Cruise Execs Discuss Cuba, Cruise Rookies and Capacity at CLIA's cruise3sixty

Cruise Lines International Association (CLIA) leaders as well as cruise executives speaking on a "View from the Bridge" panel commemorate CLIA's 40th anniversary at cruise3sixty in Port Everglades, FL. Left to Right: Lorri Christou, CLIA; Charles Sylvia, CLIA; Adam Goldstein, Royal Caribbean Cruises Ltd.; Lisa-Lutoff Perlo, Celebrity Cruises; Andy Stuart, Norwegian Cruise Line; Jan Swartz, Princess Cruises; Christine Duffy, Carnival Cruise Lines; and Cindy D'Aoust, CLIA.  // Photo provided by CLIA

Cuba, cruise rookies and capacity were the hot topics discussed in "View from the Bridge," one of cruise3sixty's leadership discussions last week at Port Everglades, FL. Approximately 1,300 travel agents attended the show sponsored by Cruise Lines International Association (CLIA), celebrating its 40th anniversary this year. The conference ended Sunday.

"View from the Bridge" executive panelists included: Christine Duffy, president and CEO, Carnival Cruise Lines; Lisa Lutoff-Perlo, president and CEO, Celebrity Cruises; Jan Swartz, president, Princess Cruises; and Andy Stuart, president and CEO, Norwegian Cruise Line. The discussion was moderated by Carolyn Spencer Brown, editor-in-chief, CruiseCritic.com

Cuba Is Calling 

When Spencer Brown asked the agent audience of 1,300 to raise their hands if any customers had already inquired about a potential Cuba cruise, hundreds of agents' hands shot up. A sense of "wow" filled the room, as the response showed Cuba is a hot destination on the minds of many potential travelers.  

From Carnival Cruise Lines’ perspective, Duffy said: “We all believe there’s a lot of pent-up demand because Americans have not been able to travel to Cuba, although a lot of other countries have had tourism and people traveling to Cuba.” Previously CLIA’s president and CEO, she stressed that the discussion about Cuba has been ongoing but “I think we all agree it does seem much more serious and further along than it has ever been.”

She added that while everyone is thinking about how to make Cuba a part of itineraries, “at the end of the day, we don’t get to decide [whether it’s opened up], we get to be as prepared as we can. Duffy said cruise lines are also thinking about infrastructure and how to prepare for ship and guest arrivals, “but we think it’s a positive opportunity.”

Lutoff-Perlo, who did a one-on-one interview with Travel Agent earlier this year,  told the audience Celebrity is also looking at Cuba, and while her line would like to go there, Celebrity may see the opportunity a bit differently than other lines, simply because its cruises are longer: “We’re not in the short cruise market, so I would see Cuba as an added feature on a long Caribbean itinerary.”

Spencer Brown asked the group about Cuba's draw for cruisers: "What’s there besides the old stuff?" Lutoff-Perlo stressed that it’s only Americans who aren’t going to Cuba right now, and that many international hotel companies have built beautiful properties there.

Citing sun and fun on the beaches and the old Spanish Colonial architecture, Norwegian Cruise Line's Stuart said: “It's unbelievably exciting for the industry…It’s going to be a huge engine for growth, if and when there is an opportunity for us to go.”

Adam Goldstein, CLIA's chairman, is shown with cruise executives who participated in a "View from the Bridge" discussion at the cruise3sixty conference. Left to right, Goldstein; Lisa Lutoff-Perlo from Celebrity Cruises, Jan Swartz from Princess Cruises, Christine Duffy from Carnival Cruise Lines and Andy Stuart from Norwegian Cruise Line. // Photo provided by CLIA

North American Capacity

Speaking about the rush of cruise lines eager to source customers in China and elsewhere across the globe, Spencer Brown asked the executives, “What’s going on in North America?”

Princess Cruises' Swartz stressed that North America is the largest cruise market in the world by miles. “This is our core market,” she emphasized, noting that while Princess is a key player in Asia, it also has focused heavily on innovating to continue to build North American cruising. She cited recent partnerships with Norman Love, the Discovery Network and Stephen Schwartz.

Princess also serves Americans and Canadians in Asia, she said: “We have cruises in Japan that are sold to North Americans that allow your clients to see this beautiful island nation at exactly the right time to see the special Japanese festivals, in a way that’s comfortable and familiar to them.”

She also believes there's an enormous profit opportunity for North American travel professionals to introduce their most experienced cruisers to itineraries Princess sails from Japan, Singapore and Australia. “There’s such a wealth of product for you to see at high prices,” stressed Swartz.

Stuart cited Asia as a big opportunity for the industry, noting that added tonnage coming through 2020 will help lines spread out across the globe. He said it's increasingly important to continue to find new ports of call.

But Stuart also praised the existing strength of the North American market. “There are plenty of ships…there’s no shortage,” he stressed, mentioning that Norwegian Escape will begin sailing year-round from Miami this fall. “I think there’s plenty of capacity to keep this whole room busy.”

He also noted that all the marketing that comes across the industry with the new ships is a boon for the industry’s growth potential: “Nobody should feel worried that there’s not going to be enough [North American] capacity for travel partners. There’s absolutely plenty. So keep selling please.”

Citing a CLIA statistic, Duffy said cruising penetration of the North American market is still below 4 percent. With all of the new ships and the marketing for those ships, plus the fact that Carnival has 24 ships, two more on the way, and most of its capacity in the U.S., Duffy said: “We feel we have a great opportunity to attract those first timers, those cruise rookies that may not be ready to take a trip to Japan.”

The important focus, according to Duffy, is to place the cruiser on the right brand, as the brands have all differentiated themselves both in customers they attract and the experiences they create onboard.

Stuart told the audience that Norwegian Cruise Line will introduce a 2016 all-inclusive product on Norwegian Sky’s three- and four-day sailings from Miami. “We think this is huge,” he said, noting it was “a very powerful differentiation.” Travel agents will earn more on the basic booking, given that a premium beverage package is now rolled into the 2016 price. 

Duffy stressed that cruise lines aren’t in competition so much with each other, but rather with other vacation choices including tours and land-based resorts. As for all-inclusive products? They appeal to some customers, but not all, she said: “It’s less about inclusive and more about the kind of choices people have.”

“Consumers are so different,” noted Lutoff-Perlo, so “customization is probably for me one the thing that resonates more and more.” She also said she's sad to see the percentage of first time cruisers decline, noting that “the experiences we provide are unbelievable, the value you get is phenomenal.”

So Celebrity will keep working to find what resonates best with potential first timers, said Lutoff-Perlo. She urged the travel advisors to pitch Alaska to first time cruisers. It hasn't typically been the first option for rookies; that's typically been via the Caribbean.

Why Alaska? It's accessible in many places only by sea, so Lutoff-Perlo says consumers who have never thought about a cruise might take one, as this is the best way to see the state's natural beauty. 

Finally, “we don’t focus enough on groups,” said Duffy. For Millennials or multi-generational groups, she believes it's a great way to get them traveling on a cruise. Once they sail, they get what a cruise is really about and will book again.

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