CLIA restructures membership program for travel agents

By Tom Stieghorst

CLIA logoCLIA has overhauled its travel agent membership program, which for most agents will mean lower costs and additional benefits. Changes take effect Oct. 1.

Dues for individual CLIA memberships will drop from $119 a year to either $99 or $49. Fees at the agency level will remain unchanged at $339 annually for companies that employ less than 25 agents.

In a change that reflects the size disparity among agencies, new gold and diamond level memberships have been created to provide larger agencies and agency consortia and co-ops with more benefits at a higher cost.

Agents who work for CLIA member agencies who also enroll as individual CLIA agents will become eligible for a raft of bonuses and incentives from 25 cruise lines that source passengers from North America.

The benefits include bonus commission on a first booking with a cruise line, preferred rates when sailing, priority access for training, invitations to inaugural sailings and seminars at sea.

The landmark revision evolved over 18 months during a series of more than 85 meetings with agents, agency groups, cruise lines and outside consultants, CLIA President Christine Duffy said.

“Fundamentally the change is moving from what for 40 years has been an agency membership model, to [become] agency and individual agent membership. That’s the big shift,” she said.

The new model will let CLIA build a database of individual agents, rather than just agencies. Currently, CLIA has nearly 13,000 member agencies and another 2,000 individual members.

“We know that they represent 50,000-plus agents, but who those agents are has been invisible,” Duffy said. “Now, each individual agent becomes somebody real, with an ID number where we know who they are, [someone] that we can engage with.”

ChristineDuffyAgents who are members of groups or agencies with gold or diamond designations will be able to buy individual annual memberships for $49.

The new system may not work as well for an individual or small partner agency that must still pay $339 for an agency membership that includes only one $49 individual membership. At the silver level of agencies with one to 24 agents, each subsequent membership is $99.

Duffy said CLIA is “waiving” the $80 application fee that has historically been charged for agency membership.

Agents will not be able to join CLIA without being affiliated with a CLIA member agency, Duffy said.

She said she does not anticipate that agency groups will require CLIA membership, as Signature recently made membership in ASTA a requirement for members.

The full package of benefits from cruise lines is a “hard” value of $3,600, Duffy said.

The specific benefits will vary from line to line and be administered by member companies, Duffy said. Details will be posted on the CLIA website and can be viewed after membership is obtained, she added, but she gave a few examples.

Many will offer a $50 bonus for the first booking; some will offer $75. Cunard Line will offer four $50 bonuses per agent. The bonuses alone could more than pay for an individual membership, Duffy said.

Of the North America CLIA member lines, only Disney Cruise Line is not participating by offering agent benefits.

Duffy also said that only agents with $5,000 or more in annual commissions will be eligible for CLIA membership, but that the policy will be enforced at the agency level. So, if an agency has a novice agent it wants to nominate for CLIA membership, it can do so.

The number of CLIA agency members has been declining since the mid-1990s, driven in part by consolidating distribution, Duffy said. CLIA hopes its new incentives can reverse that trend.

The need for a new membership structure was driven by technological change, the increased number of home agents and the rise of multiple large travel agent host companies and consortia, Duffy said.

In addition, cruise lines offer more product training than ever, especially through online courses and webinars. Cruise and agency leaders felt a need to streamline and coordinate those efforts, Duffy said.

“Our line is 100% behind this new program,” said Vicki Freed, vice president of sales at Royal Caribbean International, “and I hope every agent who is serious about their business and their future takes advantage of this opportunity.”

John Lovell, president of Travel Leaders Leisure Group and, said he’s encouraging the 35,000 agents affiliated with those groups to support the new membership structure.

Carnival Corp. looks to better leverage scale with restructuring

Carnival Corp. looks to better leverage scale with restructuring

By Tom Stieghorst

Royal Princess shipFORT LAUDERDALE — The recent reordering of top executive roles at Carnival Corp. demonstrates the growing focus of Arnold Donald, the company’s new CEO, on bringing tighter coordination to the sprawling company’s 10 cruise brands.

At the same time, analysts and industry observers said last week that it provides new horizons for executives that have been with Carnival Corp. brands for years and are ready for bigger responsibilities.

In one intriguing change, a newly formed Holland America Group would, for the first time, consolidate the supervision of two West Coast-based brands, Holland America Line and Princess Cruises, under a single executive.

Wall Street analyst Tim Conder said he expects that the moves, over time, will lead to greater sharing of data to enhance cross-selling and up-selling among Carnival’s brands.

In an investor note, Conder, a Wells Fargo analyst, said that Donald is taking steps that pave the way to “further utilize the company’s scale and consumer data for revenue and cost leverage.”

At Travel Weekly’s Cruise World event here last week, Donald downplayed some of the emphasis on centralization but then pointed to the brands’ joint operations in Alaska as a model.

“That’s an opportunity to take advantage of our scale,” Donald told CruiseWorld attendees in a keynote speech. “Rather than have two brands with their own motorcoaches, their own rail lines, their own hotels, by combining things, we can be more efficient for the guests.”

He nevertheless emphasized that HAL and Princess will continue to have distinct brand identities.

Arnold Donald at CruiseWorldEarlier in the week, Carnival announced a flurry of promotions that left its executive suite a changed landscape. Four senior Carnival executives were given new roles, three of them stepping up to bigger responsibilities:

• Jan Swartz. Previously executive vice president of sales, marketing and customer service, Swartz, 43, becomes president of Princess Cruises, a role in which she will oversee 17 ships and 22,000 employees in 60 countries. With Swartz’s promotion, Princess becomes the largest cruise line ever headed by a woman.
“She has my full support as she embarks on her new role,” Donald said in announcing her appointment.

• Alan Buckelew. Previously president and CEO of Princess, Buckelew, 64, becomes COO of Carnival Corp. In that role, his portfolio will include maritime and port operations, information technology, ship retrofits and newbuilds, research and development, risk assessment, quality assurance and group strategy and global operations.

Buckelew will also have oversight of Carnival Asia, headed by former Costa Cruises CEO and Carnival Corp. board member Pier Luigi Foschi.

• Stein Kruse. Now president and CEO of Holland America Line, Kruse, 55, becomes CEO of the new Holland America Group, comprising HAL, Princess, Seabourn Cruises and the Holland America and Princess land operations in Alaska.
Kruse will also become chairman of Manco, the U.K.-based entity that oversees Carnival Australia, a role currently filled by Carnival Corp. Chairman Micky Arison.

• Howard Frank. Formerly Carnival Corp.’s vice chairman and COO, Frank, 72, becomes special adviser to the CEO and the chairman. Frank will also continue in his role as chairman of CLIA, a job that has increasingly occupied his attention.

All the changes take effect Dec. 1.

In a statement announcing the switch of Frank’s role, Arison noted that he and Frank have set Carnival’s course at the corporate level for more than two decades.

“For the last 25 years, Howard and I have worked side by side, and I could not have asked for a better business partner,” Arison said.

Recent changes at the top this year, including both the CEO and COO positions, mean that new personalities who were not at Carnival’s helm in 2013 will be leading the corporation next year.

That said, Arison remains chairman and the largest shareholder, while Frank’s decades of experience will prolong his influence. Carnival did not say whether Frank will be renominated to its board.

Conder said the changes were not likely to be disruptive and were part of succession planning at the $27 billion company, particularly in the case of Frank.
He noted that Buckelew has had a “long, experienced career in various operating, financial and executive roles at Princess and Cunard.”

The other executives moving up also have solid credentials. Swartz, who will report to Stein Kruse, holds a master’s degree in business administration from Harvard, a consulting background at Bain & Co. and has worked for Princess since 2001.

Kruse, who will now report directly to Donald, has been president of Holland America Line for a decade.

Scott Koepf, vice president of sales for Avoya Travel, said that Carnival has a deep bench when it comes to executive talent.

“There have been a number of lessons learned in the past few years,” Koepf said. “Now they’re making sure talent is spread around to all of the brands.”

Whether more changes could be coming in either personnel or corporate structure remains an open question. With the creation of Holland America Group, Carnival has streamlined its brand reporting.

There is Carnival Cruise Lines, the largest of the brands, headed by President Gerry Cahill. The North American brands report through Kruse. And the European brands, including Costa, Aida and Ibero, are headed by Costa Cruises Chairman Michael Thamm.

Carnival’s U.K. legacy operations are less tidy. P&O Cruises is under Carnival U.K., headed by David Dingle, but P&O Australia, headed by Ann Sherry, now will be overseen by Kruse. And Cunard Line, while under the control of Dingle, shares a U.S. sales operation with Princess in Los Angeles.

At CruiseWorld, Donald hinted that new brands may be coming into the mix at Carnival. Asked why there was no upper-premium brand comparable to Oceania Cruises, Donald responded, “We’ll see.”

He added: “There are other segments that exist that nobody’s addressed. Finding those segments that are large enough to support ongoing capacity is a key to future success.”

In the short term, Conder said, Carnival Corp.’s key to success lies in the continued turnaround of the Carnival Cruise Lines brand.

In his note, he told investors that shares of Carnival will stay largely unchanged until mid-March, when it may be clearer how the eponymous cruise line’s reforms are progressing.

“We believe it will likely be 2015 before legacy ship retrofit issues are behind and brand reputation rebuilding along with improved operating approaches begin to bear fruit,” he wrote.

Frank to step down, among other changes at Carnival Corp.

Frank to step down, among other changes at Carnival Corp.

By Jerry Limone
Carnival Corp. said Howard Frank will step down as vice chairman and COO to assume the role of special adviser to the chairman and CEO.

Frank will continue as chairman of CLIA.

Frank has been Micky Arison’s right-hand man for the past 25 years. Arison stepped down as Carnival Corp.’s CEO earlier this year, and was replaced by Arnold Donald. Arison remains chairman of the company.

“For the last Alan Buckelew25 years, Howard and I have worked side by side, and I could not have asked for a better business partner. I am looking forward to his continued contributions in his new role,” Arison said in a statement.

The change will be effective on Dec. 1, as will several other management changes at Carnival Corp.

Alan Buckelew, the current president and CEO of Princess Cruises (a Carnival Corp. brand), will be Carnival Corp.’s new COO.
Jan Swartz
Buckelew will have oversight of a maritime and port operations around the world and group collaborative functions, including information technology; group strategy and global operations; ship retrofits; newbuilds; research and development; risk advisory; and quality assurance. He also will oversee Carnival Asia.

With Buckelew leaving Princess, Holland America Line CEO Stein Kruse will oversee Princess as CEO of the newly formed Holland America Group. The move adds Princess CStein Kruseruises and Alaska land operations to Kruse’s current responsibilities of Holland America Line and Seabourn.

Also, Jan Swartz has been promoted to president of Princess Cruises. Swartz is currently Princess’ executive vice president of sales, marketing and customer service.

Swartz will be in charge of Princess’ worldwide operations. She will report to Kruse.

Buckelew and Kruse will report to Donald.