The push to attract first-time cruisers

With an aging customer base and room for growth in the vacation market, cruise lines woo the new-to-cruise segment with shorter sailings, innovative onboard and private island amenities and targeted technology.

Illustration by Aurora72/Shutterstock.com

Two people sailing on the Seabourn Venture last October waded into the turquoise waters of Carambola Beach, St. Kitts. They strapped on snorkels, embraced and laughed as a photographer, crouching in the water a few feet away, snapped away.

It wasn’t just a day at the beach; it was a photo shoot for a Seabourn ad campaign timed to maximize bookings during Wave season. Later, from a seat in the ship’s Bow Lounge, Steve Smotrys, the line’s vice president of global sales and trade relations, reported that the Venture, Seabourn’s new expedition ship, opened the brand to a “whole new audience” of adventure-seekers who have never cruised before.

The luxury line is not the only cruise brand hunting for first-timers. Lines across the industry spent much of the past three years struggling to stay afloat. After the pandemic halted operations out of the U.S. for a full 18 months, they resumed slowly and with a slew of Covid regulations. But with Covid restrictions gone from most destinations and, culturally at least, mostly in the rearview mirror, many lines now are focusing on attracting new-to-cruise customers to propel their businesses back to the levels of profitability they enjoyed prepandemic.

“As we grow capacity in 2023 and beyond, we are redoubling efforts to attract new-to-cruise guests,” Josh Weinstein, Carnival Corp. CEO, said during a Q3 earnings call. To help that effort, Weinstein authorized a 20% boost in advertising spending in Q4 over what the company spent in the same period in 2019. In Q1, the company is planning a 30% increase, with the expectation that elevated marketing spend will continue throughout 2023 in order to boost awareness and consideration among the new-to-cruise demographic and drive demand among cruisers. “As you probably know,” he told analysts, “two of the most important drivers of new-to-cruise are word-of-mouth and advertising.”

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Sushi and cocktails on the Seabourn Venture, Seabourn’s new expedition ship. (Photo by Andrea Zelinski)

Sushi and cocktails on the Seabourn Venture, Seabourn’s new expedition ship. (Photo by Andrea Zelinski)

The vacation market

Cruising makes up a small slice of the travel pie: In 2019, it accounted for about $50 billion of the roughly $1 trillion global leisure travel market, according to Ohio-based Cleveland Research Co.

About a decade ago, about 15% of U.S. travelers had cruised, according to CLIA. Cleveland Research, however, reported that 20% of the 70% to 80% of Americans who took a vacation in 2022 chose to cruise. That encouraging stat, coupled with CLIA’s finding that 67% of those traveling internationally who have never cruised are open to it — an increase from 65.5% of prepandemic responses in 2019 — is prompting cruise lines to target the large, relatively untapped segment of travelers who have yet to sail.

The numbers are especially encouraging because consumer sentiment toward cruising took a dip during the pandemic. In 2020, only 56% of people who hadn’t cruised said they were open to it, according to CLIA. The number rose to 60% in 2021.

Adding pressure to grow vacation share is the danger of customer base attrition due to older cruisers aging out, said Mike Estill, COO of the Western Association of Travel Agencies (Westa).

Cruisers who were in their 40s and 50s when the cruise market boomed in the 1990s are now in their 70s and 80s, he said. “How many more times are they going to cruise? They have to try to figure out what’s going to be attractive to the next generation.”

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The Allure of the Seas is shifting to three- and four-day cruises out of Florida’s Port Canaveral in October. (Courtesy of Royal Caribbean)

The Allure of the Seas is shifting to three- and four-day cruises out of Florida’s Port Canaveral in October. (Courtesy of Royal Caribbean)

The value proposition

With lingering fears of recession and inflation, many cruise industry executives say they have an opportunity to introduce vacationers to a better value than that offered by land-based resorts.

And they say research and math back them up. In November, Cleveland Research examined prices for booking vacations for Christmas week, New Year’s, spring break and Easter. The firm found a 45% price gap between average rates at three-, four- and five-star hotels and resorts against sailings on new ships from Carnival Cruise Line, Royal Caribbean International and Norwegian Cruise Line.

“The value proposition of a cruise is real, it’s material, and when things get a little bit soft around the edges, you’ve got to press on on that value proposition,” said Frank Del Rio, CEO of Norwegian Cruise Line Holdings.

Through Q3, new cruisers had been slower to put down a deposit, Carnival Corp.’s Weinstein said. But business has been bustling for several cruise lines in Q4, with record-breaking sales days, weeks and months around Black Friday and Cyber Monday sales promotions.

In addition to a boost in traditional marketing, cruise brands are trying other strategies to attract new passengers. For instance, Holland America Line is offering a $50 onboard credit for each new-to-cruise booking that results from a guest referral. Both the first-time cruiser and the one who made the referral will get the credit.

Royal Caribbean Group indicated it has made significant progress attracting newbies. CEO Jason Liberty said the company’s new-to-cruise business is similar to that of 2019, in part because the line has tailored its cruises to appeal to that audience. In a Q3 earnings call, he said the guest mix that quarter was equally distributed among loyal customers, new-to-cruise and new-to-brand.

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Ziplining on Royal Caribbean’s Perfect Day at CocoCay private island. (Courtesy of Royal Caribbean)

Ziplining on Royal Caribbean’s Perfect Day at CocoCay private island. (Courtesy of Royal Caribbean)

One strategy: Shorter cruises

With the tap of a few computer keys, potential Celebrity Cruises guests can enter the “Wonderverse.” It’s a gamified digital world, complete with avatars to explore four distinct areas of the Celebrity Beyond.

By targeting digitally focused clients, primarily Generation Xers between 42 and 57 years old and their children, Celebrity hopes to introduce itself to more people who have never cruised before, said CEO Lisa Lutoff-Perlo.

“We’re very much after people who didn’t think cruising was the right vacation for them,” she said. “There are tens of millions of them within our psychographic profile who care about the same things that we deliver as a vacation experience.”

Lutoff-Perlo said the line has been intentional about attracting that clientele. Edge-class ships were designed specifically with the new-to-cruise market in mind. The line purposefully contracted with architects who had never designed ships before and so were not steeped in cruise traditions.

The line will also shorten its average cruise length from nine days to eight by 2025 to make trips more feasible for people who have less time. “We’re trying to shave off a little bit for the first-time traveler,” she said.

Indeed, other cruise executives also said the short cruise (three to five days) is a great tool to introduce the product to newcomers.

Royal Caribbean is so optimistic about the future of the short market that it is shifting the Allure of the Seas off its seven-day Eastern Caribbean itinerary and switching it to three- and four-day cruises out of Florida’s Port Canaveral in October.

“The short market is doing great,” said Vicki Freed, Royal Caribbean International senior vice president of sales, trade support and service. “So many people simply want a change of scenery, but because their everyday life is so busy have limited time.”

The line has given several ships that sail short itineraries a face-lift in recent years. The Navigator of the Seas, sailing out of Los Angeles, and the Freedom of the Seas, sailing from PortMiami, have collectively seen $231 million in refurbishments since 2020.

Similarly, the Carnival Radiance is fresh off a $200 million makeover that expanded the waterpark and added Shaq’s Big Chicken Restaurant, among other changes. The Radiance has sailed three- and four-day Mexico cruises out of Long Beach, Calif., since its refurbishment a year ago.

“Talk to avid cruisers and many will tell you that their first cruise was a short trip on a Carnival ship,” said Fred Stein, Carnival’s vice president of planning and development.

Short, affordable cruises have always been integral to the Carnival brand and a gateway to attract first-timers, Stein added. The line sails short cruises from eight of its 14 U.S. homeports and devotes about half its capacity to itineraries of five days or less.

First-time cruisers were difficult to find earlier in the pandemic, but MSC is seeing three- and four-day cruises helping to bring them in, said Koreen McNutt, senior vice president and commercial sales officer for MSC Cruises USA. That’s particularly important for MSC, which aims to amplify its presence in the U.S. The line said it is now offering more short cruises than it did in 2019.

“We have to have first-time cruisers to build a loyal base here, and we have to have three- and four-night [sailings] to do that,” said McNutt.

Virgin Voyages, which delayed its inaugural sailing by 15 months due to the pandemic, also realizes the value of short cruises. The line conducted a consumer survey ahead of the 2020 debut of the Scarlet Lady and found travelers wanted a weeklong vacation that included a couple of nights in Miami, said Nathan Rosenberg, the line’s chief brand officer. That worked perfectly for the Scarlet Lady, which exclusively operates sailings of five days or less, he said. Many of those sailors, as Virgin likes to call guests, turn into repeat cruisers: Of the 40% who book their next sailing while onboard, most are on four- or five-day itineraries, he said.

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The Disney Magic docked at Castaway Cay, Disney Cruise Line’s private island. (Courtesy of Disney Cruise Line)

The Disney Magic docked at Castaway Cay, Disney Cruise Line’s private island. (Courtesy of Disney Cruise Line)

A solution to ‘stuck’? Private islands

The primary hurdle to attracting new cruisers isn’t necessarily the price tag, said Westa’s Estill. Rather, it’s new cruisers’ perception that they will be “stuck” on a ship, and it won’t be enjoyable.

Anthony Hamawy, president of Cruise.com, suspects people who have never cruised before imagine the cruising of old: lounging around, a lot of buffets, shuffleboard and maybe bingo.

“It’s a really old-fashioned way of looking at cruising. So, what do cruise lines do? They indirectly or directly counter that by marketing a ship’s features,” like roller coasters, ziplines and a surf simulator, he said. “People start saying, ‘Wow, I can drive a go-kart on a cruise ship?’”

The strategy has worked, Hamawy said. His customers frequently call knowing the feature they want on the ship rather than a specific cruise line.

And sometimes that feature is a private island. Those islands and their beaches, waterparks and restaurants have become must-haves for a cruise line: Norwegian Cruise Line has Great Stirrup Cay and Harvest Caye; Holland America Line, Half Moon Cay (which other Carnival Corp. brands also use); Disney has Castaway Cay; MSC’s ecologically restored Ocean Cay; and Royal Caribbean’s Perfect Day at CocoCay, which is both the island’s name and its tag line.

In fact, when Royal Caribbean ran a marketing campaign before the pandemic highlighting CocoCay’s waterpark, which features a 135-foot-tall waterslide, Hamawy said that people would call asking, “Which cruise line is it that has the island with the largest slide in the Caribbean?”

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Celebrity Cruises’ “Wonderverse” digital world is designed to appeal to digitally focused clients — primarily Generation Xers. (Courtesy of Celebrity Cruises)

Celebrity Cruises’ “Wonderverse” digital world is designed to appeal to digitally focused clients — primarily Generation Xers. (Courtesy of Celebrity Cruises)

Opportunities for travel advisors

Short cruises, said Kelly Brewer of Arkansas-based Brewer Travel, are “absolutely a gateway to longer sailings.”

She said she spends less than 10% of her time on short cruises because they take a lot of time and don’t pay as well, but she knows they can convert a first-time client into a long-term, very profitable one.

Her proof? She had booked a first-time cruiser for five days on the Carnival Triumph. That was enough to get the client hooked on cruising. She later called back and booked Haven suites for herself and her children on a seven-day Norwegian Cruise Line voyage in Alaska and is currently booked into an aft wraparound Excel Suite on the Carnival Celebration in January. On that sailing, she also secured three ocean suites for her kids.

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