Decisions that spent revenue to keep confidence

Choosing residents over visitors while a vessel was out of service

In late June 2023 a gearbox fault withdrew our main island vessel, which carries 120 vehicles. The relief vessel carried 64. Engineering estimated eight to fourteen weeks for the repair, and the island's visitor season was about to start. Residents depend on the route for medical travel, school staff, groceries and fuel; its tourism businesses earn most of their year in July and August.

Our revenue director and the island's tourism operators wanted visitor bookings left open and the summer campaign continued, arguing that visitors who cancelled would not come back. I proposed priority for residents, medical travel and essential freight, visitor capacity limited to what remained, and a pause in the C$410,000 campaign for the route. The chief executive and chief operating officer agreed. We recovered C$240,000 of committed placements; C$170,000 was lost.

We published a capacity bulletin at 6 a.m. each day in French and English, stating the repair estimate and its uncertainty instead of a hopeful return date. Visitors with bookings were offered another date, a full refund or a standby place. From the third week, after operators showed us their cancellation figures, we added a fixed allocation of twelve visitor vehicles per sailing.

The vessel returned after eleven weeks. Visitor vehicle crossings on the route fell 27 per cent against the previous summer, and route revenue finished C$2.9 million below plan. Our resident confidence measure fell from 71 to 54 in August and recovered to 68 by May 2024. That winter we agreed a written disruption protocol with the island council and business association, fixing priorities and update times in advance.

I would change two things. I would have met the tourism operators before announcing the decision rather than after it, and I would have offered the visitor allocation from the first day. Neither would have cost much capacity, and both would have spared the operators the sense that their season had been settled without them.

Replacing a fuel surcharge with one all-in fare

Until 2024 our cross-bay booking page showed a base vehicle fare of C$68. A fuel surcharge of C$7 to C$12, adjusted monthly, and a C$4 booking fee appeared only at the payment step. About 23 per cent of customers who reached that step abandoned the booking, and price was the commonest subject of written complaints. Counsel had already reviewed the checkout against the Competition Act's provisions on drip pricing. My concern was the customer's experience of that final screen, not a legal finding.

I proposed a single fare of C$84 for a car and driver on a standard sailing, with fuel costs reviewed quarterly instead of monthly. Our chief financial officer disagreed: the monthly surcharge had let us pass on fuel movements quickly, and we would now carry that exposure for up to three months. Commercial carriers asked to keep an itemised fuel adjustment because they pass it on to their own customers. We kept it for carrier accounts only.

The new fare went live in April 2024. For six weeks online conversion fell 9 per cent, because the headline number looked higher than the base fare customers remembered. By late summer it was within 2 per cent of its earlier level. Payment-step abandonment fell to 12 per cent, written price complaints fell 58 per cent over the year, and net revenue per vehicle rose 0.6 per cent. In the third quarter a fuel increase cost us about C$310,000 before the next review.

The change also altered internal habits. Campaigns now quote the all-in fare, and analysts model fuel scenarios before each quarterly review rather than explaining variances afterwards.

What I would do differently concerns frequent travellers. Many residents on both shores use ten-crossing books, whose price had always included fuel. Seeing C$84 where they remembered C$68, they assumed a steep increase. We explained it in a fortnight of notices after launch. We should have written to every book holder before it.

Holding deck space for commercial carriers in peak season

By 2021 commercial vehicles produced about 30 per cent of Marelisse's revenue, yet our reservation system treated a tractor-trailer like any other booking. Visitor reservations opened in January and filled peak sailings months ahead, while carriers usually book within the week. Drivers waited for later sailings, grocery and building-supply deliveries to the island slipped, and two carriers told us that driving around the bay had become more dependable than our cross-bay crossing.

I proposed holding the equivalent of eight tractor-trailer spaces on nine peak daily sailings for carriers on annual agreements, releasing unused space to the public 48 hours before departure. The consumer sales team and several tourism partners objected that peak sailings would look full in spring and then fill late with visitors who could not plan around that. They were right that some visitors would lose early choice. The chief executive accepted the proposal because the island's supply chain and carrier loyalty mattered more to the routes' future than early-booking convenience.

Our commercial accounts team, then five people, negotiated agreements with volume tiers and cancellation terms. Operations set the loading plans; my team built the release mechanism and a separate carrier booking channel.

By the end of 2023, 37 carriers had signed annual agreements, and commercial revenue rose from C$58.9 million in 2021 to C$66.0 million, an increase of 12 per cent. Carriers used 79 per cent of the held space, and the rest was released on schedule. In the first summer, however, consumer complaints about sailings shown as full that later had space rose sharply.

The allocation is now part of the published sailing information, and carrier agreements are reviewed with the island councils every autumn.

I would have explained the allocation publicly from its first day. For six weeks we said nothing, and customers who saw space appear two days before departure assumed we were manipulating availability. A short explanation on the booking page, added late, cut those complaints by more than half.