Posted By Cruise Market Watch ~ 21st June 2009
Oprah Winfrey is with her employees this week on a cruise. At the same time, she has become part of a marketing trend.
According to Jo Kling, Founder and President of Landry & Kling, Inc, a premier cruise event services company "We anticipate the number of corporate and incentive cruise programs and meetings at sea to triple."
And here at Cruise Market Watch, the trend is our friend.
How can one take advantage of a trend? It begins by identifying the market, then developing strategies to win it over.
How big is the market for corporate meetings and incentive travel? Annual estimates range from $175 billion to $40.3 billion. I prefer the Incentive Research Foundation's $77.8 billion. If cruise acquires 2% (roughly its same share of the overall world-wide travel market) it would represent $1.6 billion in revenue or about 6% of all cruise revenues.
How to Win them
As one can see from our chart below - providing superior meeting experiences aboard a cruise ship at a competitive price will lead over time to market share gain from the competition.
The cruise lines are doing their part by building conference facilities on ships to rival those in hotels. For example, Royal Caribbean's Freedom of the Seas boasts dedicated conference meeting space with breakout rooms and reception area accommodating up to 400 people. It also includes high-tech presentation rooms with color touch screens, wireless remote controls and teleconferencing equipment.
With the basic physical needs of corporate meetings taken care of, it is up to branding to communicate the message to corporate planners. The experience of a corporate meeting on a cruise is more exciting, motivating and rewarding. In addition, a cruise ship adds to employee camaraderie and bonding (ask Oprah).
Jo Kling and her team are going a step further. By understanding the habits of the target market they are re-engineering the group quote process online with a new venture called Seasite. Since nearly 80% of corporate meeting planners use the Internet for research, Seasite will for the first time consolidate cruise information online from strictly a meeting planners perspective. It also facilitates a single RFP and quicker quotes. The goal is to make the cruise booking experience equal to or better than the hotel experience. Speaking the customer's language is always good thing.
"At Seasite, we understand that cruising for many planners is virtually uncharted territory. Seasite demystifies the entire process by providing easy access, depth of knowledge and the tools and resources needed to successfully plan and execute corporate meetings" says Kling.
I like the strategy. The Seasite slogan "One-Third Land, Two-Thirds Meeting Space" successfully evokes the question in a corporate planners mind - why not at sea? And Seasite accomplishes this without going directly to price (maintaining the brand and margins) or using a picture of a cruise ship (we know what a ship looks like - create the desire by selling us on the emotion).
And price? According to Kling, the cruise lines can offer meetings for up to 40% less than traditional hotels. A study by TNS about non-cruise corporate meetings taken outside of North American by U.S. companies states costs typically run from $750 to $570 per person, per day and average 4 days in duration. This breaks out roughly as
- 30% airfare
- 20% lodging
- 20% activities/entertainment
- 15% food
- 15% ground travel
The competitive cruise pricing structure, favorable meeting facilities and overall cruise experience leaves plenty of opportunity to deliver on the promise - rich and rewarding meetings that motivate and inspire employees. This will help cruise lines continue growing market share.
For more on our "growing cruise markets" series see:
- Relax - cruise lines can go after the spa business
- Finding new passengers - keep the spa, toss the cruise
- Spa trends for the cruise market