Will discounts lead to dividends for cruise lines?

A panel of cruise experts speaking at the recent World Travel Market exhibition and conference in London predicted that today’s first time cruise passenger, attracted by hefty discounts, will become cruise regulars in the future.  The panel also agreed that the need to fill new ships by offering price-driven deals will reap dividends for the cruise industry when the recession ends.

Cruising has bucked the trend in the UK during the recession, with the number of UK cruise passengers set to reach 1.55m this year.  The panel argued that the extra 47,000 beds coming onto the cruise market in 2010 and 2011 will not be a problem. Yachts of Seabourn director, Europe, Middle East and Africa, Andrew Magowan said the cruise line would raise its 2010 capacity by 60%, but said it was not a concern, despite a need for discounting.

He said: ‘There will be some great opportunities for people to cruise on Seabourn. We are prepared to invest in the product because 50% of our clients repeat within 18 months.  I don’t buy the argument that if you discount in a difficult market you will never get it back.’

NCL’s UK and Ireland general manager Stephen Park said consumers ‘had never had it so good,’ and more people had been brought into the market. ‘At some stage the recession will finish and we will have more people coming into cruising,’ he said.

MSC Cruises’ UK and Ireland chairman Peter Pate said cheap headline prices where not necessarily what the consumer paid, adding: ‘Most clients’ trade up. Our per diem rates in the UK are up.’

RCCL associate vice president and general manager UK and Ireland, Jo Rzymowska, praised trade support for cruising and said: ‘We don’t have a capacity problem. Seven million people go to Spain and only 3% of the overseas holiday market is cruising.  The question people will ask is ‘do I go to Florida, do I climb the Himalayas, or do I go on a cruise?’  

Sphere: Related Content