Seatrade Global Roster: The Cruise Industry Looks Ahead | TravelResearchOnline

Image
Image

Seatrade Global Roster: The Cruise Industry Looks Ahead

Half the cruise ships are sailing, carrying half the passengers they once did. At each port, they are beset by differing and ever-changing protocols, negotiating life-and-death decisions with new players with whom they do not have the usual long-term relationships.

And yet, guest satisfaction is off the charts. The new-to-cruise customers that many expected to be frightened off are instead showing up. New ships and new partnerships, new terminals and new ports are on the horizon—and they promise to share the wealth with local communities and to promote a healthier environment for all.

“We built this industry over more than five decades; we deliver a phenomenal experience that our customers love, and the Caribbean is an unbelievably popular destination for our core markets,” said Royal Caribbean International president and CEO Michael Bayley at the Caribbean Spotlight: A Focus on the Future breakout session. “We need to just stay focused and trust each other and, in another year or so, we’ll be looking back trying not to remember any of this.”

In short, this week’s Seatrade Global conference was unlike any other, as the biggest names in the industry told tales of endurance, hardship, and cooperation they never could have imagined two years ago. Then they shared dreams of what the next few months will bring.

 

Richard Fain, Royal Caribbean CEO

 

Some highlights and forecasts:

*In its core markets, Royal Caribbean Group expects to be sailing essentially 100% of its ships by the end of 2021, chairman and CEO Richard Fain said. It’s been a very difficult year—and one thing that has been of particular concern to travel advisors and other partners is the constant cancellation of cruises. “So I think it’s very important to get the flywheel going.” By the time WAVE Season starts, Royal Caribbean expects to have all of its ships operating, so its travel advisor partners need not worry about cancellations. “We really need to get back to a period of stability, and I think getting our ships back is a good way to do that,” he said.

*The 56% of cruise capacity that is currently sailing will grow to 80% by the end of December, with 220 ocean-going vessels carrying guests who “recognize cruising as the world’s safest holiday option,” said Pierfrancesco Vago, executive chairman of MSC Cruises and chairman of CLIA Global. It’s been an incredible experience, working through protocols with “every single little health authority around the world,” in the ports, in the cities, in the regions, in the ministries of health across Europe, with the EU in Brussels. But “we put our heads together and that’s what brought us back to safe sailing.”

*The most common theme: Cruising will take its place as the safest, and therefore the foremost, travel experience in the months to come. There is no other industry that controls the entire travel experience end-to-end like a cruise does. “Now that we know how to handle the virus, I believe there will be no safer way to travel and that will truly become an advantage. The future is bright,” said Celebrity Cruises VP of Marine Operations Manolis Alevropoulos.

*The cruise lines should “listen to the travel agent professionals you are working with” when developing new products and features, said Carnival Corp. president and CEO Arnold Donald. “If you listen to the people who have been at this a long time, to the travel professionals, you can do well.”

*Expect to see a shift to cruises that stop in fewer ports but stay longer, including overnight, said MSC Cruises President Ruben Rodriguez. That offers a better, and more relaxed, guest and crew experience while saving on fuel and emissions. And on a boatload of experienced cruisers, most don’t want to go to seven ports; they’d much prefer to have an enriching experience, come back onboard for a shower and then return to shore for the evening.

*While everyone is optimistic, the cruise return will take a little longer. David Selby, managing owner of Travelyields Ltd, expects that getting back to 2019 numbers will take until 2023 or even later. Still, he said, we’re going to see higher numbers in 2021 than in 2020, and next year we’ll really see an increase. “So I’m confident about next year. A steady return beckons.”

*While some had predicted that Millennials would be slow to return to cruising, Carnival’s data show that the market is actually “over-indexing” thanks to the number and quality of experiences cruising offers, Donald noted.

*And so are the first-timers, said Fain. “We all assumed that, when we started back, it would be repeat customers and it would take years to penetrate [the new-to-cruise market]. But first timers are coming.”

*The good news about COVID is that while cases are being reported, the protocols do work. Royal Caribbean Group VP of Worldwide Port Operations Hernan Zini said the line has handled 146 cases, most asymptomatic. “In the Caribbean we haven’t left one single guest or crew in a hospital or hotel overnight; we’ve been doing this safely and without putting a burden on the destination,” he noted. While that’s been relatively easy so far in the Caribbean, where private air ambulances fly infected guests to their front door, it will be a challenge as European guests begin to return.

 

Kelly Craighead, CLIA President

 

*The increasing importance of environmental standards will push investment in shoreside infrastructure that provides onshore power for cruise ships—“a perfect example of public-private partnerships,” said CLIA president and CEO Kelly Craighead. Above all else, she noted, the key to overcoming the challenges of the past 18 months has been an open collaboration among epidemiologists, government health authorities, tens of thousands of businesses like shipyard and ports, travel advisors, and suppliers. “Each one has a story to tell, and it’s usually about putting people first and innovating solutions to the challenges in front of us.”

*Is Fain worried about Richard Branson’s foray into cruising? Not at all. “New players are a benefit because they attract attention,” he said. When Disney got into the cruise business, it added 2% to the supply—and 10% to the demand. The cruise lines’ real competition is land-based vacations, hotels and resorts, and even widescreen TVs. “Having Virgin come in adds to the impact of the cruise industry. I welcome them.” MSC’s Vago was even more outspoken. Cruising is a very complex business because you have to understand both ship building and hospitality, he noted. “Virgin is a great brand, but I think that building three ships without really testing them on the market will be a complexity.”

*When dealing with governments, Donald said, the most important thing is to be “science based, fact driven, and risk managed.” While things are headed in the right direction, it is important for everyone to keep the conversation going, to make officials around the world understand the impact of the industry and how many are dependent upon it. We are not through this yet; the cruise industry is still constrained in many ways. “We have to continue to champion the industry and request that we are treated like other sectors.”

*It will be key for regions to develop protocols that allow ships to easily sail from one port to the next. This is of special importance as we approach the winter season in the Caribbean, and “we are not there yet,” says Royal Caribbean’s Zini.

*The port experience will be upgraded, involving and supporting local communities and quickly immersing guests in the destination. Expect to see local artisans telling the story behind their works, shifting the port experience from “buying a souvenir” to “bringing home a human memory” of the people they met at the destinations visited. Construction will focus on local sourcing and hiring, and inviting the community to use the space when there is no ship in port.

*In addition to being able to hold larger ships, new port projects will focus on the comfort and speed of embarkation for guests and crew. RCCL’s new terminal in Galveston, for example, plans to move guests “from the car to the bar in 10 minutes,” says Royal Caribbean Group director of development Jayne Holcomb, and to hold them comfortably for long periods when fog or other issues arise.

*In Nassau, 51% of the new cruise port will be Bahamian-owned, and care will be taken to ensure that the shops do not duplicate, and therefore compete with, what already exists on Bay Street, said Nassau Cruise Port Ltd. CEO Mike Maura Jr. Funding will be provided to give small business owners grants and zero-interest loans to open shops, and buy equity in the project.

*While guests want to be safe on shore excursions, they don’t want to just sit in a coach and watch the world go by; “that’s not how they view safety,” says Azamara director of land program development Gina Dunnett. Private tours give folks who are concerned about safety a way to travel without being afraid. They want to be outdoors and they want to relate to the locals.

*RCI’s Bayley noted that over time the crew mix has shifted steadily from the Caribbean to Asia, and to the Philippines in particular—thanks to clear seafarer rights regulations that support “both the seafarer and the employer.” Taking its name seriously, Royal Caribbean has begun discussions with Caribbean nations to begin moving the statistics in a more positive direction.

“What a journey we have all been on,” said Carnival cruise Line President Christine Duffy. “This is not the first crisis this industry has faced, but this one is pretty unimaginable. We have to all keep our guard up and stay focused; we have a long way to go and everyone is watching everything we do.” The cruise industry does have two big advantages, though: its loyal customer base and its long docket of crew members anxious to come back to work.

 


Cheryl’s 40-year career in journalism is bookended by roles in the travel industry, including Executive Editor of Business Travel News in the 1990s, and recently, Editor in Chief of Travel Market Report and admin of Cheryl Rosen’s Group for Travel Professionals, a news and support group on Facebook.

As an independent contractor since retiring from the 9-to-5 to travel more, she has written regular articles about the life and business of travel agents for Luxury Travel Advisor, Travel Agent and Insider Travel Report. She also writes and edits for professional publications in the financial services, business and technology sectors.

Share your thoughts on “Seatrade Global Roster: The Cruise Industry Looks Ahead”

You must be logged in to post a comment.







Image