Cruise Lines Test New Ancillary Fees

Ancillary revenue is becoming a critical focus for cruise lines, moving far beyond traditional add-ons like specialty dining or spa treatments. The industry is now delving into more granular charges, such as Royal Caribbean's recent move to require a $4.99 souvenir cup purchase for access to Coca-Cola Freestyle machines, even for guests with premium beverage packages that cost over $70 per day. This change, effective March 15, 2026, still includes canned and fountain sodas from bars but unbundles the self-service machines. This trend extends beyond a single cruise line. Carnival Cruise Line, for instance, has increased its onboard service charge from 18% to 20% and raised prices for its CHEERS! drink package and Wi-Fi services. These adjustments are part of a broader industry effort to maximize onboard spending, which is a significant contributor to overall revenue. Norwegian Cruise Line (NCL) has also experimented with new charges, introducing a fee for additional main-dining-room entrees and no-show fees for specialty dining reservations. However, NCL has also demonstrated a willingness to retreat from unpopular changes after customer backlash. A recent example was the reversal of a menu update at its Cagney's Steakhouse that had eliminated guests' ability to choose their own side dishes. More significantly, NCL has walked back its "More at Sea" bundled package program after just under two years due to customer feedback that it was confusing and less flexible. The line has reverted to its more popular "Free at Sea" model, signaling a response to customer dissatisfaction. This move comes as the company faces pressure from activist investor Elliott Management, which has taken a significant stake and is pushing for broad strategic changes to address what it calls a "decade of strategic misjudgments and poor execution". The pressure from investors on NCL is focused on larger issues like corporate governance, cost discipline, and maximizing returns on major investments like private islands, where competitors are seen as generating significantly more revenue. While there isn't a direct public link between the investor's demands and specific ancillary fee reversals, the overall situation highlights the delicate balance cruise lines must strike between generating revenue and maintaining the customer satisfaction that is crucial for long-term loyalty and bookings. The new NCL CEO, John Chidsey, has acknowledged past "missteps" and "misalignment" and has stated he is open to shareholder perspectives.