The future of the luxury cruise market was in the spotlight during a TTG Roundtable discussion held with Clia UK & Ireland.
The problem of overtourism in key destinations can be a “big challenge” for the luxury cruise market, particularly with itineraries that are planned two or three years before the cruises take place.
During a discussion on this increasingly important topic, Azamara’s Richard Twynam said it was difficult to predict the change in the popularity of certain destinations years in advance and what impact this might have.
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The future of the luxury cruise market was in the spotlight during a TTG Roundtable discussion held with Clia UK & Ireland.
The problem of overtourism in key destinations can be a “big challenge” for the luxury cruise market, particularly with itineraries that are planned two or three years before the cruises take place.
During a discussion on this increasingly important topic, Azamara’s Richard Twynam said it was difficult to predict the change in the popularity of certain destinations years in advance and what impact this might have.
“It’s very hard because we have already deployed [our ships] and you cannot change the direction of the ships,” he said. “Dubrovnik was very popular and then Game of Thrones made it even bigger. We don’t know what the next big TV show is going to be and which destinations it might affect.”
Twynam also admitted that “geopolitical events” could also put pressure on certain destinations, as other ports of call are forced to become off limits. “With the awful events in the Caribbean we have had to move things around, so we have to remain relatively nimble,” he added.
Luxury cruise lines at least have the advantage of being able to change their itineraries if necessary, said Seabourn’s Lynn Narraway. “We are lucky we can move the ships, and we are always looking for more destinations and ports,” she said.
The panel agreed that the smaller size of luxury cruise ships, which generally only have a maximum capacity of up to 600 passengers, enable them to visit ports and destinations that larger mainstream ships cannot call at.
One destination where luxury cruise lines work together closely to avoid overtourism is Antarctica where they coordinate itineraries to protect the environment of the polar region.
Ponant’s Stephen Winter said: “We negotiate for slots in Antarctica and all the cruise lines work together with the ships talking to each other.
“It’s about protecting the environment – we have ships that run on LNG [Liquefied natural gas] and do not discharge waste. People like this – they want to know that when they leave Antarctica it’s being left in the same condition as it was before.”
Agent Mark Beattie, from Off Broadway Travel, added that clients did not normally specifically ask about issues such as a cruise lines’ environmental policies but he said it was a good “talking point”.
“It’s not going to sway them either way – unless they’re eco-conscious, they are not going to ask. But if you can say ‘we’re leaving the destination exactly the same as when you arrived’, then that’s another tick for the cruise line they are going on,” he said.
The issue of overtourism was part of a wider concern, said Clia’s Andy Harmer, who added: “It’s a travel industry problem, not so much a cruise issue. All lines look at power and sustainability – the cruise industry has spent $1 billion on new technology to reduce our footprint and impact.”
Cruise lines also have the advantage of being able to choose their dates of call to ensure the port is not too busy.
Twynam added: “We’re going to Alaska for the first time in 2019, and the cruise starts in Vancouver where we’ve chosen a day when no other cruise ships will be calling.”
All of the panellists agreed that sales in the UK for their cruise lines have been “robust” this year and that the many new ships on order in the next few years showed a “confidence” in the luxury end of the market.
There was also agreement that the luxury cruise market needed to attract new customers from outside the sector, including the millennial generation and luxury travellers who currently only go on land-based holidays and need to be persuaded of the value and advantages of taking a cruise.
Seabourn’s Lynn Narraway said: “Rather than asking cruise customers to upsell, look at the luxury market as a whole, that’s where the growth is. We need to explain and educate the luxury traveller about what we offer.
“We have to keep evolving and enhancing the brand, product and service. You cannot stay still.
We have to do that more in the luxury sector than other parts of the industry.”
Off Broadway Travel’s Mark Beattie added: “More of our customers are experiential customers. Luxury is ambiguous – what’s luxury for somebody is not luxury for other people.
“Ultimately we have to look at the millennials and younger generations, who are going to be our bread and butter for the next 20 to 40 years, who are cash rich but time poor. They want to be a traveller rather than a tourist – they are a more experiential type of traveller. It’s as if they want a gap-year kind of trip but in two weeks, and for it to be a luxury experience.”
The cruise lines admitted that they only really catered for families during peak travel periods, such as school holidays, when they put on some activities for children. But they did identify a growing trend for more multi-generational families travelling together on cruises.
Most luxury ships do not have dedicated facilities for children, although Silversea has introduced a dedicated kids area on its new ship Silver Muse, including Playstations. Silversea’s Connie Georgiou admitted, however, that these were “hidden away” on the ship.
There was also a unanimous welcome for the move by luxury hotel company Ritz-Carlton to launch its first cruise ships from 2019, which was declared to be “good news” for the overall market.
Georgiou said: “Ritz-Carlton’s hotel experience is amazing – it will keep us all on our toes and make sure we don’t rest on our laurels.”
But will Ritz-Carlton’s decision encourage other luxury hotel brands to launch their own cruise lines as well? Ponant’s Stephen Winter was not convinced: “I can’t see many others doing it – maybe Relais & Chateaux – but that’s about it.”
As for another big issue, Brexit, the luxury cruise specialists agreed that it was not having any impact so far on their UK sales but warned that it was too early to fully note the repercussions of last year’s referendum.
Harmer said: “It’s too early to tell. But all the new ships show a tremendous confidence in the sector and we believe the future is bright.”
One area where there is already an impact from Brexit is around currency, following the pound’s slump against both the dollar and euro.
France-based Ponant is considering switching its prices from euros to pounds as a result of the currency changes. Stephen Winter added: “We give them [guests] euro rates but we might transfer them into pounds – maybe we will have fixed rates in pounds because of Brexit. It is affecting the buying power of the pound.”
Georgiou agreed the UK market wanted to have pricing in sterling.
Twynam, meanwhile, admitted that there were signs of “some nervousness” in Ireland over the economy because of the prospect of having a “hard border” due to Brexit. “We may see that impact on confidence in the next year or two,” he said.
However, even the cloud of Brexit could not dampen the panel’s confidence in the future of the luxury cruise market and how agents will have a key part to play in the sector’s ongoing success.
“We have the challenge of explaining the experience to agents so they can explain it to their customers,” said Clia’s Harmer.
“Of course, the ships are still really important and the product is amazing, but they are just part of the experience – not the whole experience.”
"Ritz-Carlton’s hotel experience is amazing – it will keep us all on our toes and make sure we don’t rest on our laurels"
Connie Georgiou, Silversea, on the hotel group's move into cruise
Lynn Narraway, UK & Ireland managing director, Seabourn and Holland America Line
Richard Twynam, managing director UK & Ireland, Azamara Club Cruises
Stephen Winter, director of international sales, Ponant
Connie Georgiou, sales director – UK & Ireland, Silversea
Mark Beattie, personal travel specialist, Off Broadway Travel
Andy Harmer, senior vice president membership and director, Clia UK & Ireland
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