Royal Caribbean CEO rejects changing to all-inclusive cruise prices

It doesn’t look like Royal Caribbean will offer all-inclusive prices for a cruise anytime soon.

Royal Caribbean cruise fares typically offer a modular approach to pricing, where the base fare gets you on the cruise with a certain subset of included amenities.  Everything else costs extra, including shore excursions, most drinks, gratuities, and more.

Other cruise lines have recently made a shift to include more in their cruise fare, such as Celebrity Cruises which includes a basic drink package and internet package with its All Included fare.

A travel agent sailing on a preview sailing of Icon of the Seas asked Royal Caribbean International President and CEO Michael Bayley if his cruise line would make a similar move, and Mr. Bayley balked at the suggestion.

Half of passengers don’t want a drink package

It doesn’t seem like Mr. Bayley sees a need to include a drink package as part of the cruise fare.

Celebrity’s drink package is similar to Royal Caribbean’s deluxe beverage package in the sense it includes many extra cost drinks, such as beers, cocktails, sodas, and more.

Read more: Royal Caribbean drink package guide

“Our strategy has always been the unbundling of pricing to give people as much choice as they possibly can,” he explained in answering the question.

“Our research says that around about 50% of the guests don’t want a beverage package.”

The average cost of Royal Caribbean’s top drink package is around $65 to $105 per person per day, depending on the sailing.

“We’ve learned that unbundling is much easier and better for the guest. It also gets the price point in front of the customer, especially for families. And remember family is our is our real core target market.”

Royal Caribbean’s commitment to being a family cruise line above all else is self-evident with the launch of Icon of the Seas, which it considers the best alternative to a family land vacation to a place like Walt Disney World in Orlando, Florida.

Icon of the Seas features more for families to than any other ship before, and not just kids. It’s designed for every member of the family.

The ship has eight neighborhoods offering an entire waterpark onboard, FlowRider surf simulator, mini-golf, and rock climbing.

Chill Island has seven different pools, with plenty of chairs nearby to enjoy the sun or shade.

Surfside is an entire area of the ship designed for young families. Parents can enjoy the Water’s Edge pool at the back of the ship, while their kids enjoy Splashaway Bay and Baby Bay. Surfside also has three restaurants, an arcade, carousel, and lots of things to climb.

Unbundling offers choices

Mr. Bayley’s comments focused on how much customers prefer having the discretion to add-on certain extra charges, rather than paying more up-front for a cruise fare.

“When you unbundle everything, it gives people choice and it pushes the pricing closer to their budget, which is a really important thing for families,” he continued. 

“We feel like the pricing strategy that we have on the bundling, unbundling is the right path to go.”

Mr. Bayley’s comments echo what travel agents have been told before.  In 2020, Royal Caribbean Director of Revenue Strategy, Brittany Briggs, had a similar response when her team was asked during a webinar about all-inclusive pricing.

“We’re a multigenerational cruise line with a lot of family sailing with us, so we do want to continue to be a family brand. I don’t think this direction is a good fit for us,” Ms. Briggs said.

“At this time we’re not considering changing our pricing structure as we are truly focusing our on board experience for all of our guests.”

Star Class is the exception

Mr. Bayley was quick to point out that if you move to Star Class cabins, you’ll get as close to all-inclusive as Royal Caribbean can get.

“Around 10% of our total inventory, it falls into the suite category overall. So I think we’re in the right place.”

Is Crown’s Edge too expensive?

Speaking of things that cost extra on a Royal Caribbean cruise, Mr. Bayley also took time to address concerns that the Crown’s Edge experience is too pricey.

Crown’s Edge is part skywalk, part ropes course, part thrill ride, and an all-out test of courage.  It’s a ropes course-style attraction that goes around the ship’s Crown and Anchor logo.

The initial price for this thrill attraction was $89 per person for a ride that is listed at taking 90 seconds.

Photo by Vicki Freed

Mr. Bayley pushed back on calls for a lower price because of everything involved to make it happen, “when you experience that and you see what’s involved in it, there’s multiple staff interactions. There’s a huge amount of safety involved in it. There’s a video that records your whole experience that you then receive on your phone. There’s a lot that comes with the experience.”

He also added that pricing helps control demand in many cases for limited opportunity experiences, “sometimes pricing is to manage just the sheer volume of expectations.”

When it comes to pricing, Mr. Bayley believes a higher price is acceptable if the product matches it, “we’ve also learned is that if you have a genuine quality product that ticks the box and delivers the goods to the customer, you’d be surprised at how the customer is willing to pay the price for that product.”

“For example, with the overwater cabanas in Coco Cay. If you’ve experienced the overwater cabanas, it is literally like going to heaven for the day.”

“It’s not cheap, but people have the most remarkable experience and they’re willing to pay for that… We feel like we’re on the right track.”

Ultimately, he is waiting for feedback from passengers on a revenue sailing, “as we go through the next several weeks, we’ll get a lot of feedback from our revenue customers. They are going to tell us that this works or that doesn’t.”