RCCL “Price integrity" policy adopted in 2015 increasing Profits

RCCL reported increase in revenue and profits as their 3 cruise lines are riding the crest of a 2017 wave. "Part of it appears to be industry-wide," RCCL benefitted from a host of positives in the second quarter, "All of our brands are performing at a level we've simply never seen,"
One program Fain cited as responsible for RCCL's momentum was the "price integrity" policy adopted in early 2015, which put curbs on discounts late in the sales cycle. One idea behind the program was to reinforce the pledge that bookings far in advance of sailing would carry the lowest prices.  Fain said the policy, as expected, cost revenue in 2015 and 2016, but as consumer behavior shifted it has now contributed to the robust 10% increase in revenue yields that RCCL recorded in the second quarter. 
"Once we established our consistency and credibility with the travel agents with the public the benefits started flowing in,"  Parallel to the price integrity program, RCCL has been pushing out the booking window by getting passengers to commit a longer number of days before departure when purchasing their cruise. 
With less inventory to sell, the remaining cabins are in shorter supply, leading to higher close-in pricing, prompting more early booking, a virtuous cycle. Fain said RCCL's booking curve is at record levels, and that rather than try to ratchet it out further, the company will now be spending more time trying to bring up prices.
RCCL CFO Jason Liberty said that while most itineraries have benefited from strong consumer confidence in North America, it has been particularly evident on European sailings. "Fewer geopolitical events and stable air pricing have contributed to a surge in demand from our higher-paying North American guests," Liberty said. "As a result, North American guests will account for a larger percentage of Europe itinerary sourcing than in any other recent year."
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