Millennials, or young adults, are the new market of choice for cruise lines, they offer the perfect escape for young holidaymakers, so why is it proving so hard for cruise lines to capture the interest of this age group?
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For those who haven’t actually taken a cruise before, but have looked into the industry from the outside, the idea of a cruise vacation is often distorted by preconceived ideas of what a cruise really entails. For cruise lines, this is the hardest challenge to overcome, but they’re investing huge amounts of money in doing so, because the age group that most dislikes the idea of a cruise holiday is the age group that the cruise lines most want to win over.
The average age of the cruise passenger has fallen significantly in the past couple of decades as the cruise industry has become a more mainstream sector of the broader travel market, but it still hovers around 50-years-old, according to research by the Cruise Lines International Association for 2013. This is despite the rampant popularity of cruise lines like Carnival Cruises and Disney Cruises with families and young children.
For the rest, from Princess Cruises to Costa Cruises, MSC and Royal Caribbean, attracting younger passengers on-board (those in their early 20s to mid-30s, known as the ‘Millennial’ generation) is a major challenge. And if they aren’t a couple with children, it’s near-to-impossible. So large amounts of money are required in terms of investment in diversifying the cruise brand, and making young travellers realise that cruising is in fact a perfect fit for their needs.
The theatre aboard Celebrity Constellation (right) and Norwegian Cruise Line’s teaming up with Cirque du Soleil to provide a dinner theatrical dinner experience are just some of the ways cruise lines are boosting on-board entertainment
“Millennials love to travel; they love to show off their travel on social media,” says Debbie Fiorino, senior vice president of Fort Lauderdale-based travel agent networks CruiseOne and Cruises Inc. Jeff Fromm, president of millennial-focused consultancy FutureCast and author of the book Marketing to Millennials, agrees, telling the Miami Herald that millennials have a greater desire than any other age group to travel to diverse and varied destinations and want to be able to share their adventures quickly on social media. “Affordable adventures are a huge theme for millennials,” Jeff Fromm adds.
Young adults are, generally-speaking, according to market research, tech-savvy, global in world view, careful about spending and hungry for new experiences, all of which is available aboard modern cruise ships. Royal Caribbean recently upgraded the wireless internet connectivity aboard their largest-in-the-world cruise ships Oasis of the Seas and Allure of the Seas, making it even better than that found on land, but in actuality all major cruise lines offer wireless internet aboard their ships, aboard many cruise lines its even complimentary.
In addition, the inclusive nature of a cruise holiday should make it easy for cruise lines to target this age group, which accounts for around USD $1.4-trillion in global spending. Cruise lines promote value-for-money, the ability to visit multiple destinations in a short period of time and diversity in options that can let young workers without much holiday time escape for a quick weekend or long-weekend trip.
Royal Caribbean’s Oasis Class ships are the only cruise ships in the world so large that they offer views into the ship itself, for example the Central Park balcony cabins (above) – this is just one of the ways RCL is trying to set itself apart
The younger age of the Millennial generation is also what makes these potential passengers particularly attractive to cruise lines. “We have a great opportunity to get them as first-time cruisers, and we believe they will become lifetime cruisers,” says Fiorino. They represent a long-term market for cruise lines, which typically have a guest return rate in excess of 50 to 60%.
It is a major challenge though. Cruise Arabia & Africa has encountered countless ‘cruise denialists’ in their 20s and 30s, in both the Middle East and South African cruise markets, but also in the more developed European and North American markets. Young adults associate cruises with an older generation, thinking of cruise ships as a grand-parents escape, with set dinner times and limited entertainment and activities on-board.
According to the Cruise Lines International Association, only 7% of the 27-million or so cruise passengers per year are between 25 and 29-years-old. Young people not only see cruises as being for old people, but they also think of cruise ships as floating prisons while at sea, not realising that the ship, a lot of the time, is the destination in itself, and on most Caribbean, Indian Ocean, Mediterranean and Middle East cruises, the ship stops at a different port almost ever day. By investing in larger ships that can accommodate a wider array of entertainment options, cruise lines are actively trying to increase their Millennial market share. They now offer a greater array of everything on-board, from cocktails and beers, to online apps, celebrity chefs and Broadway shows.
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The waterpark aboard Disney Cruise Line (top) features the longest water slide at sea, while Carnival Cruises’ WaterWorks (above) is one of the on-board features that makes it popular with a younger demographic of cruise passengers
One of the cruise lines that has been most successful at this is Royal Caribbean International, a market leader in the Middle East cruise market, with Splendor of the Seas due to be based out of Dubai in the 2015/16 cruise season. Oasis of the Seas and Allure of the Seas weren’t designed to be the largest cruise ships in the world, according to CEO Richard Fein their huge size, which includes seven distinct ‘neighbourhoods’ and even a Coney Island-style boardwalk and New York-style Central Park, was a direct result of wanting to offer as many activities and forms of entertainment as possible.
“The millennials are an enormous market for us,” said Richard Fain during an earnings call in July. The modern mega cruise ship offers rock climbing, surfing, water slides, ice-skating and even zip-lines. Aboard the newest Royal Caribbean ships, Quantum of the Seas and Anthem of the Seas (Quantum of the Seas will stop in Dubai during her re-positioning cruise to Asia) there will even be a skydiving simulator available.
The new Quantum Class cruise ships from Royal Caribbean will feature a sky diving simulator on-board
This is what has in large part fed the tonnage war between the major cruise lines in the past few decades, with mainstream cruise lines having ever-larger cruise ships built in order to offer as many activities and as high a standard of entertainment as their competition. A welcome added bonus for the cruise lines is the fact that a larger ship carrying more people is cheaper to run, per passenger, than a smaller ship because of economies of scale.
While those cruise lines that actively target an older clientele (Seabourn, Silversea, Holland America Line, Cunard, P&O Cruises, Oceania, Regent Seven Seas etc), tend to focus on longer more immersive cruises, the cruise lines that have set their sights on a younger crowd increasingly offer more getaway-type holidays. MSC Cruises in South Africa, for instance, traditionally offers several two-night ‘booze cruise’ escapes out of Durban or Cape Town each year.
The European cruising grounds, a favourite for Middle East cruise passengers, are also rich with three to four day cruise options for younger passengers who may not have as much time to get away. “The Middle East cruise passenger in particular will take a cruise as an add-on to their longer vacations in Europe and North America,” Rosemary McNulty of Discover the World Marketing tells Cruise Arabia & Africa. “The shorter cruises, a week or less, are therefore popular with Middle East cruise passengers.”
While mass market cruise lines like Carnival Cruises, Royal Caribbean International and Norwegian Cruise Line have always made shorter cruises their bread-and-butter, we’re now seeing more brands targeting this market, especially Princess Cruises, which recently introduced three to five day cruises out of Los Angeles and Fort Lauderdale, and Celebrity Cruises, which has expended its European cruise offering to include week-long itineraries that have proven extremely popular.
In addition, cruise lines are setting their brands apart from the pack in new and innovative ways.
The new Quantum Class cruise ships will also feature a first of its kind at sea viewing pod that swings out over the side of the ship. Investsments in innovations such as these turn cruise ships into destination resorts within themselves
Carnival Cruises recently introduced a Carnival Live concert series, with bands such as Daughtry, Jennifer Hudson and Lady Antebellum performing. They also introduced a Dr. Seuss program that Stephanie Evans-Greene, Carnival’s vice president of brand communications and planning, says has been very popular with young parents.
Celebrity Cruises have new European itineraries planned around the Cannes Film Festival. “Those additions to our itineraries are very much in tune with how this segment is looking for kind of cool experiences that give them stuff to talk about,” says Lisa Kauffman, Vice-President of Marketing for Celebrity.
Food has always been an important element of any cruise since the industry first found its feet in the 60s and 70s, but now its becoming even more high profile with cruise lines teaming up with celebrity chefs to create unique on-board culinary experiences. For the upcoming Quantum of the Seas and Anthem of the Seas, Royal Caribbean International is collaborating with British celebrity chef Jamie Oliver and Miami’s Michael Schwartz.
“Our ships are floating theme parks, water parks and all-inclusive resorts,” Helen Beck told Cruise Arabia & Africa during her last visit to Dubai, when Splendor of the Seas’ upcoming Middle East cruises were announced. “All of these activities onboard, from the water parks and surf simulators, to the sky diving wind tunnels and Broadway shows, they’re all part of the cruise fare, there’s no extra cost.”
For young travellers with limited funds and only a few days in which to visit as many places as possible, who would rather have as much fun as possible while travelling between cities, instead of sitting in an airplane seat, a cruise is the perfect choice. The challenge is in turning around long-held misconceptions of the cruise industry.
Categories: Cruise Industry
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