Given the current state of the economy, the best any travel executive can hope for when reporting on the outlook ahead is to have a few bright spots to sprinkle into the presentation to mitigate the bad news. Fortunately, Crystal Cruises’ executives had ample good news to share with top agents during its 18th Annual Sales Achievement Gala, held recently aboard the Crystal Serenity.
Left to right: Jay Johnson, Coastline Travel;
Phyllis Corliss, The Corliss Group;
Ann Van Leeuwen, Virtuoso;
Barbara Gilliam, Crystal Cruises;
and Hedwige Roessler, Crystal Cruises,
at a private evening concert in Ephesus, Turkey,
during Crystal’s Sales Achievement Gala
(c) Crystal Cruises
Oil prices and a decrease in revenue in the U.S. were the main concerns raised by executives, but these were more than offset by news of major product updates, strong international demand and the addition of unique, new destinations.
“[Last year] was far and away the best year ever in the company’s history,” said Gregg Michel, president of Crystal Cruises. “This year, we definitely have our challenges, and our revenue is down about 4 percent so far. It’s not terrible, but it’s not 2006 or 2007.”
According to Michel, oil prices are the biggest drag on the company right now. He said Crystal is projecting about $38 million spent on fuel in 2008 — 47 percent more than in 2007. He also said that while the line charges each passenger a fuel surcharge of $12 per day (instituted in June), the actual increase spent on fuel per passenger is closer to $22 per day, and that doesn’t account for exempt passengers who were already booked when the fuel surcharge went into effect.
“If oil prices level off, then eventually the fuel surcharge will mean we are at least collecting about half of what we’re actually spending,” Michel told TravelAge West. “The frightening aspect is if they don’t level off. Then I think you have to ask your passengers to share some of that.”
With concern about demand in the U.S. due to the weakened economy, the company has looked to the international market, which has grown substantially and still has plenty of potential according to Michel and Bill Smith, senior vice president of marketing and sales. Crystal said revenue from international markets is expected to be up 14 percent this year, and that’s following phenomenal growth in 2007 (31 percent).
“So, while we’re down overall, international [sales are] just grinding away,” said Michel. “And that’s really supplementing some of the sluggishness we’re seeing in the States.”
Even with the increased international business, the line has no intention of playing it safe or resting on its laurels. Smith says the line is well aware that its upscale, sophisticated passengers can be demanding, and the company intends to continue to invest and innovate. The biggest change will come in November when Crystal Serenity goes into a two-week dry dock in order to convert 12 category AA Deluxe Staterooms with verandas on Deck 10 into eight Penthouses — a move that was met with cheers by agents at the gala.
Other changes include a redesign and new construction in the Crystal Casino, and a redesign of the bar in the popular Crystal Cove. In addition, Nobu restaurant recently launched on the Crystal Symphony. (It was already on the Serenity.)
Another major announcement at the Gala, and one that had many agents buzzing, was the premiere of the 2010 World Cruise itinerary. The cruise features plenty of exotic ports in South America, Africa, India, the Maldives, the Black Sea and more, but the part of the itinerary that had everyone talking were the stops in the Middle East, including Iran, Saudi Arabia, Jordan, Kuwait, Bahrain and Dubai.
Besides the business updates and presentations, agents on the Eastern Mediterranean cruise (Athens to Rome) were also treated to plenty of perks. One of the most notable was a private evening concert at the Roman ruins at Ephesus in Turkey. As the sun set and the music of Haydn, Bach and Mozart filled the ancient
Roman amphitheater, all in attendance seemed to understand exactly why Crystal has been voted the top cruise line year after year. There’s little doubt that a downturn in the market is going to change that anytime soon.