My opinion on why upgrades happen, and it seems logical, is the closer a cruise gets to departure, the cruise line is more likely to want to have the higher category cabins booked and if they cannot fill them all with people that booked that category they start upgrading people. It makes more business sense to upgrade someone to a higher level, encouraging repeat business, while leaving a few cheap cabins unoccupied, than to leave the more expensive ones unoccupied, thus ulitmately costing them more money. Basically it amounts to luck of the draw most of the time it would seem. Who knows, I might be lucky enough to recieve an upgrade from a Category 1A(Inside Single) to an Oceanview(I wouldn't expect more if I were lucky enough to get one) but we will see.
You are almost right. If the ship is too empty close to sailing, they start upgrading. Pleasing those already booked doesn't hurt, but the primary reason is that it is easier to sell the cheapest cabins. Move everyone up the cabin hierarchy, then slash budget priced cabins to the bone. The ship gets more bookings, loses less money than discounting expensive cabins and a few folks get killer last minute deals. Plus, advertising really inexpensive cruises is good PR. Doesn't happen as much as it used to, it seems, but we used to jump on those a lot.
The inexpensive cruise thing is how I plan to sell my first group cruise. Give them a rebate from my commission plus spreading out the value of the free cabins, and make them even more happy with an already low fare. Since I am giving a rebate from my commission it would build customer loyalty and it would not be breaking any of the cruise lines rules. A very good marketing strategy indeed.
They can upgrade any cabin, but I think they start with guarantees. I don't know if the lines start looking to push other pax up as cheaper cabins begin to reach some capacity control.
Just remember with a guarantee you can be at tle lowest category that you are guaranteed. And probably most likely so if the ship is not crowded.
A Bad Day At Sea [with power] Always Beats A Good Day At Work
Alaska 2014 - haven't picked a cruise yet
Carnival: Glory 2004, Destiny 2008, Splendor 2009, Freedom 2011, Valor 2012
Celebrity: Summit 2011
Princess: Ruby 2010, Caribbean 2013
We took a 34 day South Pacific to Hawaii repositioning in May 2007. We booked an outside guarantee and were thrilled to find our assigned stateroom had a balcony!! Not such a big deal on a short cruise- HEAVEN on an extended cruise!! Bless you Cruise Fairy!! Now if you will be so kind on the 74 day cruise I just booked- I will love you forever!!