Posts Tagged ‘Allure’

Cruise Ship Segmentation

Segmentation is happening all around us every day; SUV or economy? Soda or energy drink? VP or Junior Analyst?  Cruise ships are no different – they each have distinct characteristics which we mentally place into groups (large and small, luxury and well, yes cheap).  But what happens if we let the numbers speak for themselves?   Cruise Market Watch developed a statistical model based on similarities within three dimensions:

  • ~ average duration of cruise
  • ~ average price per person per day (weighted across all cabin categories)
  • ~ ship passenger capacity

From 221 different cruise ships accounting for over 9,000 sailings in the next 12 months, our model produced 10 distinctive cruise ship segments.

Each segment describes, based on the data provided, the “class” to which its members belong (naming the segments is, however, more art than science). Segment members are mathematically most similar to each other along the three dimensions, and most dissimilar to members of the other groups.

Interact with the graph below by clicking segment selector and discover each segment’s averages and ship members.  And yes, Oasis and Allure really are in a class all by themselves.  The math is un-biased, so don’t hate.


Will Royal Caribbean’s earnings be an Oasis?

Royal Caribbean Cruises Ltd. (NYSE: RCL) is scheduled to release the company's fourth quarter financial results this week on Thursday, January 27, 2011.  This provides us an opportunity to compare "mega" ships current pricing (per person, inside cabin).

In the graph below one can see the average inside cabin asking price (during August to December 2010) for various sailing departure dates.  The Allure and Oasis have mirrored each other fairly closely, topping out at just over $1,400 per person.  Other than Allure's inaugural sailings, you will pay roughly the same for either Royal Caribbean ship.

Interestingly, Norwegian's Epic has maintained higher pricing than Carnival's Dream.  The premium paid to sail Royal Caribbean mega ships diminishes during September to November 2011 (particularly compared the Epic) only to increase again in the later part of the year.  Albeit, one can currently book a cruise aboard the Allure or Oasis during January to March 2012 for about 11% less than January to March 2011.  The bottom line, Royal Caribbean managed to unleash two of cruising's greatest buzz-worthy ships when it went super-sized.  If RCL can to continue to retain higher asking prices, larger margins and economies of scale from those investments will reward investors.

Royal Caribbean's earnings call will be available on-line at the company's investor relations web site,

Our proprietary database tracks daily ticket prices and passenger sailings to port destinations from nearly 8,000 annual cruises.  With an exclusive window into virtually every sailing, every day, world wide (including Carnival Cruise Lines (CCL), Royal Caribbean Cruises Lines (RCL) and Norwegian Cruise Lines (NCL)) our subscribers can view cruise revenue and passenger trends in near real time.