Cruise Adviser recently spent two nights on Royal Caribbean International‘s Harmony of the Seas, the largest cruise ship in the world. While on board, we spoke to Stuart Leven, the company’s managing director for the UK and Ireland, about the potential growth of the cruise market, building even bigger ships and when the UK gets a shiny new Royal Caribbean vessel.
Cruise Adviser: How does the UK cruise market increase?
Stuart Leven: There has been a really interesting dynamic recently: probably four in every ten customers we have from the UK will sail from the UK; but six out of ten will get a plane. You will always have ex-UK constraints because of the number of ships you can put in [UK ports], and there are only so many place you can go from in the UK. And wherever you go from, you have to transit, whether you’re going north or south. Our largest growth at the moment is people flying to the Mediterranean to start in Barcelona or Venice. [And because of that] I don’t see a capacity constraint. We’ve got 25 ships and 115,000 people on them every night – and we could have 115,000 of them Brits if we chose to. At the present moment, it’s about 15,000 Brits.
Stuart Leven and Michael Bayley, CEO, race down the Ultimate Abyss
With all the new product coming on – with Norwegian with Epic and Getaway, Britannia, Royal Princess, and us with Anthem of the Seas, and there’s more coming – it’s constantly in the news and it’s great for the industry. We are seeing growth in the industry globally – but cruise globally is just two per cent of the holiday market share. If we took that to 2.5 per cent, there wouldn’t be enough ships built in the next 10 years to hold that capacity, just to put it in context.
What role can the trade play?
They’re pivotal. The biggest challenge we face is convincing those who are indifferent to the idea of cruise to have a crack. There are 35million package holidays booked a year in the UK; there’s 1.7million cruises, a five per cent share. That means there are 95 per cent of people who are not yet considering cruise, but they are walking through the doors of travel agencies. We need travel agents to come on this ship, the world’s biggest floating showhome and, when people walk through their door, say: ‘Have you considered this? I’ve been on it and it’s great’. They have a massive role to play. Unlike some of of the other [cruise lines], travel agents are friends for life for Royal Caribbean, always have been, not just when it suits our business model. With many of the other cruise lines, it’s when it suits their business model. Most of them being friendly with the travel industry, three years ago they weren’t. We’ve always been friendly.
How are you pitching Harmony of the Seas?
We don’t sell cruises, we sell holidays. Harmony of the Seas brings two things together, which is great for new-to-cruise: a new ship and a short vacation, getting people to try cruise for the first time. People are probably a bit hesitant about [trying something different with] their two-week family holiday, which is so important to them. We always run shorts at the start and the end of the end of the season, often around half-term holidays. For instance, in October, Independence of the Seas will have a three-night, four-night cruise which will allow people to try it for £399, £499, bring the family on and see if they like cruise. Then we ask, have you thought about your summer holidays? That’s been very successful for us.
People often say, ‘Who would want to cruise on a ship this size?’ What do you say to that?
Well, we worked out the other day, we’ve had three million people cruise on our Oasis-class ships since we launched in 2008 and they are always full. I managed to sell this one out with the best part of 12,000 guests over two sailings in a week and a half. There’s your answer! People can say it’s too big, people don’t want it, but there are enough people who do. We don’t have to work hard to sell these ships.
Is Royal’s business model to keep building bigger and bigger ships?
We don’t know. One of the things that constrains you is the infrastructure, we had to build temporary infrastructure in Southampton just to bring Harmony of the Seas in. In Barcelona, we have to use terminals side by side, it’s so big. You have to look at that, but it will probably be driven by ideas: if we come up with another great feature and we need more space, we’ll build a bigger ship. That’s generally how we do it.
Can you tell us more about the Royal ship for the UK for market? Will it be an Oasis-class ship?
We will get a new ship for the UK. I probably wouldn’t bring an Oasis-class ship to the UK; Oasis isn’t as well suited as a Quantum-class or Freedom-class to do the trip around to the Mediterranean to start your cruise. There’s a lot of open space and if there weather is bad on the way around… It’s why the Quantum-class is beautiful designed, there’s a lot of outdoor space that can be covered up. It’s got to be the right ship for the right destination, so I don’t think I will push for an Oasis-class ship. We will have a Quantum-class ship back in the UK before long.