Cruise Pricing Considerations While the operating profit margin for each cruise line will vary, the

average
margin in the industry is around 10 percent. As the overall industry revenue is now approaching $40
billion, this means that the total industry net income is around $4 billion. Again, on average, cruise lines
only generate around 70–75 percent of their total revenue from passenger ticket sales. The remaining
revenue is generated from the sale of beverages, excursions and tours, shop sales, casino gaming,
Internet access, laundry services, spa and beauty services, photos, and premium dining and alcohol. As
in airline pricing, each cabin on a cruise ship represents inventory to be sold. Due to the high fixed-cost
structure and the relatively low cost of an extra occupied cabin, it is in the cruise line’s interest to sell as
many cabins as possible (much in the same way that airlines seek to sell as many seats at the best
possible price). And like most holid