Travel Leaders Execs Answer: “How's Your Cruise Business?”

CruiseWeek

Travel Leaders Group CEO Ninan Chacko

As the first half of 2018 winds down, CruiseWeek asked executives at the recent Travel Leaders Network conference, "How is your cruise business going this year?" Interestingly, their answers jibed with the responses of owner/managers and front-line agents at the same event.

"River cruising has been doing better than ocean cruising, actually off to a terrific start this year, just flying," said Travel Leaders Group CEO Ninan Chacko. "And the broad industry, I don't just mean cruise, is in great shape.

"Cruise actually is hitting our expectations, I would say, maybe even slightly exceeding it," continued Chacko. "But I think undoubtedly for me there is probably some impact with respect to Caribbean and everything that happened last year in terms of, obviously, that volume.

"The rebooking that has taken place has shifted some of that demand out, but I would say we’re off to a really, really good start."

In other words, what would have been 2018 Caribbean bookings have been delayed into 2019, as some customers wait for all of the islands to fully recover.

But of course everything is relative. Comparing ocean cruising to river Chacko said: "So [ocean cruising] is off to a great start, it's just when you look at it next to river cruising, you're like, 'Wow, that's a really attractive number, why isn't ocean looking like that?' But it's just that river cruise is off to a phenomenal start."

Steven McGillivray, chief marketing officer of Travel Leaders Group, broke it down a bit by segment: "On the cruise side, premium, luxury, and river are all strong, mass market is where some of the challenges are."

Indeed, many of the agents in attendance identified upper-end sales as moving the best, and pointed to the increased promotional environment on the mass-market side.

As for new ships, several referenced Celebrity Edge as generating the biggest buzz. CruiseWeek asked John Lovell, president of Travel Leaders Network and Leisure Group, about that perception and he confirmed, "Our Edge bookings are off the chart."

Many leaders also singled out improvements with premium brand Holland America Line, both in terms of product and marketing. For instance, during the week of the conference, HAL announced that not only will Oprah Winfrey be godmother for the Nieuw Statendam (date not specified), but she will also sail on the ship in January.

In the past, Holland America usually had Dutch royal family members as godmothers, which is true to its heritage but not a big media draw in North America. There have been a few exceptions--including the Olsen Twins for the Zaandam back in 2000 -- but nothing like Oprah. Winfrey's very presence symbolizes how the brand is evolving and putting its partnerships to good business use.

All in all, conference attendees identified many bright spots, both in terms of brands and in general, but suggested Caribbean mass market is not where it could be.

Clearly, Wall Street has noticed: the stocks of publicly traded cruise companies Carnival Corp. and Royal Caribbean, which do a lot of Caribbean, traded in the red through the entire first half of the year. However, from the retail side, while reports are not quite as rosy as cruise exec reports, they are generally upbeat.

Emerson Hankamer, Vacations to Go, summed it up: "We're Main Street, not Wall Street."




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