Currently, travel agents play a key role as the prime distribution arm of the cruise industry – marketing and selling the majority of cruises. But now more clients across the globe are asking what the industry is doing on the environmental and sustainability side and that is increasingly likely to influence future sales discussions. Agents need to get ready.
That was the prime focus of a keynote address delivered by Adam Goldstein, vice chairman of Royal Caribbean Cruises Ltd. and global chairman of Cruise Lines International Association (CLIA), on Wednesday at CLIA’s annual Cruise360 conference in Port Everglades, FL.
Speaking at the Broward County Convention Center, Goldstein spent the entirely of his talk focusing on the changing landscape of consumer sensitivity to sustainability and environmental issues. But what does it mean for travel agents?
“It becomes part of your world slowly but surely,” Goldstein said. “Just as you train and receive certifications and learn about other crucial aspects of the business…so also will you come to this.”
The Massive Opportunity
Before the end of the next decade, “we’ll be somewhere between 40 [million] and maybe 50 million cruisers,” said Goldstein. This year, some 30 million people are expected to cruise.
Calling that a massive opportunity, Goldstein said the first challenge is “creating, enabling and serving that demand – helping us finding the extra 10 or 20 million cruisers a year that we will be needing inside of a decade. It’s a profound challenge.”
He said the world is changing “for lots of reasons that you all know that are part of this conference -- digital, social, data analytics, artificial intelligence, and not the least of which is just the dizzying array of choices, both on land and on the water, where people can go for their vacations.”
“But there’s another kind of challenge,” he said. “It’s the challenge of preventing this opportunity from being inhibited – making sure that we have the freedom to operate all the ships that are coming and all the ships that we have.”
It’s the challenge of being “responsible stewards of sustainable activity, so that we maintain the wonderful privilege that we have of navigating the oceans of the world and bringing you and your customers to more than 1,000 destinations,” Goldstein stressed.
Saying he hoped to put sustainability and environmental stewardship “into a certain framework that will motivate you to want to find out more,” Goldstein stressed.
The focus on sustainability globally is “one of the ways the world has been changing,” he said. “It certainly encompasses the water under our ships, the air over them, the destinations that they visit and the colleagues that work with all of us.”
Goldstein said that travel and tourism is growing far faster than the world’s economy is growing. And that hunger to see the world, as more people become middle class and upper middle class, appears “inexhaustible.”
That’s “absolutely wonderful for those of us who are in the business, and a tremendous source of concern around the world for how that business, that interest and that hunger will be handled,” he said.
While some agents are beginning to see that expressed by concerns of Millennials and Generation Z in North America, Goldstein stressed that the industry sees it in Europe at every age level: “Europe at this point is sort of Ground Zero to environmental sensitivity … to all kinds of tourism and other things besides tourism.”
Responsibility is key, he said, and that means responsibility to the oceans, the communities that cruise ships visit and the people who work for and with the industry. Overseeing and judging the industry is the International Maritime Organization (IMO), the global regulator of shipping and maritime operations, including cruising; they set safety standards and also environmental standards.
The IMO, for example, has set new global regulations on sulfur emissions by ships, which begin January 1, 2020. Plus, the IMO has a new 2030 standard for greenhouse gas emissions. But environmental and sustainability issues go far beyond the IMO’s regulatory approach.
In addition, “the European Union, the United States, China and dozens of other governments at national, regional and local levels are keenly interested in whether or not we are responsible stewards,” Goldstein said. They’re asking, “how are we taking care of the world around us.”
He also cited strong interest by NGOs, or non-government organizations, as well as the court of public opinion, “which is ultimately how we are all judged.” Public opinion also influences the IMO, governments and NGOs.
For agents, the bottom line is how all these views of the cruise industry’s responsibility on sustainability and environmental issues can support the growth of the cruise industry over time.
Goldstein also said cruise ships are extremely visible, generally are getting larger and there are thousands of customers coming off them in different destinations every day. “So this is not a sector where we can hide from public view,” he said. “We simply have to be exemplary in our actions and in our behaviors.”
Leadership, Stewardship, Partnership
He talked about the industry’s commitment to meet or exceed those 2030 IMO requirements as one way to show consumers that the industry is responsible. “Since we announced that in December, it has been exceptionally well received and continues to be,” said Goldstein.
The industry has also expressed support for the IMO’s century-long vision to have a carbon—free maritime environment. However, Goldstein called it an audacious goal, as “none of us have clue today about how we would realize a carbon-free maritime environment by 2099.”
That said, “we all need to get on with it in terms of research and development, but we have expressed our support for that idea,” he said.
Goldstein also talked about the cruise industry ships coming into service that will be powered by LNG, or liquid natural gas, as opposed to the traditional marine fuel oils: “That’s a tremendous step forward for our industry, a very exciting development.”
Referring to Italian concerns about too much tourism in Venice, he talked about a number of large cruise companies that are now working with all levels of the Italian government, NGOs and the port authority to try to find a long-term sustainable situation that allows cruise ships to continue to go to Venice and yet protects the “unbelievable heritage of that city, of that place.”
Goldstein described “stewardship” as encompassing a range of activities, such as new advanced wastewater treatment systems, exhaust gas emissions systems/scrubbers, hull coating, hull shapes, air lubrication systems that eject bubbles under a ship’s hull to cut down on fuel consumption, LED lighting, and single-use plastic bans, as well as many more items.
“Now I don’t expect any of you to get your Ph.D in all of this,” Goldstein told the agent audience, but he said, “I believe it will become increasingly instructive in dialogue with at least some guests – some increasing number of guests that you will begin to get questions from about these types of stewardship elements.”
Because the cruise industry trusts agents to represent cruise line products in every other way, it wants to also trust advisors to be able to talk at a certain level about sustainability, too. He urged the travel advisors to become familiar with the topic and ask specific questions of suppliers, just as they do now on other issues.
High-Level Global Partnerships
Next week at Seatrade, the annual maritime conference in Miami Beach, “our featured speaker will be the secretary general of the United Nations’ World Tourism Organization,” Goldstein said. “We have never had anybody like that attend a Seatrade conference before. But that’s the level that we’re working with to make sure everybody is aligned and on the same team.”
The World Travel & Tourism Council annual meeting also is currently under way in Seville, Spain, with heavy CEO-level cruise industry representation. And cruise companies have partnerships with the Nature Conservancy, the World Wildlife Fund, the Global Sustainable Tourism Council, and so on.
“These types of partnerships will multiply,” he said. He also said partnerships can extend to cities like Dubrovnik, where the cruise lines are working with the city and mayor to make the most optimized use of the Old City, or to destinations (such as the Caribbean or the Philippines) where the industry has helped in post-storm/disaster recovery efforts.
Using a Sports Analogy
Perhaps most telling? He told the agents that geography matters, and “you have not really felt what’s coming our way – coming to the United States,” a reference to the growing consumer concerns globally about what companies are doing on the sustainability/environmental side.
Using sports to demonstrate his point, Goldstein described today’s existing U.S. cruisers as “a home game,” as those folks typically will root for the cruise industry as a home team. “We’re playing on our home field,” he said. “There’s a predisposition to have faith in us. There’s an optimism about our behaviors. There’s a sense that we have accomplished a lot and that we often try to be above and beyond compliance.”
But he said fans also desire to know more, to have more data and better information. “And ultimately, no matter how much of a fan you are, you want to know that the home team is going to put a winning team on the field – that we are in fact going to demonstrate consistently over time, in sustainability, the right behaviors.”
He said the industry is determined to keep that high rating from existing consumers. But for non-cruisers in the U.S., he’d describe the scenario as “playing on a neutral field.” Non-cruisers are more likely to sit back and wait to see how it unfolds before choosing sides, and it could go either way.
“We want to win those people over, not only to have a cruise experience, of course, but also to demonstrate the commitment we make to sustainability on an everyday basis,” Goldstein said.
But, “when it comes to Europe, we’re playing on somebody else’s field,” he stressed, saying that for the cruise industry it was like playing an away game.
All European demographic groups are deeply concerned about sustainability and environmental protection: “There is just extraordinary sensitivity throughout the continent of Europe at how all industries, all businesses and even government are behaving in terms of sustainability.”
Most telling? “It is the first question that comes up anywhere I go there,” Goldstein told the agents. “I don’t see that changing other than to get even more intense.”
While he said he doesn’t know that the U.S. will ever be like that, but “I am very confident to say it will become more like that and that’s something that we need to prepare for.”
He said the industry needs to tell the story of leadership, stewardship and partnership “more often, more articulately, more powerfully and to more audiences.” Agents can help in that regard, and Goldstein expressed “enormous respect” for the work advisors do, saying the growth already achieved would not have been possible without them.
But, when it comes to the cruise industry’s sustainability and environmental responsibility, “It is going to become more relevant to all of you and your colleagues on a day-to-day basis as we go forward,” Goldstein told the agents.
But he also added that by attending Cruise360, “you’re ahead of the game.”