1. Cruisers want the “travel experience” they read about from others
Who do you trust? For ages “friends and family” were primary sources of product information. Today your “social networks” are the new friends and family.
2. Price is not the bottom line!
Good news for cruise industry margins. In a practical sense, the cruise market can grow its share of the travel industry by using the “link together and take away” strategy.
3. “The most important relationship you have with your customers is increasingly being replaced with software” - Luxury is Redefined, Critical Mass
Like any social human group, they are more formed than created. It is a difficult undertaking for marketers to “engineer.” The network develops as there are common interests and needs. The network is user-generated, user-organized, user-distributed and user-regulated and will weed out impostors. (I don’t trust you, I don’t believe you, don’t try to sell me something).
5. The marketer’s best approach is to find the “superusers”
In other words, get the leaders of the “pod chirping.” The right product or service must be focused on gaining the attention on the alpha influencer. If your idea can get the alpha influencer chirping, then it will evangelize it to the rest of the pod. Rapidly act on their feedback, create tools and content to help them.
Posted By Cruise Market Watch / 19th November 2008
Lets face it; there are just three ways to grow revenue:
1. Increase spending and/or frequency among current customers
With a combination of increased passenger capacity, pressure on pricing and the general economic malaise, number one will be difficult in 2009.
2. Acquire customers from your competition
Number two may be easier, given uncertain levels of brand loyalty among contemporary lines in particular (a subject for a future post). But the result may be lower prices and squeezed margins.
3. Expand the cruise market and acquire new customers
The time is ripe for number three.
A) The market potential is certainly bigger. According to the Allied Academics International Conference the cruise industry holds only two percent of the market share in the total vacation industry. Only 45% of the target North American market has EVER cruised – and there is no reason over time this can’t rise to 70%-80%.
B) The economy may prompt non-cruisers to try something different, of a greater perceived value.
How do we win them? By utilizing a “Link Together and Take Away” strategy.
“Link together” means partnering the cruise line’s brand into the extended, non-vacationing lives of consumers. This shouldn’t be done haphazardly. Research on each lines core customers should be conducted to see what other brands and products it’s best customers tend to gather around, use most and associate with. Then, reach out to create logical branding partnerships to “link together” – drawing in new cruisers via the associations.
Fashion retailers: runway and fashion show on board
Auto makers: place an automobile on deck for one of 3,000 passengers to win. In return, auto manufactures run a sales contest giving away cruises to top performers
Real Estate: buy a new home from a builder and get a free cruise
Refrigerator: A Northland stainless mini-fridge in each stateroom. In return, each sold in stores has a sicker inside (take a cruise and for seven days you won’t have to use this)
These are just examples. It’s all about creative ways to get the cruise line’s brand in front of non-cruisers who, in their purchasing behavior, mirror the line’s current best customers.
Fortunately consumers surf different web sites and make use of significant research months before they make their vacation choice. In addition to buying Google keywords “cruise,” our ads should also be appearing when they search “getaway spa.” In addition to posting display advertising where current cruisers hang out (travel sites and cruise boards) place them in spa message boards, spa blogs, spa websites and spa niche publications. Invite influential spa experts to sail and lecture. Importantly, the messaging should be specifically tailored to address each particular niche (spas, exotic destinations etc.,).
In sum, 2009 will be an exciting and challenging year. There is an opportunity to go after first time cruisers. By linking together with the non-travel brands that resonate with a given line’s target prospects and by bringing in new travelers to experience the spa or destinations we can all make out like Bond… James Bond.
Posted By Cruise Market Watch / 11th November 2008
Our monthly Cruise Search reflects change in demand and onlinemarket share. U.S. online cruise search is estimated at 7.0 million monthly unique individuals for the month of October. CruiseSearch shrank for the third consecutive month, both versus the prior month and October of last year. All this points to a continued weakening in online cruise search activity as the economic conditions faced by travelers have worsened.
Richard D. Fain: “A little over a month ago we witnessed a historic change in the financial markets and in many of the key drivers of our business. The resulting deterioration in consumer confidence and spending now requires us to confront new realities…
One interesting aspect for us is the need to recalibrate our forecast for a different pattern of consumer behavior. Historically we’ve been very successful in using the pace and type of current bookings to predict future demand. We have enormous volumes of data that allow us to extrapolate future bookings based on how people are buying cruises today and what their price elasticity is. Unfortunately, the current turmoil came suddenly and disrupted our normal patterns.
In addition, the feedback we get from our guests and from our travel agent partners clearly demonstrates that the consumer is as confused about the economic situation.”
Brian J. Rice: “As we’ve seen in other analogous situations, during times of sudden change and high uncertainty, our customers hold off making any decisions they can. At the beginning of the month we saw modestly lower booking volumes compared to a year ago but nothing unusual given our strong order book at the time. Bookings began to show additional weakness in mid-September, about the time of the Lehman bankruptcy. Towards the end of the month when Congress was dealing with the bailout package, we began to see a more rapid decline in new demand.
For the last two weeks despite the dramatic volatility in the market, bookings appear to have leveled off and we have actually seen a more consistent pattern.”
Our monthly Cruise Search reflects change in demand and onlinemarket share. U.S. online cruise search is estimated at 8.8 million monthly unique individuals for the month of September. Cruise Search shrank for the second consecutive month, both versus the prior month and September of last year. This points to continued weakening in online cruise search activity as the economic conditions faced by travelers have worsened.
Percentages in the charts below represent the approximate share of all online cruise traffic.
Chart 1 - % of traffic for top Cruise Lines from all cruise related traffic (click to enlarge)
Chart 2 - % of traffic for top booking sites from all cruise related traffic (click to enlarge)
There is word is that cruise bookings have declined further in October, and this is being reflected in last minute discounting of fares. Royal Caribbean posts earnings on Monday, October 20. It will be interesting to hear how it forecasts for coming quarters.
Posted By Cruise Market Watch / 13th September 2008
Our monthly Cruise Search reflects change in demand and onlinemarket share. U.S. online cruise search is currently estimated at 9.4 million monthly unique individuals. Cruise Search shrank vs. both the previous month and August of last year. This indicates continued tempering in online activity likely based on the economic conditions faced by travelers.
Posted By Cruise Market Watch / 11th September 2008
Marketing, boiled down to its essence, is about crafting product and communications.
That held true in 1690 for Dom Pierre Perignon when word got around the palace of Versailles the blind Benedictine monk had combined stronger imported bottles and airtight corks with grapes from the northern most growing region of France. It also holds true today for Harry Winston over discrete invitations to select male customers in Tokyo’s Midtown for first picking rights in a hidden VIP room.
The point is that combining art and science, marketing requires shaping communications to best position your brand among desired audiences to ultimately influence a result – a purchase.
The means of communication can take many forms: various media, word-of-mouth, social networks and the often overlooked, ubiquitous email.
The shear volume of emails crossing cyber-space from businesses via employees is staggering – and almost every single one is a marketing opportunity lost.
Imagine, as a 46,000 employee cruise company, each email leaving your business is wrapped with a controlled, branded message and/or call to action. As each is forwarded around and replied to, the exposure multiplies exponentially. Before long, you’ve generated as much reach and frequency as a national television campaign – with measurable click-through rates and among an audience you know is engaged with a pre-disposition or interest in your product.
The same effect would work for travel agencies. It’s a simple and easy process the folks at wrapmail can painlessly set up. They kindly developed the samples above.
Posted By Cruise Market Watch / 8th September 2008
Here is an idea. Symbolically shed the vestiges of corporate life and ritually transition into the freestyle cruising culture.
Encourage owners to bring their Blackberry’s and iphones and upload a NCL widget. In a fun and lighthearted way users would transform their “electronic lease” into a “personal freestyle cruising digital assistant.”
Talk about fish swimming against the school!
The widget would become passenger’s freestyle 2.0 on their phone – leading them through the leisure metamorphosis – displaying shipboard services, event calendar, download pictures from phone to personal web page, delivering messages and even facilitating epayments.
Benefits:
The ritual transition communicates and strengthens the brand positioning
The widget tool increases and facilitates on-board spending
Acts as a retention device as the widget facilitates sending future “reminders” of the “freestyling” times once the passenger has returned back into the corporate office – along with offers to book next years vacation
For example, a mobile campaign for Smirnoff vodka loads an application onto a user’s phone that guides them through how to include Smirnoff into a fun evening. Users can enter the social situation they find themselves in – a business dinner, night out with the guys, or first date –and receive suggestions as to what cocktail order would be most appropriate for the situation.
The application even takes advantage of cross-promotional opportunities, suggesting bars and restaurants that are strategic partners, located in cities around the world, so that a business traveler can find an appropriate place to go while in a strange city. And at the end of the night, the application will even call you a cab and give you directions back to your hotel.
Cruise 2.0 is linking cruisers to booking agents, travel discounters, reviews (by actual cruisers not professional critics) and self-created travel blogs. Where is it going?
The article “Understanding the Psyche of Tomorrow’s Travellers” states future cruisers “have grown up in an era where computers and rapid communication are the norm, where landline telephones are considered a waste of space as they live on their cell phones and communicate via texting…prospective college roommates have already checked each other out on social networking sites, where they have shared their most personal thoughts with the whole world.”
The trend is already picking up considerable momentum. A recent article from Theodore Koumelis “Web 2.0 playing big role in decision process” states “research conducted in August 2008 by Prophis Research with online US adults has shown that, when compared with a range of offline and online sources for travel decision-making, Internet sources are largely seen to be near the top of the list.”
I envision a cruise ship version of classmates.com. Select the line, ship and date. Proudly receive a “badge” (an electronic version of state stickers RV vacationers place on their vehicles). This automatically invites you to link to all others who were passengers on the same ship – opening communication channels to facilitate discussions, share photos, blogs, videos etc., Additionally, this would be a multilingual site (as another Koumelis article importantly points out) to facilitate the expansive international cruise and online growth.
The website would facilitate communication about:
who else was on your cruise ship at the same time as you?
what they thought of the experience, or what other cruises they would recommend?
where they booked their travel or what they paid for the same trip?
What they recommend for on-board and offshore activities?
Ever meet someone on-board you want to get into contact with but don’t know how to find them?
Yes, there are cruise groups on other sites, facebook, flickr, etc., and yes there are cruise review sites, CruiseCritic, Cruisemates.com etc., However, in the ever evolving world of the web there are always opportunities to bring the next viral application to the market.
I would like to hear you thoughts. Please post your opinion.
The chart to the left shows the percentage of cruisers who use the Internet to contact a travel agent. I saw Internet growth figures like these in the late 1990′s for usage of the Internet for news. Today the number is well past 70%.
Travel agents and cruise lines also need to avoid what airlines fell victim to: online searching for tickets helped to create a commodity like lowest price war. In fact, travelers already most frequently believe that the best prices can be found on the Internet (51%) and the assumption is even higher among non-cruiser vacationers (59%). Continued branding and building of distinctive ships and activities will be paramount to communicate it’s The Line you choose for the journey, not just a transportation vehicle to sample destinations you are likely to visit again. (Side note: 80% of cruisers agree that cruise vacations are a good way to sample destinations they may wish to visit again. Click here to learn more on topic.)
Since this online booking behavior is most typical with newer and younger cruisers (the contemporary segment) it represents tremendous opportunity for growth. While Travel – Ground/Cruise accounts for 6% of all web traffic, or 11 million unique visitors, the dominant share of online traffic between the big three Cruise Lines is still very much anybody’s game. See CruiseSearch for more. Whoever can do it best will capture a larger share of the online cruise booking market. The opportunity could be in integrating service functionality into the website – only 17% see websites and online travel retailers as providing the best service.
Here are some other Internet related cruise research facts:
When choosing vacations, cruisers are influenced by multiple sources, especially destination web sites (39%) and cruise websites (28%).
Cruisers plan trips well in advance (5.6 months) compared to non-cruisers (4.9 months) – giving them plenty of time and reasons to go online.
The map below illustrates where people searching online for cruise topics come from. It shows the truly international market of the cruise industry today. Within each geographic market resides its own set of opportunities and consumer dynamics.
The chart to the left shows the percentage of cruisers who use the Internet to contact a travel agent. I saw Internet growth figures like these in the late 1990′s for usage of the Internet for news. Today the number is well past 70%.
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