl special is that there was nothing that jumped out at us as tacky on that ship (except the charge for popcorn at the theatre). What makes dcl special is the little things: their old alcohol policy, Mickey mail, that they call your name out when you step onto the ship. The theming and staff training are also excellent. But we didn't go to one character event. So it wasn't the characters. It was not having to worry about being nickel and dimed, not having to worry am I on this drink package or that one. We never did the dining plan at wdw because we didn't want to have to think about what we could or couldn't eat. That added stress to our vacation and a kind of war time rationing feel that did not seem like a vacation to us. DCL stands out because they are not cheap, because they have standards. This makes them very unique. DCL is special and I hope it stays special. Since it is very profitable, they should be careful when messing with the formula.

 

[steves100]

One thing I have not seen mentioned........could this be the start of a whole industry cut back.

DCL has cut a few things, the most touchy obviously the drinks issue, which is the most visible one. But so has Carnival and I have been told RCL too. The biggest cut backs and increasing prices has been NCL, with a big expansion of their buy up restaurants into A la carte starting in 2016.

I do believe that the whole industry is slowly working toward *a pay as you eat* system will be the norm in a few years.


AKK

Then we wont cruise

 

[funfam]

We probably are an outlier in the studies (in that we spent almost nothing as first time cruisers), but I don't know that I agree with the idea that the studies are correct. Or maybe I disagree with the idea that disney is interpreting them correctly. I think disney executives need to stop listening to their consultants because they are wrong. I think the reason why DCL is successful is because they thought big (and charged a high covercharge). Once they start thinking small, nickel and dimeing customers and their employees, things start to go downhill. Soon they become like the airlines where everything's poorly organized, dirty and miserable-- with miserable employees. It's not the food or the shows that makes DCL line special. They are okay but not amazing. What makes Dcl special is that there was nothing that jumped out at us as tacky on that ship (except the charge for popcorn at the theatre). What makes dcl special is the little things: their old alcohol policy, Mickey mail, that they call your name out when you step onto the ship. The theming and staff training are also excellent. But we didn't go to one character event. So it wasn't the characters. It was not having to worry about being nickel and dimed, not having to worry am I on this drink package or that one. We never did the dining plan at wdw because we didn't want to have to think about what we could or couldn't eat. That added stress to our vacation and a kind of war time rationing feel that did not seem like a vacation to us. DCL stands out because they are not cheap, because they have standards. This makes them very unique. DCL is special and I hope it stays special. Since it is very profitable, they should be careful when messing with the formula.

I think you should send this to DCL. I really think it is a powerful statement and really his the nail on the head. I know they don't seem to care but it couldn't hurt.

 

[eskimoinparadise]

but isn't that what i said? they may not do things to encourage repeaters?

Not really. This is what you said:

i still doubt very much they do anything to discourage repeat cruisers.

My point was that by systematically removing those perks and onboard benefits that encourage people to do additional cruises, they are in fact creating an environment that discourages re-booking. A person does not have to make the journey from satisfaction to dissatisfaction to be pruned from the customer list. All the company has to achieve is to move them to a state of indifference. BTW, that is also why the pruned customer rarely complains - indifference isn't exactly a strong emotional response - you just start looking elsewhere for satisfaction.

 

[darkwing818]

Clearly we are outliers as well. I can't speak for other repeat cruisers, but for us we've taken 15 Disney cruises & I think our spending has increased since our 1st cruise.
On our 1st cruise (2001), we used our DVC points to book the cruise (had a bunch in the bank) we were unsure if we would like cruising & didn't wan to spend "actual" cash. Our 1st cabin had an Oceanview, additionally we spent very little, a few souvenirs for our girls was about it. No Palo or excursions, we just walked around the various ports of call. Eventually we graduated to verandah cabins, started taking excursions, Palo dinners & brunches and more souvenirs. Our last 5 cruises have all been Concierge staterooms, the addition of "Tastings" has also bumped our spending. Dinners, Brunches & Dessert experiences at Remy has also taken a bite out our cruise dollars.
Personally I think DCL wants to hold on to cruisers like us & is not trying replace us with 1st time cruisers. Again just my opinion. Flame Away......