Selling the Sea an Inside Look at the Cruise Industry
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1367. chfm 3/14/07 9:27 AM Page i Selling the Sea An Inside Look at the Cruise Industry SECOND EDITION Bob Dickinson, CTC Andy Vladimir, CHE John Wiley & Sons, Inc. 1367. chfm 3/14/07 9:27 AM Page iv 1367. chfm 3/14/07 9:27 AM Page i Selling the Sea An Inside Look at the Cruise Industry SECOND EDITION Bob Dickinson, CTC Andy Vladimir, CHE John Wiley & Sons, Inc. 1367. chfm 3/14/07 9:27 AM Page ii This book is printed on acid-free paper.᭺ ∞ Copyright © 2008 by John Wiley & Sons, Inc. 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For general information on our other products and services or for technical support, please contact our Customer Care Department within the United States at (800) 762-2974, outside the United States at (317) 572-3993 or fax (317) 572-4002. Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may not be available in electronic books. For more information about Wiley products, visit our web site at www.wiley.com. Library of Congress Cataloging-in-Publication Data: Dickinson, Bob. Selling the sea : an inside look at the cruise industry / Bob Dickinson, Andy Vladimir. — 2nd ed. p. cm. Includes index. ISBN: 978-0-471-74918-9 1. Ocean travel. 2. Cruise ships. I. Vladimir, Andrew. II. Title. G550.D53 2007 387.2Ј430688—dc22 2006022537 Printed in the United States of America 10987654321 1367. chfm 3/14/07 9:27 AM Page iii For Jodi and Ute, our touchstones 1367. chfm 3/14/07 9:27 AM Page iv 1367. chfm 3/14/07 9:27 AM Page v CONTENTS Preface vii Acknowledgments xi Chapter 1 Casting Off: The Evolution from Steamship Transportation to Cruising as a Vacation 1 Chapter 2 Coming About: The Foundation of the Modern Cruise Industry 33 Chapter 3 Life on the Ocean Wave: Living and Working Aboard Modern Cruise Ships 63 Chapter 4 Home on the Rolling Deep: Case Studies in Backstage Management 93 Chapter 5 Getting Underway: The Public Discovers Cruising Vacations 117 Chapter 6 Your Cruise Line GPS: Positioning and Differentiation of Cruise Lines 149 Chapter 7 Now Hear This: Marketing Communications— A View from the Bridge 199 Chapter 8 Pieces of Eight: Making Money on the High Seas 227 Chapter 9 Booking Passage: A Fresh Look at Today’s Travel Agent 263 Chapter 10 Bob & Andy’s Vacation Store: Selling the Sea—The Way We’d Do It 291 Appendix CLIA Member Cruise Lines 327 Index 329 v 1367. chfm 3/14/07 9:27 AM Page vi 1367. chfm 3/14/07 9:27 AM Page vii PREFACE It’s a typical Saturday morning in July. Americans all over the country are heading off on their one-week or two-week vacations. In New York, men and women wearing white gloves and dressed in the navy blue crew uniforms of the Queen Mary 2 are at LaGuardia and Kennedy airports to greet passengers coming in from all over the world. There are the Ow family from Beijing, the Tatas from Bombay, the Ambersons from Liverpool, and the Alberginis from Salt Lake City. All of them, along with a couple thousand others arriving by taxis, cars, and trains, will be board- ing the Queen Mary 2 that day to cross the Atlantic to Southampton, England, in six and a half days. For many of them, perhaps one third, this will be their first voyage on any ship ever. For others, it will be their first transatlantic voyage. In Miami, Fort Lauderdale, Port Canaveral, Tampa, and Jacksonville, the Smiths, the Gonzaleses, the Jacksons, the Finches, the you-name- them are lining up to get onto the Carnival Destiny, the Voyager of the Seas, the Norwegian Dream, the Caribbean Princess, or the Celebrity Millennium. They will be sailing to Puerto Rico, Jamaica, Mexico, and dozens of other ports in the Caribbean and beyond. Some will be going through the Panama Canal and disembarking in Los Angeles, where thou- sands of people will be standing in line for the return trip. In Honolulu, the push to get on Norwegian Cruise Line’s Pride of America will have started, and in Lisbon, Monte Carlo, and Piraeus, passengers will be boarding one of Seabourn’s luxurious vessels. In fact, with 10 million North American cruisers in 2005, we can say that all over the world, on every one of the seven continents, people will be boarding cruise ships to go somewhere— not just on Saturdays, but every day of the week. In a few short decades, what began in Miami as a small cottage business has turned into a mega- industry, pouring $32 billion into the U.S. economy in 2005 alone. The ships themselves are no secret. They belong to the nineteen industry members of Cruise Line International Association (CLIA), an vii 1367. chfm 3/14/07 9:27 AM Page viii viii Preface industry association composed of cruise line sellers (travel agents) and cruise lines. The two biggest players are Carnival Corporation, which by itself owns eleven brands and controls 55 percent of the market, and Royal Caribbean International, with two brands and 25 percent of the market. Norwegian Cruise Lines is a distant third, with 8 percent. Everyone else shares what’s left over—which is, to be honest, not much! So who are these 10 million people who like to take cruises? For the most part, they are married Baby Boomers who have a current passport, love to travel, and do so frequently, according to CLIA research. Other studies show that, for the most part, their average age is forty-nine. Only one in four of them is retired. Sixteen percent take children under eight- een along with them. Then there are the travel sellers themselves—agents and agencies that make nine out of every ten sales of cabins on cruise lines. About 16,500 of them are members of CLIA, making it the largest travel association in the world. So there it is: nineteen cruise lines, 16,000 travel agents, and 10 mil- lion cruisers. That’s the cruise industry—but not all of it, of course. There are the yards that build the ships—four of them particularly: Fincartieri in Italy, Chantiers de l’Atlantique in France, Meyer Werft in Germany, and Kvaerner Masa in Finland. There are the provisioners that deliver thousands of cases of everything from lobsters to tomatoes to vodka weekly to these ships, as well as thousands of other businesses, big and small, that supply sheets and towels, tablecloths, uniforms, enter- tainers, and more. So what’s to get excited about? Why are the people engaged in this business, like us, so passionate about what they do? Why are the cruis- ers so excited about their vacations that many of them are already plan- ning their next cruise—before this one is even over? Why does the media spend so much time reporting on the cruise industry—much more than they spend reporting happenings at land-based resorts? Why is CLIA the largest travel organization in the world? One answer to that question comes from Terry Dale, the CEO of CLIA. This is a product like no other I have ever experienced, and as our research shows, so many Americans haven’t experienced it yet. Only 17 or 18 percent of the U.S. population has ever cruised. Once you get them to take that initial step and board that ship, they become hooked on our product because it’s phenomenal. When you look at the value of the vacation ex- perience on board and off board. The level of staff and service that the crew provides, the quality of the food and cuisine, the entire experience from the moment you board to the moment you disembark that is truly magic. This is an experience a consumer can never have except aboard a ship. 1367. chfm 3/14/07 9:27 AM Page ix Preface ix Dale is passionate about what he does and who he represents.