Last-minute deals: What I’ve learned, and what I’d recommend (or not)

(If you’re not interested in reading my nerdy treatise on cruise pricing, you can skip ahead to the advice for getting last minute deals.)

Understanding how to get a last-minute deal on a cruise comes down to just three words: Supply and demand.

I was a good student in college, but introductory economics was possibly the hardest class I took during my four years. Some of the concepts just seemed completely foreign to me, and I couldn’t wrap my head around them. I despaired over studying for the tests, but eventually I figured out how to make it work – and I’ve never been so proud in my life to get an A-. (See, I told you I was a nerd.)

So imagine my surprise when I learned that the pricing structure of the cruise industry, for the most part, is driven largely by supply and demand. Good thing I paid attention in that Econ class!

To understand cruise pricing, it helps to think from the perspective of the cruise line: They’d like to have every cabin on the ship booked as far ahead of time as possible. That way they know they can count on the revenue from that sailing. This explains the bonuses you might see for booking ahead, or lower prices for sailings more than a year out. (Unfortunately, it also explains the recent introduction of nonrefundable deposit fares, which are lower but can’t be changed or refunded if you find you can’t take the cruise you originally booked.)

At some point, the cruise line will notice that for a certain sailing, the supply is far exceeding the demand. This can happen as far out as six months or so, but it’s most likely to happen 90 days out, which is when the final payment for the cruise is due. Once final payments have been made, the cruise line has a much clearer picture of which cabins are bought and paid for – and which ones aren’t.

Of course, the cruise line doesn’t want to let any cabin be empty on any sailing. An empty cabin means there aren’t passengers to buy drinks at the bar, purchase shore excursions, or gamble at the casino. So on a sailing where supply exceeds demand, the cruise line relies on one of the oldest tricks in the book and lowers the price. Often, this does the trick, and the cruise sails mostly full.

You can see this most clearly in the case of transatlantic cruises, where the cruise lines reposition their ships from Europe (where they sail in the summer) to the Caribbean (where they sail in the winter), and vice versa. These ships have the same number of available cabins as they always do, but the demand is much lower: Because these are longer cruises, and often include a lot of sea days, there aren’t as many cruisers who are interested and willing – or even able – to take these cruises which can often be 12-15 nights in length.

Continue to Part II: Advice on how to get a last-minute cruise deal

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