After 27 years of operating as a private company, Viking is going public.
While Viking founder and chairman Torstein Hagen made the case in the company's IPO registration form that the core of the cruise line's business will remain the same, one part might have alarmed travel advisors.
Viking said that it plans to grow direct bookings.
"With a marketing database that includes more than 56 million North American households, we believe our direct bookings will continue to grow and add value to our business," the line said in its IPO.
While the IPO registration states that Viking expects direct bookings to grow, it also said the travel advisor channel is important to the brand.
"Travel agencies generate a substantial amount of bookings for our cruises, and we are committed to maintaining and strengthening this distribution channel," Viking wrote, noting the brand has preferred relationships with large travel agency consortia and employs sales managers in key markets to keep travel advisors aware of its products.
"The loss of any one of these preferred relationships could disrupt our travel agent distribution system and have an adverse impact on our business," the company said.
More than half of Viking's guests booked direct last year, according to the filing. That includes 18% of the brand's ocean and expedition guests who booked their next cruise while onboard in 2023.
A Viking Longship cruising the Rhine River. Photo Credit: Viking
ASTA CEO responds
Responding to Viking's statement about increasing direct bookings, ASTA president and CEO Zane Kerby stressed travel advisors' prominent role in selling cruises.
Referring to a Phocuswright study, Kerby said travel advisors booked nearly 59% of all cruises in the U.S., and projections show advisors will be selling nearly 71% by 2026.
River cruising is competitive "with a dozen or more fantastic options," he said. "Viking would be wise to embrace U.S.-based travel advisors as their primary distribution channel, because, quite frankly, they are."
Viking operates 81 river ships worldwide, plus nine oceangoing and two expedition ships. The company has consistently relied on a multipronged distribution strategy to fill its ships.
In a Travel Weekly story about Hagen and Viking in April 2013, Hagen said "it's no secret" that the company aggressively pursues direct marketing.
"We do direct mail, and we take direct bookings," Hagen had said. "We really don't care where people book. The main thing is that they do book. But when they book with us, travel agents get commissions on everything."
Although the company's revenue has grown nearly 150% since 2017 -- from $1.9 billion to $4.7 billion -- Viking reported a $1.9 billion net loss in 2023 as the company continued to recover from the pandemic pause in operations. Last year, the line cruised with an occupancy of 93.7%, which was up from 78.4% in 2022.