The Cruise Industry Right Now
Written by: Paul Motter
An industry newsletter says the cruise business is reeling from the recent bad economic news.
Cruise Week, written by veteran cruise reporter Mike Driscoll, is a subscription-only newsletter delivered by email and targeted mostly to travel agents. Driscoll is reporting that the recent bad economic news has hit the cruise industry almost as badly as the sudden economic crisis of 2008 that resulted in the TARP bank bailout. http://www.cruise-week.com
The newsletter says “Several retailers report they are, in the past month, seeing the most severe dropoff in sales since the September 2008 timeframe. “Having said this, I think travel is still important to people, and there is business to be had,” says one retailer.”
If you have not noticed, the stock market has been tanking relentlessly, due to the failing economy of some countries in the European Union. Some cruise lines, like Royal Caribbean, get more than half of their income from non-dollar currencies.
Also contributing to the economic crisis is our national unemployment statistics which have not gotten better than 9% reported unemployment for over a year.
Cruise Week says cruise lines are currently offering discounts that rival some of the biggest agents have ever seen. One retailer noted there are so many discounts from different lines that they are cancelling each other out. One complaint is the complexity of the offers which may include onboard credit, lower deposits, discounts for second, third or fourth passengers, etc. They refer to it as the “fine print” syndrome.
The only good news is for the cruise consumer – that there are tons of cruise bargains out there right now. Of course, the cruise lines like to sell cruises as far in advance as possible and create incentives for people to book early. But right now we are in “Value Season,” the period between the start of school and the holiday season, when cruises sail with the lowest numbers of cruisers onboard. There should be some very good last minute cruise values out there right now.
In times like this the cruise lines generally hope and expect to fill the empty cabins still on sale for 2012. In bad economic times people book later, not because they are looking for last minute bargains, but because they need to feel confident about their personal “wealth index.” When the job market and the stock market are both suffering most feel they need to hold on to their rainy day fund rather than book a cruise.
A lot of agents in the newsletter blame Washington for not being able to solve the economic crises. Other agents cited the media as the villain, saying that while the economic news is bad the situation has not changed in the last few years and they don’t see the need for the constant drumbeat of “sensationalistic” bad news about the economy.
I personally agree with both accounts, but no matter who is to blame if you are lucky enough to be able to afford a cruise this is a very good time to book one.
Social Media and the Cruise Industry
Cruise Week addressed another area that many in the cruise industry have become involved with recently – social media. When I was at the Seatrade Cruise Industry Conference in 2010 many people were obsessed with Twitter and Facebook. Some of the cruise lines, especially NCL, were so committed to Twitter that they had some of their executives committing up to an hour a day to the site.
Now, some cruise sellers who say they made big financial commitments to social media found it was a big mistake. One tells of a $25,000 investment in a Facebook community for a special cruise which became a complete flop. The vast majority of people who had “friended” the cruise did not book the cruise, and in the end they had to “pull the plug” and cancel the whole thing.
I have personally said for years that social media is NOT the panacea many people believe. One word sums it up, MySpace. I have written editorials where I say that the problem with Twitter and Facebook is the actual identities of your “friends” or “followers.” In most cases they are your competition, or people who work with you but do not buy from you.
But lately I have noticed another very serious problem with social media. You know what happens when two people try to talk at the same time? You cannot understand either one of them. That is Twitter and Facebook. In the media it is called “noise.” There is absolutely no weight you can give any message no matter how important it is that is going to make it stand out in the mass of shouting and the deluge of self-promotion happening in those sites.
I personally find both Twitter and Facebook to be useless in terms of time management. Even my personal Facebook account is flooded with posts from people who seem to have absolutely nothing else to do all day long. What that tells me is that no matter what I say in a social media site, my message is going to get lost very quickly, and once it is gone no one is going to see it.
I think many retailers saw social media as a way towards “free advertising,” but as another agent says in Cruise Week, “I think [it] is a way to keep your name out there, but it is no way going to make a dent in regular advertising channels.”
You can subscribe to Cruise Week at the web site. http://www.cruise-week.com
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Posted: September 14th, 2011 under Paul Motter.