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Friday, November 28th 2014

"I'm a travel junkie who's hooked on deals from YVR." - Chris Myden



2011
22
February
How to get the best deal on an all inclusive package

When it comes to all inclusive vacations, this is the question most people want the answer to: 'When should I book to get the best deal?'

To clarify, 'all inclusive' in this case refers to a package with flight, hotel, food, and drinks and 99% of the time it's to Cuba, Mexico, or the Dominican, AKA the Big 3 of all inclusive traveling. Some people like to throw around the term 'all inclusive' when referring to a flight and hotel (only) package to Vegas or Hawaii or other destinations. To most people though (at least in Canada), the term all inclusive involves food and drinks.

I think it's important to understand exactly what your options are when looking for an all inclusive package. It may seem like there's an overwhelming variety of places to search and scour, but in reality there's really only 2 worlds of prices available to us Canadians.

World #1 - The Canadian Tour Operators

(ie: Sunwing, Transat Holidays, Nolitours, WestjetVacations, etc)

If you've ever searched for an all inclusive vacation on a Canadian based site like RedTag, SellOffVacations, ITravel2000, Escapes, FlightCentre, or FlightNetwork you were searching for prices from the Canadian tour operators. To save my fingers from some typing, I'm going to refer to them as the CTO's from this point on.

I'll give you a hint, if you've ever tried to price compare the CTO's all inclusive package prices between various sites, you're essentially wasting your time. They'll always be the same price.

However, the CTO's generally have very competitive prices. And for the most part (but not always) their flights are decent, either with minimal stopovers, or direct, because they make use of all the charter flights out there.

So, when do the CTO's offer the best price? As is always the case in the world of travel prices, there's never a perfect answer for all situations. There are a few patterns that stand out to me though.

The first is that prices generally don't budge a whole lot, until you get close to about 4-5 weeks before departure. That's when the CTO's will occasionally start to get nervous about not having enough seats filled. There's no guarantee that prices will drop, there's never a guarantee of anything when it comes to markets, but I have noticed if they *are* going to start to drop, it will be around this point. It's at about this point in time that you'll usually see the lowest overall average price, across the largest variety of packages.

Here's a chart showing the median price of an all inclusive package from Calgary, to a 4* resort in the Mayan Riviera, as of the writing of this article.


We can see that right now, the 3rd week of March has the lowest median price which is about 4-5 weeks from now.

You can also see there's a large spike in the price around the last week of March. It's no coincidence that March 25th is the last day of school for Calgary, before their midwinter break. Plenty of people will be taking their families on holidays, which means increased demand, which means higher prices.

Interestingly enough though, Easter is quite late this year, and doesn't seem to be subject to higher prices than usual.

That gives us a look at prices out West, but how about out East? Here's a look at Toronto:


Again we can see that about 5 weeks ahead offers the cheapest price, although it doesn't be appear to be significantly cheaper than 2 weeks ahead at the moment.

What is noticeable however, is a large spike around the 2nd week of March. Just like with Calgary, it's no coincidence that this is when Ontario schools let out for midwinter break. These are just two example cities, the situation will be similar from all cities.

If you're ever looking to go on an all inclusive vacation, just ask yourself, are there a lot of other people with holidays at this time? If the answer is yes, expect prices to be higher, and the chance of an unusually good price to be quite low.

When it comes to the *really* insane prices, those are usually to be found with less than a week to go. The problem is though, it's usually to just a few select resorts, while the specific resort you may have been hoping for stands a good chance of having a higher price than was available previously. That's a classic example of flexibility vs price in the world of travel.

I'm sure there's plenty of people out there that wait for a 'last minute' deal to a specific resort, only to be disappointed. To lower their odds even further, most people also narrow it down to a specific date range. The chances of a truly great deal happening on the exact dates you want, to the exact resort you want are pretty remote.

There are also overall price trends throughout the year. Christmas of course, is just ridiculously expensive, with the off-the-charts level of demand. I've found that the average Christmas all inclusive package is usually at least 1.6X a normal, decent price. Basically, anything that involves 'over' Christmas is going to be the worst of the pricing, but anything between Boxing Day and January 7th or so is going to be nearly as bad. The chance of a great deal during the holidays drops to nearly zero, no matter *when* you buy, although there were a *few* decent deals in 2010, and I do mean few.

Anoter bad time of the year to hope for a good deal is around the third week of February. Spring break, Reading week, Family Day, President's Day, and Christmas credit card bills being paid off all combine in a perfect storm to make sure there are impossibly few good deals to be found anywhere warm.

The shoulder seasons usually have some amazing deals, such as November up to mid December. Then the prices get ridiculous for Christmas, then they come back down to earth around second week of January, but still higher than the shoulder season, as winter sets in across Canada and people start looking to get away.

During winter, there are still insane deals to be had for sure, but less frequently than in the shoulder season. Then comes April, and you're into the opposite shoulder season. There are still charter flights flying to warm destinations, but they're starting to wind down towards the end of April.

As you get into late spring and summer, people might think, it's warm here, so there's probably always some amazing deals down south. While demand might be lower due to the warmer weather here, don't forget that less charter flights also means less supply, which is the other half of the supply/demand function that determines prices in the market. And there's also a lot of people that take holidays during the summer. During the summer, you also stand a much better chance of having your vacation ruined by a hurricane down south, especially as you move into August/September.

Then as you get into late fall (end of November is approximately the end of hurricane season down south), and the charters ramp up the number of flights again and the cycle starts over.

World #2 - Everything Else

(ie: packages from Expedia, Travelocity, Orbitz, Bookit)

I know that sounds intimidating, 'everything else'. By everything else, I mean sites that aren't offering packages from the Canadian Tour Operator's mentioned above. This includes sites like Expedia, Travelocity, Orbitz, Bookit, etc, basically any of the big (usually American owned) travel sites out there.

It sounds like an overwhelming task, with you wasting your precious time examining them all. I can tell you that 99.9% of the time though, you'll find their prices to be pretty much identical to each other. They're basically just taking fares from the major airlines (which are the same everywhere) and mashing them together with whatever the latest hotel prices are (which are virtually always the same everywhere).

In terms of 'all inclusive' packages, as in the ones involving food and drinks, you basically just need to search for a 'flight + hotel' package and look for the ones that contain the word 'all inclusive' in the title of the hotel. That way, you're comparing apples to apples with the CTO's above.

If you search for a flight + hotel package and it doesn't have 'all inclusive' in the title of the hotel, well, you're probably just getting the flight and the hotel. On some of them though, once you select the flight + hotel package, it will give you the option of making it an 'all inclusive' (ie: food and drinks) for more money.

One problem with World #2 is that these flight and hotel packages will be initially mashed together with the cheapest flight option, which can sometimes be a completely moronic flight, like a 20 hour flight with 2 or 3 stopovers. You just have to watch out for that, and you can usually pick another flight, but the price will be higher of course. With the CTO's, as I mentioned earlier, most of them are charter flights and are usually decent flights (but not always!).

About the only other thing often missing from World #2, that's usually always included from the CTO's, are the 'transfers', which just means a way of getting from the airport to the hotel. Often you can just figure out a cheap way to get to the hotel yourself (bus, taxi, etc) so it's not really an issue, but it's just something to consider when comparing the two worlds fairly.

So, when's the best time to buy from World #2 ? A large part of it generally depends on what the flight prices are. Unlike with the CTO's, you are *rarely* going to see a last minute deal from World #2. Why? Because last minute flight prices on the major carriers are usually very expensive (unlike the charter flights that the CTO's use).

The world of flight prices could cover a whole separate blog post, but generally prices are at their most decent about 2 months ahead (this is a very general rule of thumb though). In World #2, you also have to hope that some all inclusive hotels have decided to offer a decent discount on their prices, in order for both the flight + hotel price to be a good deal. You kind of need two stars in this world to align, the first being an unusually good flight price to a warm destination from your city, and an unusually good hotel deal at the same time.

A lot of the same general rules of thumb in terms of seasons apply here of course. Christmas packages will always be expensive in World #2 as well, because flight prices will always be expensive around Christmas. And any time a large number of people are taking their holidays at the same time as you, it's rare to see great prices.

Bottom Line:

- It never hurts to check both worlds, just be sure you're comparing apples to apples, in terms of what you're getting.

- I find that the CTO's generally do have the most competitive prices, but that's certainly not *always* the case.

- 4-5 weeks ahead is usually a good time for decent overall prices from the CTO's, just don't expect anything decent over Christmas or around the third week of February.

- Watch for the crazy sell-offs from the CTO's with under a week to go, but be open to anything, anywhere.

- Keep in mind these are just general trends, there's never a guarantee of anything when it comes to the world of travel prices.

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Chris Myden









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