Royal Caribbean says high-speed Internet is spreading the word

Royal Caribbean says high-speed Internet is spreading the word

Royal Caribbean Cruises Ltd. credits its high-speed Internet (Voom on Royal Caribbean, Xcelerate on Celebrity) for helping to boost onboard revenue. The service has also been an effective marketing tool.

When passengers are easily able to convey on social media how much fun they're having on vacation, it's excellent brand advertising, especially among millennials, said Royal Caribbean International CEO Michael Bayley.

"We have made a journey over the past couple of years from traditional to digital marketing," Bayley said on Royal Caribbean's first-quarter earnings call on Thursday. "We have maneuvered ourselves into a strong position in the social media universe." The accelerated Internet, rolled out across Royal Caribbean's fleet in 2016, has been a part of that journey. The service is enjoyed by millennials which helps attract new-to-cruise millennials, Bayley said.

For the past few years, RCCL chairman Richard Fain has been trumpeting the importance of shipboard technology to attract younger passengers. On Thursday, he and Bayley also touched on two other millennial trends: the preference for experiences over stuff and the desire for short vacations. Royal Caribbean says it is poised to tap into both trends.

One way is by making major investments in its short-cruise product and private island.

Royal Caribbean is spending $90 million to renovate the Mariner of the Seas, which will have new attractions and spaces when it begins sailing three- and four-day cruises out of Miami in June. Three months ahead of relaunch, sales for the refurbished Mariner are robust, said CFO Jason Liberty.

With the 3,114-passenger Mariner sailing two cruises per week, "it's like having an Oasis-class ship in the short-cruise market," Fain commented.

The Mariner will sail to private isle CocoCay, which is due to unveil a huge upgrade in September, promising to give cruisers many new experiences, like 13 water slides, a huge swimming lagoon, a wave pool, a zipline and a tethered helium balloon. Fain said CocoCay will "get tongues wagging just as our new ships have."

A refurbished Mariner plus an all-new CocoCay is an "accelerated on-ramp for millennials and new-to-cruise passengers," Bayley said.

For the quarter ended March 31, Royal Caribbean reported net income of $218.7 million, up from $214.7 million the year before. The company managed to top last year's exceptionally strong first quarter. Revenue was up 1% on the strength of increased onboard spending.

Looking ahead to the rest of the year, Royal Caribbean said its 2018 booked position is better than last year's record high and ahead in both volume and pricing.

"This year is proving to be another strong year with all our brands firing on all cylinders," said Fain.


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