Cruise Trends Part 2: Europe Still A Force, Pregnant Pause For Caribbean
Europe remains a sizeable force in the cruise biz, despite fears sparked by terror incidents and the fact that cruise lines have moved some ships to other regions for next summer. Meanwhile, there’s a Caribbean question mark in the form of the Zika virus.
As examples, despite moving Oosterdam to Alaska for next year, Holland America still has plenty of capacity in Europe, as does Princess. Celebrity moved 1 ship from Europe to the Caribbean for 2017, but they also plan to keep extensive capacity in Europe.
The trend is less exposure in the Med, especially the Eastern Med. What growth there is has largely been confined to Northern Europe.
For all markets, but for Europe 2017 in particular, the focus is on understanding marketplace promos. Are they as rich as they once were for Alaska? Are they getting richer for Europe? Do free drinks make a difference for Europe? And the value of onboard credits - are they changing?
Take Celebrity. Out in the field, they’re heavily promoting discounts for Europe. Those that book ocean view or higher staterooms until October 2016 will save 50% off the 2nd guest’s fare, and both can enjoy complimentary Classic beverage packages along with other perks.
Overall, agents report that 2017 Europe sales are soft, but that said, there are quite a few bookings for close-in Europe now. Perhaps part of paying attention to what matters is paying attention to the news. The situation in Europe has been pretty quiet lately.
That could also be why Cruise Week is hearing reports of strong group business coming in for Europe 2017, particularly for northern Europe.
In terms of cruising’s biggest market, Cruise Week continues to hear reports of a pregnant pause in Caribbean cruise bookings related to concerns about Zika. That’s troubling from a business perspective because frankly, as one agent told us, “Some people even go on a cruise to get pregnant.”
A recent report by Morgan Stanley summing up agent pricing reports concluded, “Our monthly agent survey suggests cruise demand weakened in August, with prices also softening. With the industry order book at a record high, Europe/China likely to stay weak, and Caribbean risks rising, we see yields continuing to slow.”
Still, Cruise Week’s own feedback from the field indicates that Zika’s bite doesn’t seem to be taking hold, as other factors outweigh the concern. People have money to spend and want to vacation. The issue is now linked with Florida in the news but still not to cruise ships per se.
“It’s not that people don’t believe it’s a problem, and they certainly are paying attention to Zika; it’s a threat, especially if you’re pregnant,” says one agent. “But it’s not spreading beyond that segment.”
However, this week some low-priced promos suggest softness in the Caribbean. A 4 day Bahamas cruise on Norwegian Sky sailing out of Miami, was priced from $30 per day (with free open bar). Similarly, 7 day Eastern Caribbean sailings on Norwegian Escape and western Caribbean on Norwegian Getaway from Miami were priced from $40 per day.