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Frank Del Rio Details New Regent ShipJuly 11, 2013 By: Susan Young
|Prestige Cruise Holdings Chairman and CEO Frank Del Rio|
On Thursday, Prestige Cruise Holdings (www.prestigecruiseholdings.com) ordered a new $450 million, 738-guest luxury ship from Italy’s Fincantieri shipyard. The new 54,000-ton Seven Seas Explorer will become Regent Seven Seas’ first new ship since Seven Seas Voyager launched in 2003.
Putting it in perspective, “the business just calls for us,” Frank Del Rio, Prestige’s chairman and CEO, told Travel Agent and Luxury Travel Advisor Thursday night. “It’s the perfect time for Regent Seven Seas Cruises to order a new ship.” In a one-on-one interview, Del Rio spoke at length about the new ship. He called from Alaska where he’s sailing onboard Regatta for an Oceania Cruises 10th Anniversary sailing.
Travel advisors and industry leaders were brimming with excitement. “Yes, we definitely need some new product for the luxury cruiser,” emphasized Ruth Turpin, owner, Cruises Etc., a Virtuoso agency in Dallas, TX. “I think the biggest benefit is having another ‘true’ luxury ship…this gives us another 700 or so beds in the marketplace.”
Roger Block, president of Travel Leaders Franchise Group, said: “We believe this is a fantastic development that shows a firm commitment by Apollo that they’re seeing strong success with the Regent brand. By committing the financial resources to enhance the already exceptional customer experience, they’re also giving agents a phenomenal new product to sell.”
Recently inducted into CLIA’s Hall of Fame, industry veteran Michelle Fee, co-founder and CEO of Cruise Planners, said she’s always excited in hearing about a new ship. “It brings positive media exposure to our industry. It’s a great story and customers ‘love’ the new ships.”
From another perspective, “Prestige Cruise Holdings is a well-respected leader in the luxury market and has proven with the Oceania brand that they have a great deal of expertise in the design of new ships that the consumer will be attracted to,” said Dwain Wall, senior vice president and general manager, CruiseOne and Cruises Inc.
Wall views the order as “an excellent sign of the long-term commitment that Prestige has to the Regent brand.” He also said it shows the strength in the luxury cruise market.
Here’s Del Rio’s perspective on the new ship, the evolution of Regent, its onboard product and what’s ahead.
A Competitive Marketplace
Turpin considers Crystal Cruises and Silversea Cruises as the prime competitors for Regent Seven Seas in what she terms the “true luxury” category. Crystal Cruises (www.crystalcruises.com) sails the world with two luxury ships; Crystal Serenity, its newest, launched a decade ago. Silversea Cruises’ (www.silverseacruises.com) last major ship debut was Silver Spirit in 2009, although it’s adding a new small expedition ship, Silver Galapagos, this fall.
Seabourn Cruise Line has also added capacity over the past few years, and a new Viking Ocean Lines is expected to enter the upscale segment with a new small oceangoing vessel in 2016.
Among the main competitors cited by Turpin, Regent is the only line with a new ship order. Why? Del Rio said growth within the luxury segment is typically “more lumpy” than for the mass-market brands. “Luxury lines are more careful than large contemporary lines to add new capacity,” he said.
“It is a big step.” Del Rio said, citing a “different dynamic.” Regent’s brand is where it needs to be right now to take this step, Del Rio stressed. All-inclusive Regent has the highest luxury per diem in the industry.
When lines launch new ships and add berths, analysts often wonder if pricing will suffer. Seven Seas Explorer will represent a 40 percent increase in Regent’s capacity.
But Del Rio puts that in perspective: “Anytime a relatively small cruise line grows, on a percentage basis, [the capacity growth] is a huge number.”
What's more important to remember, he said, is that “our ships are sailing full right now.” His philosophy is that Regent's new ship reflects the consumer demand for the brand.
When Seabourn launched the third of three new ships in 2011, it subsequently sold its three older, smaller ships to Windstar Cruises. So, the natural question is whether adding a new ship might mean Regent would consider dropping its oldest, smallest ship from the fleet.
From Del Rio’s perspective, the whole point of the new ship order is to spread the line’s luxury footprint, to give it more capacity, not less. He said Seven Seas Navigator has the highest occupancy of any ship in the fleet. “Guests love her and she’s a money maker,” Del Rio said.
Bottom line: Agents shouldn’t expect the addition of a new ship to mean the exit of an older ship from the fleet.
About the New Ship
Seven Seas Explorer will have similar -- yet slightly larger -- capacity as compared with Regent’s Seven Seas Voyager and Seas Seas Mariner. Silversea and Seabourn operate smaller ships, while Crystal is known for its larger luxury vessels.
“The 700-guest range works well for us,” said Del Rio “Guests love that type of vessel. It works well with the itineraries, it works well with all-inclusive. We don’t want to change the winning formula.”
In its earlier press announcement Thursday, the line said the ship’s upscale – yet timely – design will feature “extreme use of exotic stones and polished woods, designer furniture, rich fabrics and sophisticated lighting combined with what promises to be a museum-quality, eclectic art collection will clearly position Seven Seas Explorer as the new standard in luxury cruising.”
In the past, Del Rio has taken a very hands-on approach to the design, architectural features and artwork of his firm’s vessels – most notably Oceania’s Marina and Riviera. Will he be as involved this time? Will he pick out the artwork?
“My guess is that the architects and designers will hate me by the time we get to the end of the process,” he quips. “I have to be very, very involved.”
Architectural and interior design firms Tillberg Design AB, RTKL Associates and ICrave are designing the vessel. Calling the Seven Seas Explorer, “the most luxurious cruise ship ever built,” Del Rio said. “It’s not an empty claim…Explorer’s aim is to obliterate [the current standard of] luxury” and elevate it.
Del Rio cited such elements as quality of towels, bedding, china and crystal, but also said the high quality will extend to guest-to-crew ratio and the design and space itself. He said the designers will assure that the materials, furniture, fabric and art will appeal to luxury cruisers and provide a very high-end quality experience.
In addition, “the cuisine will be over the top,” Del Rio added. Will the line have any celebrity chef affiliations? “I don’t see a need to add a celebrity chef,” he told us.
Del Rio acknowledged Regent's past relationship with Le Cordon Bleu and that Jacques Pepin is very involved at Oceania. But overall, he believes Regent’s cuisine is top notch, so he doesn't see any celebrity chef involvement for the new ship.
Seven Seas Explorer will have six open-seating gourmet restaurants; Seven Seas Voyager and Seven Seas Mariner have five, and Seven Seas Navigator has four.
What restaurants will guests enjoy? “You’ll see the same ones that are on Voyager and Mariner, such as Prime 7, Signatures, Compass Rose and so on, plus a third specialty Asian themed restaurant,” said Del Rio. The restaurant name is yet undetermined.
Seven Seas Explorer will have an all-suite, all-balcony concept, with 369 suites ranging 300 square feet to 1,500 square feet. “The suites will just be incredible,” Del Rio believes. Specific touch points will be revealed down the line, but the 54,000-ton ship will have only 369 suites, which he says is a gleaning about what space guests can expect..
“Even if you do make the spa larger and the gym larger and the restaurants larger [plus add a new Asian dining venue], you have a lot of room,” he said. “The suites will be very large and the bathrooms over the top.”
Another gleaning? Expect to see something unique with the balconies. “A lot of ships have lots of balconies, but in many cases, they are so small you can barely sit a chair upright,” he said, noting “these balconies are going to be special.”
Guests can also expect to see Regent’s signature nine-deck atrium, the two-story Explorer Theater, three boutiques and an expansive Canyon Ranch SpaClub, which will be larger than on other Regent ships.
A Global Fleet
Ordering a new ship is “a very smart move,” said Turpin, noting it will allow them to have more destinations to offer. “We have a number of luxury clients who are looking for new destinations. Also hopefully, it will allow them to do a real Full World cruise again. I know the demand is there.”
Clearly, 2016 is still too far out for the line to detail the new ship’s itineraries. “Typically, when new ships are introduced, you introduce them in the best-selling itineraries,” said Del Rio. “We did that with Oceania with Marina and Riviera and we’ll do the same with Seven Seas Explorer.
But he left the door open about what the bigger fleet might mean for the line’s ability to offer a World Cruise, noting that “we won’t discount that,” particularly with a smaller ship.
Just as Insignia will operate Oceania’s first full World Cruise, a 180-day voyage in 2015, experts say Seven Seas Navigator might be a good fit for a full World Cruise at some point. “Well, you never know,” Del Rio said.
We asked Del Rio, a proud Cuban-American, about the potential for Cuba port calls. He’s very enthusiastic about the potential but said it's really in control of the U.S. government, and given the current embargo and politics, "we’ll have to just wait and see."
But he admitted he’d love to plan a full circumnavigation of the island, and says: “We along with every cruise line would love to be able to travel to Cuba, something no one have been able to do in the past 53 years.”
Wherever it sails, though, the new luxury ship will be powered by diesel-electric engines with a service speed of 20 knots. Seven Seas Explorer will be a “green ship” employing the most advanced environmental systems and state-of-the-art technology.
The Luxury Marketplace
Regent had a record year last year, Del Rio said, noting it was the third year in a row, and the luxury brand expects another record performance this year with strong per diems.
“The all-inclusive message really resonates in the marketplace,” said Del Rio, noting it’s not just with luxury clients but also with premium cruisers wanting to move up and know what they’ll spend on their luxury cruise.
“When the economy was suffering, they went to their ‘all-inclusive’ model and it changed the luxury space,” acknowledged Fee. Regent’s fares include all-suite accommodations, round-trip air, highly personalized service, acclaimed cuisine, fine wines and spirits, sightseeing excursions in every port, gratuities and a pre-cruise luxury hotel package for those staying in a concierge or above suite.
“So called ‘nickeled and dimed’ is alive and well at other lines, and getting worse,” Del Rio says, noting that Regent’s brand proposition is “something unique in the marketplace and it’s the reason why the fleet is full.” Del Rio’s view is that others have onerously mimicked it, but not copied it.
As a brand, Regent attracts 85 percent North Americans; 80 percent are from the U.S., 5 percent from Canada, and the rest from the United Kingdom, Australia and New Zealand primarily. By the time the new ship launches, Del Rio projects those totals will be approximately 75 percent from the U.S., 5 percent from Canada and about 20 percent from those other European speaking countries.
Because Regent commands the highest per diems in the industry, it's not surprising that the brand attracts what Del Rio calls “an affluent group.” Top clients to target demographically are those in their upper 50s and lower 60s in age.
From a psychographic standpoint, Del Rio said guests are often illustrious people in their own fields, such as top notch economists, major Fortune 500 leaders and others who typically are what he terms “humble…don’t have to show off their wealth…and are low key in nature.”
It’s too early said Del Rio to describe how the brand will introduce the new ship to agents. “But we did want to go out and name her early, so people can talk about who she’s going to be,” he said. While it’s one less “reveal” there will be others he says, noting that the marketing folks are in the midst of the roll-out planning.
Many agents have known and worked with Mark Conroy, the line’s former president, and wonder if he’s involved in the ship planning. Yes, says Del Rio. “Mark has already had a role in development of the plans,” Del Rio said, noting that Conroy, now a consultant to Prestige Cruise Holdings, has very much put his mark on what the new ship will become.
“And as we get closer to developing more and more of the details, he’ll be asked his opinion,” Del Rio said, noting that Conroy’s feelings and recommendations will be included as appropriate.
Overall, “we’re very excited as new ships don’t come along often,” Del Rio emphasized. “The reason we’re able to do it is travel agent support.” He cited the line's strong relationships with Virtuoso, Signature and others.
From one trade leader's perspective, “the culture of paying close attention to details and to building strong relationships with the customers has created what I would say is one of the most loyal customer base in the industry,” said Wall. “This loyalty will assure success for this new ship and Regent.”
Stay tuned for another robust story today providing perspective from industry leaders including John Lovell, president, Travel Leaders Leisure Group and Vacation.com; Alex Sharpe, chief operating officer, Signature Travel Network; and others.