World Travel Holdings Brad Tolkin Agents crucial to building demand

What will it take for cruise lines to raise their prices? Brad Tolkin, co-CEO of World Travel Holdings, thinks he has the answer: travel agents. Or more specifically, cruise line support for travel agents.

I spoke with Tolkin on Princess Cruises’ new Regal Princess, the venue for this year’s annual conference of the CruiseOne and Cruise Inc. brands, and he laid out his reasoning.

It starts with the relatively low penetration of cruising as a vacation option. By Tolkin’s reckoning it is about 3.3% of the U.S. population. “And we’ve been stuck on that 3.3% for a long time,” he said.

Clearly, more demand will be needed to solve the pricing problem. That’s where travel agents come in.

“The consumer walking into a travel agent is predisposed not to go on a cruise because very few people go by the nature of the numbers,” Tolkin said. “But if a consumer calls a travel agent, then there’s a chance the travel agent will talk to them not only about a resort vacation but a cruise vacation.”

Thus, the best shot the cruise lines have to raise prices and prosper is to funnel demand through agents. “There’s a chance they might suggest a cruise,” Tolkin said. “If the consumer does not walk into a travel agency, that consumer, given the numbers, is not predisposed to going on a cruise. So the way we’re going to get pricing up is by getting more people to cruise.”

Tolkin said cruise lines have made a lot of progress in the past few years in their support for agents, “precipitated by the seismic events that have happened.”

“We’ve made great progress, but that progress can’t stop,” Tolkin said.

Cruise lines need to keep up the marketing dollars, the listening, the product familiarization outreach and all of the other initiatives that keep travel agents enthused about cruises.

“The consumer does not think about cruising when they wake up and think about traveling,” he said. “But if they are presented to a travel agent, if they go to a travel agent, that agent has the best chance of introducing them into the product.”