Fifty years after modern cruising evolved from passenger transport, lines based in Europe are making inroads in America. Their ships tend to be small, but their aspirations are sizeable.
Ponant is one of several European lines looking toward North America for expansion opportunities.
Ponant is one of several European lines looking toward North America for expansion opportunities.
For many North Americans, travel between the Continent and the New World in the 19th or 20th centuries came on European shipping lines ranging from Nord-deutscher Lloyd in the Baltic to Navigazione Generale Italiana in the Mediterranean.
But when cruising supplanted the passenger lines in the 1960s, companies based in Miami took the lead. By the 1990s, American companies had extended their reach to Europe, either by scheduling cruises there or by acquiring European lines -— Costa Cruises being perhaps the biggest example of a European brand cultivated by a North American company.
Now, 50 years after modern cruising’s foundation, the European lines are finally coming back to America.
Their names hardly roll off the North American tongue: Hapag-Lloyd Cruises. Ponant. Hurtigruten. But all these lines are hoping to expand their modest base of business in the U.S. and Canada by bulking up their sales and marketing efforts in the North American market.
The largest European line, MSC Cruises, is making a concerted push to augment its European and South American traffic with a third leg in North America. In November, it staged a spectacular naming ceremony in Miami for its newest ship, the 4,000-passenger MSC Seaside, with entertainment by tenor Andrea Bocelli and Latin pop singer Ricky Martin and a christening by film star Sophia Loren.
Some 3,000 travel agents, media and VIPs witnessed the christening, the first for MSC in North America.
Gianni Onorato, CEO of the Geneva-based line, said North America continues to be the deepest source market for passengers worldwide, accounting for nearly half of the 26.7 million cruisers last year.
“I keep saying the North American market is a huge opportunity for all,” Onorato said in an interview last December. “We just want a little piece of the cake.”
A few European lines have focused on North America from the start, e.g., Silversea Cruises, which is owned by an Italian family. And some concentrate on one market, such as Celestyal Cruises, which is dedicated to Greece.
Even including MSC and its megaships, the market share for European cruise lines sourcing passengers in North America is tiny. Most operate at the small-ship end of the spectrum, with vessels carrying well under 1,000 passengers.
Typical is the Norwegian company Hurtigruten, a brand that was active in North America for a number of years under the name Norwegian Coastal Voyages, a nod to its origins as a transportation service along Norway’s craggy peninsulas and fjords.
A decade ago, it decided to emphasize its expedition business, rather than coastal cruising, in North America.
Well known at home in Europe, Hurtigruten remains obscure to Americans who, if they know about cruising at all, are familiar with names such as Carnival, Royal Caribbean International, Norwegian Cruise Line and Princess.
Against behemoth ships from those brands, Hurtigruten sails the 317-passenger Fram and the 970-passenger Midnatsol, pitching them from a marketing and reservations office in Seattle with only 50 people, even following a recent expansion.
Undaunted, Hurtigruten is intent on becoming better known here, said William Harber, president for the Americas at Hurtigruten. In 2012, new investors recapitalized the company, paving the way for it to order a newbuild fleet of 530-passenger, state-of-the-art polar expedition ships.
The first of the two, the Roald Amundsen, is scheduled for delivery next year, with the second, the Fridtjof Nansen, to follow.
“For Hurtigruten, that means a big opportunity to attract new guests,” Harber said.
The line could rely on countries where it is better known, such as Germany, its No. 1 source market, and the Scandinavian lands, but with new, expensive ships on the way, it has to prospect more broadly.
‘In the expedition cruise business, the U.S. represents an outsized proportion of total cruisers.’
—William Harber, Hurtigruten
“Last year, 45,000 people sailed in Antarctica, and 15,000 of them were Americans,” Harber said. “So in terms of the expedition cruise business, the U.S. represents an outsized proportion of total cruisers and also cruisers to Antarctica.”
Harber and his Hurtigruten team are hoping the line’s long experience in Norway and other icy climes will give it credibility and appeal as it makes its way in the crowded expedition field.
“Cold water cruising is in their DNA. They do it better than anyone,” Harber said. “The captains just know what they’re doing in these waters. That’s what they call home.”
Another name from Europe with new ships and a need to fill them is Ponant. Founded in 1988 by a French ship captain, it operates expedition ships with a luxury component, such as the 180-passenger Le Laperouse, the first of six ships in its class, which launches this month with a cruise in Iceland.
Ponant has grown its business in North America, although rather quietly and with select agencies.
“What I have said about this brand is that from an American perspective, it is the best kept secret in America, and that is about to change in a big way,” said Edie Rodriguez, Ponant’s Americas brand chairman and corporate special adviser.
As much as anything, the October hiring of Rodriguez signaled Ponant’s intentions in North America. The veteran executive, who excels at promotion, had just finished four years as president of Crystal Cruises and is well known among U.S. travel agents.
But hiring Rodriguez was only part of the plan. Ponant also increased its U.S. marketing budget and hired more sales staff, so agents have more regular contact and develop a better understanding of the new vessels.
“We’re really getting out to the agency community,” Rodriguez said, “with our VP of sales and our director of sales, to our strategic partnerships with players like Virtuoso and Travel Leaders and soon to be others, to make sure that if you are a smaller agency, a home-based agency or a larger agency or one of the national-type consortia, that you understand this brand, so that you can be better empowered to sell this brand.”
Like Harber and other top European cruise executives, Rodriguez has gained new lieutenants.
Theresa Gatta, a veteran of Travel Impressions and American Express Vacations, joined as vice president of sales for North America. Ellen McIlvaine, whose resume includes Zegrahm Expeditions and Red Lantern Journeys, became director of business development for the key Pacific Northwest region.
Ponant’s U.S. headquarters is in New York, with a staff of 22 based there, Rodriguez said.
Also fishing more ardently in North American waters is Hapag-Lloyd Cruises, which is based in Hamburg, Germany, and operates in the luxury and expedition segments. Starting next year, it will launch a multilingual expedition ship, the Hanseatic Inspiration, which in the summer of 2020 will explore the Great Lakes.
Company CEO Karl J. Pojer said he expects the itinerary to gain a lot of attention for Hapag-Lloyd in North America.
‘We have the interest already now from the U.S. agencies, the Canadian agencies.’
—Karl J. Pojer, Hapag-Lloyd
“We have the interest already now from the U.S. agencies, the Canadian agencies. I think that will give us a good boost in North America,” Pojer said.
With a lineage in Germany dating to 1847, Hapag-Lloyd serves the European market with German-language ships, such as the Europa and the Bremen. It serves the U.S. and other international guests with English-language ships, such as the Europa 2 and the Hanseatic.
Hapag-Lloyd’s attempt to bridge the cultural divide is one of the biggest challenges for European lines seeking U.S. customers.
Guests on Ponant ships are primarily French speakers, with a smattering of other languages. Rodriguez said that after joining Ponant, she sailed with her husband, and they felt comfortable not being fluent in French.
“Yes, we are a French flag, and yes, we are a French brand. But I really found it to be an international brand experience,” Rodriguez said.
Pojer said 30% to 50% of the passengers on Hapag’s Europa 2 cruises are non-German speakers.
Another cultural issue is that Europeans are more likely than Americans to be smokers. But all of the European lines say they restrict smoking to a few areas of the ship, just as lines based in North America do.
“More and more Europeans are acclimating and accepting that,” Rodriguez said.
Food is a third sticking point for some North Americans, who wonder whether the fare onboard a European line will be to their taste.
Harber said that’s not a problem.
“The good news is the cuisine found on Hurtigruten — they call it Norway’s Coastal Kitchen, so it is a lot of fresh and locally sourced seafood — [is the type of cuisine] Americans really do enjoy: a lot of salmon, a lot of cod. So from that standpoint, it’s a real popular thing.”
While dinner and lunch can be cross-cultural, however, breakfast is less negotiable for Americans.
Onorato said MSC’s Italian crews have learned to make American bacon and pancakes and to serve coffee piping hot rather than medium-warm.
“We needed to follow what the customer wants, so we have made many changes,” he said.
With the prospect of drawing tens of thousands of North Americans annually, MSC set up a unit in its Florida office headed by a brand performance director charged with making shipboard culture conform to non-European preferences.
“We have created a cell, a small cell, in our Fort Lauderdale office to be dedicated to the North American,” Onorato said.
But European lines say they can only go so far without losing their identities. Onorato, for one, vows MSC will never do pizza the way it’s done on North American ships. He cited MSC’s Italian-made ovens, Italian ingredients and the special Neapolitan training of its pizza chefs as intrinsic factors in the taste.
All the leaders of European-based lines also say they’ve got a cosmopolitan passenger contingent that holds its own appeal to some Americans.
“We have something very, very unique, which is the type of ambience aboard our ships, which is given by the rest of the customers onboard,” Onorato said. “We have a much, much bigger portion than any other cruise line or brand in North America in terms of the number of non-U.S. guests aboard. This creates an ambience different than other markets.”
Rodriguez added: “Really, part of the conviviality of traveling is meeting these fellow wanderlust travelers from all over the world, making new friends. And those new friends you can keep in touch with in any part of the world thanks to the internet and social media.”
Finding a target market
The trick for European lines is finding the right North American guests and qualifying them for the right ships.
For the smaller lines with limited resources, that generally means working through agencies and refining their marketing strategy.
“Before, we tried to appeal to everyone,” Harber said. “We’ve just done a big segmentation analysis of the U.S. travel agent market, and we’re really focusing on fewer travel agents to do bigger revenue.”
Mostly that means finding agents who focus on expeditions, whether by land or by sea.
“But it may also be going to someone at the top consortia and having them help identify who are the right agencies,” Harber said. “And even within the right agencies, those agencies might identify the right offices, and within those offices, the right agents. It really may come down to a few passionate people in the agency who can really drive the business.”
European lines are also forging partnerships they hope will yield customers. Ponant has partnered with Tauck and Abercrombie & Kent on full or partial ship charters.
MSC has become the official cruise line of the Miami Dolphins football team, which means photo shoots onboard MSC ships with Dolphins cheerleaders and promos of the MSC Seaside in the luxury boxes at the Dolphins’ Hard Rock Stadium.
MSC also sponsored events in December at Art Basel Miami.
“Obviously, we’re looking for different kinds of people,” said MSC Cruises North America president Roberto Fusaro, who cited Weight Watchers as another partner that is filling MSC ships sailing from Miami.
While MSC has ships year-round in South Florida, the other lines roam the globe. All are getting ships to expand their fleets and have the finances to play for the long term. MSC and Ponant are owned by wealthy European families, and Hapag-Lloyd is owned by German travel giant TUI Group.
Hurtigruten is owned by three investment firms led by London-based TDR Capital, which has financed the two $220 million Hurtigruten Explorer-class ships with options for two more ships.
“We had private equity investors come in [in 2014], and they took the company private and invested funds in the newbuild and around the expedition product,” Harber said. “So what they saw was where the market was going and a brand that already had that in its DNA.”