Opportunities in the industry’s Asia expansion

The development of China as a cruise market means new ships are going there instead of to North America, which is a mild source of anxiety for travel agents in the U.S. and Canada.

But it also serves to put the spotlight on Asia and encourage travelers to explore that part of the world.

At Expedia CruiseShipCenters, trips to Asia were up 10% in 2013, up 37% last year and up 95% so far in 2015, said Matthew Eichhorst, president of the Vancouver-based franchise.

“That’s sending people on itineraries to Asian ports,” Eichhorst said. “It’s not all China; there might be a little bit of Hong Kong, Singapore, Thailand, Japan.”

Two types of customers are likely prospects. The first is experienced cruisers who have seen other places — the Caribbean, Europe — and want to expand their horizons. North Americans of Asian heritage who are curious about their ancestral homes, or have relatives in Asia, are another active segment, Eichhorst said, adding that Vancouver in particular has a large population of Asian ancestry to draw on.

River cruises in Asia have been around for a while but are benefitting from the overall rise in river cruise interest, Eichhorst said.

Because of the long flight times involved in travel to Asia, cruise customers are often looking for pre- or post-cruise activities and lodging there, adding to the attractiveness of the sale for agents.

Asian cruise sales are up, in part, because at every age travelers are more adventurous than they were 20 years ago, Eichhorst said. But travelers want to feel secure about their provider.

“They are looking for a trusted brand when they go there,” he said. “There’s definitely a few operators that are in the Asia market that aren’t what you’d call North American brands.”

Eichhorst encourages his agents to think big and initiate the conversation with clients.

“Speak to all the places they can go, and people will put it on their bucket list and maybe they’ll do Caribbean four more times before they go there, but really tell the stories about amazing places you can go,” he said. “You sort of plant that seed as to the opportunity, because it’s probably an 18-months-out buy.”

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Royal Caribbean boss vows to cut out last-minute discounting

By Lucy Huxley

The chief executive of Royal Caribbean is stamping out last-minute discounts on his cruises in the US and says he would look to extend the new policy to other markets including the UK if it is a success.

The line currently reduces fares 30, 20 and 10 days from departure, a practice that Michael Bayley says “devalues the whole product”.

“From 2016, the price will never drop. There will be no discounts beyond 30 days from departure,” he said.

Bayley accepted the new stance could lead agents to sell other cruise lines which “continue to discount all the way to departure”, but said he would rather lose that business and improve his yields and margins.

“Last-minute discounting just devalues the product and nobody, neither us nor the travel agents, is making any money,” he told Travel Weekly during the two-day naming celebrations of Anthem of the Seas in Southampton.

“We are not doing anybody any favours by discounting. We work too hard developing these phenomenal products to then charge too little for them,” Bayley added.

“We believe we have the best vacation products in the entire industry, offering customer the best value anywhere, and we believe it’s time for our customers to pay a little more for them.”

Asked if he felt this would encourage the whole cruise sector to stop devaluing its product, Bayley replied: “This is not about cruising in general. This is purely a focus on Royal Caribbean and what we feel is right for our brand.”

Royal Caribbean launched Anthem of the Seas this week and also has Explorer of the Seas coming back from a multi-million dollar refit tomorrow (Thursday).

The line also has Harmony of the Seas launching in spring 2016 and a third Quantum-class ship, Ovation of Seas, coming into service in 2018.

It’s all about relationships

It’s no big secret that so much in the travel industry is about relationships — relationships between agents and their clients, relationships between suppliers and agents, relationships between suppliers and vendors.

Indeed, relationships are the building blocks that create the foundation for the high-touch world of travel.

So, perhaps it should come as little surprise that on the last evening of the christening cruise for Avalon Waterways’ freshly minted Avalon Tapestry II, when the travel agents at my dinner table were asked by consumer press why they choose to sell certain river cruise lines over others, they responded, “It’s all about relationships.”

Initially, the answer was a bit disappointing to me. I was hoping for some real insight into how the agents choose between the river cruise lines, something more about the vessels themselves or about the overall experience that sets the companies apart. But saying that they choose based on “relationships” felt a bit like a copout; like code for better commissions or enhanced perks for their clients.

Michelle Baran
Michelle Baran

But when I thought about it a bit more, I realized that in a segment of the travel industry that is only just now starting to see more differentiation between the players involved, it can still prove challenging at times to explain what sets one company’s product apart from another. The fact that Avalon has positioned the majority of the beds in its cabins facing towards the balcony; that Uniworld Boutique River Cruise Collection has invested heavily in its extravagant exteriors; that Viking River Cruises is churning out sleek vessels at hard to beat prices; that AmaWaterways is pushing the themed river cruise envelope; or that Tauck has reinvented the lower deck cabin — these nuances might sway some, but for others these factors might still not seem like explanation enough for why they should book one line over another. Enter relationships.

The two agents at the table worked for two different host agencies that had both selected Viking and Avalon as preferred suppliers, so the decision to book more customers with those river cruises lines had already been pre-selected for them. But what dawned on me after the conversation is that while it’s definitely important for river cruise lines to continue to help us better understand and embrace their tangible differences, perhaps their most important differentiator is just that, relationships — including those between the river cruise lines and their agent partners, group travel leaders, tour operators, and of course their customers. And it will be how they continue to initiate those relationships and what they do to maintain them that will likely decide how the game plays out in the long-term.