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Dispatch From Cruise3Sixty 2012: "Business Outlook"May 2, 2012 By: Susan Young
|Left to right: Rudi Schriener, President and CEO, AmaWaterways; Bob Lepisto, President, SeaDream Yacht Club; Christine Duffy, President and CEO, Cruise Lines International Association // All photos by Susan J. Young|
How’s business? What's up with cruise sales? What's the outlook for the remainder of this year and early 2013?
During a cruise3sixty General Session at Port Everglades late last week, Christine Duffy, president and CEO, Cruise Lines International Association (www.cruising.org) put those questions to a panel of cruise executives. The group represented large oceangoing lines, a mega-yacht line and a river cruise company.
Participating were: Dan Hanrahan, president and CEO, Celebrity Cruises (www.cruisingpower.com); Bob Lepisto, president, SeaDream Yacht Club (www.seadream.com); Rudi Schriener, president and CEO, AmaWaterways (www.amawaterways.com) and Rick Sasso, president and CEO, MSC Cruises USA (www.msccruisesusa.com).
Here's their personal views on the business outlook.
Improved Oceangoing Picture
While the year began strongly, the executives representing the ocean lines acknowledged there was a blip in booking momentum post-Concordia. But that's now dissipating, they said.
“For the fourth quarter of this year and first quarter of next year, bookings are ahead of where they were at the same time last year.” said Hanrahan. “Rates are in good shape.”
He told the agents in the audience that experienced cruisers fortunately did not become “cruise rejectors” after the accident. Instead, these cruisers viewed the incident as an isolated one.
Sasso also acknowledged there was a hiccup post-accident, but that business began to return very quickly after a few weeks. He also noted that most cruise lines ceased any advertising right after Concordia.
Now the ads and promotions are back and people have an appetite for cruising once again, Sasso said. Europe still has some challenges, but Sasso said “there should be a greater opportunity over the next two months."
|Left to right: Duffy; Rick Sasso, President and CEO, MSC Cruises USA; Dan Hanrahan, President and CEO, Celebrity Cruises|
Confidence is Returning
On the luxury side of the marketplace, Lepisto said: “I see it as a year that’s going to be a good year, with the opportunity for it to be a very good year. There is such incredible value out there, and you’re seeing many of the offers and opportunities at the luxury end.”
One positive step is that luxury customers are now seeing their portfolios and consumer confidence moving in the right direction. For Lepisto: “I personally think there is a lot of pent-up demand.”
He stressed that agents need to continue to articulate the incredible value clients receive on a luxury cruise – compared with the cost and inclusions of a land-based stay in such cities as London or Rome.
For 2013, the full-yacht charter business, both on the incentive side as well as for individuals who want to celebrate an anniversary or special occasion, is tracking “ahead of pace,” said Lepisto. “Companies now have a lot of money and they’re looking to spend it to increase their sales [with incentive travel for top employees].”
Duffy emphasized that she sees much opportunity for agents on the small group side and on the corporate side, as companies are again seeking opportunities for their meetings and incentive travel.
“That’s a great business driver for the agents here,” she said.
River Sales Are Booming
Schriener, whose line christens its new AmaCerto in Europe this month – with Duffy as the godmother - said: “This is our 10th year. It is a fantastic year.” He told the agent attendees that he’s never seen a season as full as this year’s season so early.
“Several months ago pretty much our whole summer period for 2012 was sold out,” he stressed. Other than the Christmas market and holiday cruises, the typical European river season is mid-April to mid-October.
“During the September and October period [for 2012], we could sell three times as many ships [berths] as we have,” Schriener said.
Eighty to 90 percent of AmaWaterways' time is spent on marketing the low season, and so, about four years ago the line started wine cruises during these periods.
The effort struck a chord with consumers. “Last year we offered six wine cruises, this year we have nine and next year we’ll have 21 wine cruises,” said Schriener.
Trends this year in river cruising? He cited a greater luxury focus, larger cabins, multiple restaurants on vessels, more onboard amenities and a greater focus on land excursions.
Agents have superb business opportunities, he said: “We still haven’t scratched the surface of the potential clientele."