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9. Cruise Sales Trends: Top 12 for 2012

April 9, 2012 By: Susan Young Travel Agent

It’s been a heck of a first quarter for cruise sellers, who’ve had to deal with media reports and customer concerns about global geopolitical issues, the Costa Concordia, norovirus outbreaks and several other negative cruise incidents. After a strong December and early January for bookings, this year’s Wave Season lost a bit of its strong surf post-Concordia.

The good news is that by March, cruise lines were reporting improved sales and it appeared that the picture was brightening. What’s ahead for 2012 in the cruise selling marketplace? Here are 12 trends we’ve highlighted for 2012, based on discussions with cruise line executives, consortia/franchise leaders, agents and analysts.

Rollin’ on the World’s Rivers: If you’re not selling river cruises or increasing your river sales, you’re simply leaving money on the table. River cruising is the top trend cited by the experts we interviewed for this article. While this segment has fewer berths than the ocean side, “river cruising will continue to grow at a faster pace than the rest of the industry,” says Brad Anderson, co-president, Avoya Travel/American Express, San Diego.

Every major river line is taking delivery of new vessels, and construction orders keep flowing. In March, Viking River Cruises announced it would build six more Viking Longships for delivery in 2013. “River cruising continues to emerge as one of the hottest segments in cruising,” emphasizes Dwain Wall, senior vice president and general manager, CruiseOne and Cruises Inc.. “There is a variety of new product coming online in river, and with new ships as well as with new destinations—like the Rhone—we expect to see river sales continue their upward climb.”

Across the globe, AMA Waterways is offering exotic itineraries that combine an African safari with a Zambezi river cruise. Closer to home, two companies are bringing back sternwheeler cruises on the Mississippi River. Global itineraries encompass everything from European rivers to Asian waterways, from Russia to the Pacific Northwest. Uniworld Boutique River Cruise Collection and Avalon Waterways are among several lines offering popular Christmas market cruises during the holidays.


Avalon Panorama
Suite on the new Avalon Panorama is an example of upgraded features being introrduced by river cruise lines.


During its 2012 Travel Trends Survey, Travel Leaders asked its agency owners, managers and front-line agents about what travel locales were hot based on advance 2012 bookings. For "Top Destinations: U.S. and International," European river cruising placed 13th in the survey; that's a hefty jump from its 21st place finish a year ago and a couple of slots above Mexican cruises, which were in 16th place. Caribbean ocean cruises ranked first, Mediterranean ocean cruises fourth.

Everything Old is New Again: In the past, updates to older ships might have simply involved replacement of carpeting and bedding. That’s changed. Today, upgrades are encompassing new amenities and venues, and, in some cases, even more balconies, cabins or decks.

In the contemporary segment, here is a sample of the upgrades. Royal Caribbean International’s $300 million “Royal Advantage” revitalization is resulting in updates to most Vision-, Voyager- and Radiance-class vessels. For example, Rhapsody of the Seas just received the new dining venues of Chops Grille, Giovanni’s Table, Park Café, Izumi and Chef’s Table. That ship also has a new Royal Babies and Tots Nursery, as well as flat-screen TVs and iPads in all accommodations.

If your clients sailing on Norwegian Cruise Line love steak, Moderno Churrascaria, the line’s signature Brazilian steakhouse, is now on multiple ships; Norwegian Star will receive the upgrade this month.

Carnival Cruise Lines, which spent between $30 million and $50 million on recent Fantasy-class, “Evolutions of Fun” upgrades and is revitalizing several ships with Fun Ship 2.0 upgrades this year, plans a $155 million revitalization for Carnival Destiny in 2013. Ruben Rodriguez, Carnival’s executive vice president, ship operations, reports Carnival Destiny will undergo a 49-day dry dock, and emerge with a reconfigured layout, expanded decks, the tri-level adult retreat Serenity, and 182 more cabins. Renamed Carnival Sunshine, “it will have not only as many, but in fact, more features than some of our line’s newer ships,” Rodriguez says.

Not all changes are quite as massive. Regent Seven Seas Cruises will debut Sette Mari at La Veranda on all ships. The new casual restaurant’s name means “seven seas” in Italian. It will open each evening for antipasti and Italian specialty items paired with fine wines.

Expect additional tweaking this year, according to Chris Owen, owner,, who says that "now lines are going back and taking another look at existing venues, reworking them for today's market [to attract] consumers who are looking for value more than ever before."

Safety/Security Questions from First-Timers: More than 16 million North Americans cruised safely last year, according to Cruise Lines International Association. But while experienced cruisers generally understand that cruising is safe and that Costa Concordia’s accident was rare, potential first-time cruisers are increasingly asking whether cruising is free from harm. Expect your agency to be on the frontline in ensuring that these first-timers feel comfortable enough to book.

While no loss of life is acceptable, in the 10 years pre-Concordia, six passengers and 22 crew members worldwide died in cruise-related operations, while Mothers Against Drunk Driving (MADD) reports that more than 15,000 people are killed and 500,000 are seriously injured in the U.S. each year because of drunk drivers.

During last month’s Cruise Shipping Miami conference in Miami Beach, FL, Christine Duffy, CLIA’s president and CEO, credited travel agents with fielding lots of telephone calls post-Concordia. CLIA member lines helped ease fears by proactively undertaking comprehensive safety reviews and by agreeing to always hold muster drills pre-sailing.

You’ll undoubtedly get more questions this year than usual on the safety and security front, especially from first-time cruisers. Talk with your consortia, CLIA or agency group about helpful messages for these discussions. Gerry Cahill, Carnival Cruise Lines’ president and CEO, told conference attendees that “certainly, in the last couple of months, travel agents have very much demonstrated their value to the cruise industry. They’ve been great advocates for the safety of the industry. It’s been great to have a third party speaking on your behalf and travel agents really have done that.”

There’s No Place Like Home: “Airfare for overseas cruises has been a barrier and a challenge, so cruise lines that have positioned themselves with North American home ports are faring well this year,” says Michelle Fee, co-founder and CEO, Cruise Planners. Concurring is CruiseOne's Wall who says that “home porting continues to emerge as a hot topic in cruising, and I personally feel that ports like Baltimore, Galveston and New Orleans will continue to attract new cruisers and new products.”

Clients seeking a cruise closer to home can combine a cruise vacation with a pre- or post-cruise land stay, and for many clients that’s an enticing option. “We have begun rolling out targeted promotions like a free parking program for CruiseOne and Cruises Inc. clients sailing out of Galveston, and we have had a phenomenal response,” Wall says.


Gerald R. Cahill
Discussing the “State of the Industry” at Cruise Shipping Miami are, left to right: Gerald R. Cahill, president & CEO, Carnival Cruise Lines; Adam M. Goldstein, president & CEO, Royal Caribbean International; Daniel J. Hanrahan, president & CEO, Celebrity Cruises; moderator Christine Duffy, president, Cruise Lines International Association (CLIA); Stein Kruse, president & CEO, Holland America Line, Inc.; Kevin Sheehan, president & CEO, Norwegian Cruise Line; and Pierfrancesco Vago, CEO, MSC Cruises.


Avoya Travel’s Anderson says that “if fuel continues to rise in price, as it has in the last six months, then the industry will turn to a higher emphasis on home porting in North America rather than on European deployments.” This could be particularly so if the economy in Europe continues to be a barrier to Europeans taking cruises.

One potential glitch? New U.S. environmental protection regulations will, by August, require cruise lines to burn a different type of more eco-friendly fuel. It’s more expensive and difficult to obtain. Lines are also concerned with some facets of the new rules and are in talks with the United States Environmental Protection Agency to see what, if any, adjustments can be obtained. Ultimately, lines look to the bottom line and could shift ships if the situation goes sour.

It’s a Family Affair: U.S. Travel Association cites statistics that show families who travel with children or grandchildren make up 30 percent of U.S. adult leisure travelers and grandparents traveling with grandkids comprise seven percent. Family travelers take an average of 4.5 trips each year. It’s booming.

The opportunity is that these travelers are looking for accommodations as well as onboard facilities and programming specifically designed for themselves and their families, according to Anderson. Michael Schad, president Seaward Travels, Orlando, also says it’s a positive trend that “families are beginning to realize the value of cruising compared to vacations of similar budget and how far their dollar can stretch while on a cruise.”

Increasingly, suppliers report grandparents are footing the bill for their children, grandchildren and other family members to visit exotic places on their bucket list, such as once-in-a-lifetime journeys to the Galapagos or the wilds of Africa, not just close-to-home vacations in the Caribbean.

The Power of Fresh Ports: Clients who’ve “been there, done that” are always seeking new destinations to visit on port calls, as well as new ports of embarkation/disembarkation for pre- and post-stays. Oceania Cruises plans to visit 15 new ports in 2012-13. Nearly all lines have new port calls or embarkation ports.

Dubai is coming of age as a cruise embarkation powerhouse and opening a new cruise pier that accommodates larger ships. Singapore will complete a $14 million cruise terminal rejuvenation program this month. And Hong Kong is building a world-class cruise terminal at the site of the old Kai Tak Airport.

In the Caribbean, islands like Aruba, Barbados and Curacao, once considered exotic destinations, are now becoming more popular and more often on the cruise lines’ radar, says Owen. He also notes that Carnival Corporation’s purpose-built destinations like Roatan “are getting rave reviews and we expect Royal Caribbean’s first-ever visit to St. Vincent to be a popular move as well.”

Looking ahead into his crystal ball, Avoya’s Anderson says, “In the Caribbean, we’ll see the development of additional ports funded by cruises lines to increase itinerary choices and destination options.”

Volume and Prices Stumble but Stabilize: Carnival Cruise Lines’ Cahill says his line had a strong November, December and early January for bookings, and he thought: “This is a chance for us to get some of the pricing back we lost in 2008,” he said, noting “it was very, very strong.” Then came the Costa Concordia accident, things changed and business dropped off for most of the lines.

Investment analysts, however, have acknowledged that the booking drop-offs were less severe than anticipated (except for Costa), and business in the weeks since the accident has improved. Cruise lines that pulled their advertising are now promoting again. “It hasn’t been as draconian as people have made it out to be,” says Cahill, noting that booking volume for his line between January 1 and February 29 this year increased over the same period a year ago, and those 2012 fares were at slightly higher prices. “It’s definitely not as good as I think it would have been if the accident hadn’t happened,” Cahill said, but personally he sees potential for an increase in his line’s revenue by year’s end. And while pricing isn’t likely going to soar, it’s not diving either.


Celebrity Cruises
Klaipeda, Lithuania, is among the new cruise ports attracting major lines, including Oceania Cruises, which plans upcoming calls. Above, Celebrity Cruises is welcomed at Klaipeda.


So, it appears that customers who have been waiting for deep discounts aren’t seeing them. “They’ve been waiting and that’s not happening,” said Duffy. So lines can hopefully maintain price stability, get more volume back and maybe as the year progresses, even increase pricing a bit.

Reasons for that hope? Dan Hanrahan, Celebrity Cruises’ president and CEO, says his line’s surveys haven’t tracked any increase in so-called “cruise rejectors”—people who say they’d never cruise. Kevin Sheehan, Norwegian Cruise Line’s CEO, says cancellation rates haven’t changed since the accident either.

In addition, the Travel Leaders 2012 Trends Survey showed positive trending in client spending on vacation. "It's important to point out the data that shows nine out of 10 travel agents say their clients will spend the same or more as last year," said Roger Block, president of Travel Leaders Franchise Group.

“Good Ole USA” in an Exotic Way: Put simply, “Alaska is hot…a repeat from last year, Alaska is doing really well in 2012,” says Cruise Planners’ Fee. She cites advantageous price points and relatively good airfares. “It’s also all about great culture and adventure,” Fee says, noting: “People are still looking for experiences when they travel.” And, cruise lines are continuing to refresh their product offerings. For example, Norwegian Jewel debuts this summer in Alaska, while Celebrity Solstice will debut in the Great Land in 2013.

Alaska’s government is also putting sizable effort into keeping the cruise lines happy. Governor Sean Parnell (R-AK), who several years ago successfully tackled the issue of cruise lines abandoning the state due to high taxes and fees, told Travel Agent he is seeing “good progress” in working with the lines, in the number and diversity of cruise ships returning to the state, and in the state’s desire to create a positive business environment.

Elsewhere in the U.S., “one market that, while challenged with inventory, continues to do extremely well for our agents is Hawaii,” says Wall. He cites the new options for cruises from California and also roundtrip from Honolulu. “Even though this market is a bit limited, we have seen consistent demand,” says Wall, noting “I believe Hawaii is one destination to keep a close eye on in the year ahead for the cruise industry.”

The Cost of Going Direct: “The trend toward direct bookings by cruise lines will slow or reverse as the value of travel agents handling the transactions and agencies providing marketing will supersede the benefits of direct bookings,” believes Anderson. But it may not be for all lines. While he thinks some cruise lines will come to a point of truly embracing the travel agency community, he also acknowledges that others may have less emphasis on the trade relationship in the future.

Still, many lines may see the light when looking at the numbers, he says, noting: “The real cost of a direct booking is much higher than just the cost of the employee.” When airlines cut out the agency community, they created massive call centers—taking on not only the employee salaries, but the huge benefit payments and the overhead for facilities.

A World of Food and Wine Buffs: Themed cruises continue to drive bookings. “Top of the list are wine-themed cruises, and some cruise lines have select sailings with special wine-themed shore excursions as well,” Fee says. “Another favorite is foodie cruises, where famous chefs come onboard.” She says such cruises are a great way for agents to reel in new customers.

Most luxury and premium lines have both wine- and culinary-themed sailings. In just a sampling of options, Holland America Line’s Culinary Arts Center program will host more than 60 chefs, cookbook authors and TV personalities from the culinary world this year. With the launch of Riviera next month, Oceania Cruises is expanding and enhancing its culinary enrichment program with the introduction of Culinary Discovery Tours to more than 25 ports worldwide. And on its new Crown Princess, Princess Cruises will create a Chef’s Table Lumiere.

Continuing Airfare Woes: The Airlines Reporting Corporation reports that airfare rose eight percent in 2011. The average ticket cost $346, up from $320 in 2010. Over the next decade, airfares will likely remain high, the Federal Aviation Administration has said in a new Aerospace Forecast Report issued in March. Fuel prices will likely increase, and so will passenger demand. At the same time, airline capacity is shrinking.

In other words, it’s a seller’s market. To get the best price on airfare, many clients are now booking their cruise further out so they have more time to search for the best fares. Many others are burning frequent flyer miles for one or more tickets. “Many of our luxury travelers are now taking advantage of the cruise lines’ ‘air credits’ to book airfare separately from the cruise,” says Frans Hansen, president, The Cruise Web, Calverton, MD.

Globalization Marches On: Figures released by the European Cruise Council last month show an increasing number of Europeans choosing a cruise vacation; in 2011, that number exceeded 6 million for the first time, up 9 percent from 2010. UK is the biggest market followed by Germany, France, Italy, Spain and Switzerland.

Stein Kruse, president and CEO, Holland America Line, has reviewed the potential numbers of cruisers from the UK, Brazil and elsewhere, and says “I cannot help but think about India and China which have very large populations and are growing with wealth and prosperity.”

Kruse adds that even if the industry can only attract one percent of China’s population as potential cruisers, that’s 25 million more guests. “That is achievable and when I look into the future, it’s awfully bright,” he says.

North American brands who have taken delivery of many new ships can also venture further on the itinerary front. Australia has become a cruise ship magnet this year, with multiple lines implementing schedules from “Down Under.” Larry Pimentel, president and CEO, Azamara Club Cruises, says that sailings to South America and Asia are among the hottest sellers his firm has this year. Similarly, “I have seen an increase coming in for cruises through Asia and the Orient,” says Schad. In the Travel Leaders survey, Croatia, Vietnam and Panama were the top up-and-coming destinations. All have strong ocean cruising options, with Vietnam also a blockbuster this year for river cruising.

Based on feedback from its members and advisory board members, “the agency community is continuing to be very bullish” on the cruise industry’s future prospects, CLIA's Duffy stresses. Schad echoes that thought: “Cruising in general continues to show excellent growth potential throughout 2012.”

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About the Author

Susan Young
A veteran of 100-plus cruises, Susan J. Young, is senior contributing editor for cruises – covering ocean, river and niche cruises for Travel Agent and

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