Like hotels and convention centers, the cruise industry is worried that the firestorm over companies planning lavish corporate retreats in a time of economic pain will affect its charter, meetings and incentive sales.

But so far, that facet of the cruise industry actually appears to have benefited somewhat from the upscale meetings backlash.

Some cruise lines and travel agents report an uptick in the corporate incentive and meetings business on ships, and they equate it to the value of doing such events on a cruise compared with a land-based option.

"Our business in this area is up, and we have a significant charter looming," said Howard Moses, president of the Cruise Authority in Atlanta, an agency that specializes in large group cruises. "My sense is that while this business is likely overall headed south, for the time being, cruising may see a boom in this area due to the overall value meetings aboard ships provide as compared to a land program."

Many planners who focus on cruise agree that cruising’s cost structure gives the industry an advantage.

"For those that are savvy and do the math, what they can get on a cruise ship right now is amazing," said Joyce Landry of Landry & Kling, a group that specializes in incentive cruises and planning meetings at sea. "This is the year to do it. I don’t think we’ll see these prices again."

Landry said business was doing well because her company had targeted companies that are not being affected by the so-called AIG or Wells Fargo effect, the public anger faced by companies that accepted government bailout funds and then planned what seemed to some taxpayers like extravagant corporate getaways.

"You can’t get corporate jets, you can’t take a trip to Las Vegas or go down to the Super Bowl on the taxpayers’ dime," President Obama recently said of corporations that receive bailout money.

Landry said that her firm targeted private companies that were not concerned about shareholders or media scrutiny tarnishing their image.

"If we were focused solely on automotive or pharmaceuticals, we’d have a problem right now," she said. "If you are involved in things like consumer staples, technology and insurance industries, and not the financial side, then companies are still doing what they need to do to compete in this market, and employee recognition is part of that."

Some cruise lines also said business in charters, meetings and incentives was up.

"We have seen a slight increase," said Dondra Ritzenthaler, senior vice president of sales for Celebrity Cruises. "We have been spending marketing dollars in meetings and incentives publications and have a dedicated sales team just for company meetings and incentives."

Richard Fain, CEO of Celebrity’s parent company, Royal Caribbean Cruise Ltd., said in October that conferences and meetings made up 15% of Celebrity’s business and were becoming increasingly important.

"Conference rooms may not be sexy, but they are an important part of our customer base," Fain said during a tour of the line’s newest ship, the Solstice.

Agents consistently noted that even if hotels offer groups a break on room rates, the high costs of meals, entertainment and use of hotel audiovisual equipment made them much more expensive.

"A cruise is roughly half the price of a similar land stay," said Moses. "The hotels really gouge you when it comes to meeting venues."

One agent recalled arranging and running a meeting at a hotel last year, where the agent was charged $200 to have boxes moved from one room to another and had to pay a hotel electrician $100 an hour to plug in a computer. (All of the electrical outlets were locked, the agent recalled.)

Irrespective of the relative value of a cruise, companies are still nervously self-conscious about cutting costs and appearing responsible.

"They are really searching for ways to motivate and reward their top producers and do it in a way that is appropriate, both financially and image-wise," Landry said. "People are selling their hearts out in order to get their numbers, and the last thing a company wants to do is not thank their top performers."

She said those concerns might manifest themselves by, for example, cutting back on pillow gifts, not offering a choice of airline or choosing a cruise in the Caribbean rather than in the Mediterranean.

Bigger impact on small ships

The small-ship luxury sector, already hit hard by eviscerated 401(k)s and stock portfolios, has felt a more direct downturn than mass-market cruising when it comes to full-ship charters. Much of that is because those vessels, as a result of their price point and exclusivity, are usually chartered for incentives as opposed to meetings.

And because of their luxury image, they are events venues that might appear lavish.

"We had one bank that, as a result of the Wells Fargo effect, canceled a fully paid charter four days before," said Bob Lepisto, president of SeaDream Yacht Club. "It was a short charter. The chairman of the bank didn’t want to risk it."

Charters represent 30% of SeaDream’s business, and Lepisto said that the number of charters that have fallen off this year "is not insignificant."

"Year over year, I guarantee the numbers are down," he said. "The charter business is tough for anyone who does meetings and incentives."

Where he has seen business hold steady is in the private charter business for weddings, anniversaries and family reunions.

"People continue to want to do special events, and the value of doing a special event for 50 couples on SeaDream is exceptional," he said.

Lepisto is not mourning the loss of the charters because, he said, so far his two small ships are full this year, if not at quite the rates the company got in 2008.

The advantage of selling to individual passengers vs. doing charters is that the individual is more likely to come back.

"Every [individually booked] guest that gets off chose SeaDream personally, and I can be confident that they will get off and tell quite a few friends and relatives," he said.

"And they can afford SeaDream. In many cases the individual incentive award winner who comes on SeaDream can’t individually afford our product for the future. In an interesting way, individual guests are more valuable to us."

Silversea’s senior vice president of corporate and incentive sales, Sean Mahoney, said that companies were still signing full-ship charters but that the line had experienced a downturn.

"Like others, we are experiencing a slowdown in corporate and incentive business," he said. "Anybody that would tell you there is not an overall slowdown would not be entirely truthful.

"Some companies are delaying decisions or waiting to make commitments," he said. "On the flip side, there are some companies who are private and who aren’t afraid of how they are going to be regulated by [the Troubled Asset Relief Program] who are spending because this is part of their corporate culture and how they achieve business results."

Mahoney also sits on the board of the Society of Incentive and Travel Executives and is working to change the perception of incentive meetings.

The news media, he said, have "taken only one side of the story and incorrectly characterized meeting events as boondoggles or junkets or retreats. They fail to understand the science of incentive travel. If done the right way and responsibly, they are self-liquidating; they pay for themselves."

One luxury line that says it is bucking the downward charter trend is Seabourn Cruises.

"We have an unprecedented 17 charters for 2009," said Bruce Good, spokesman for Seabourn. "Full-ship charters still provide a good value and are a secure bet for organizers, so we expect it to be solid."