This year’s Wave Season is nowhere near a tsunami, but neither
is it a complete washout.
“Around here, we’re referring to it as the ripple,” said Lisa
Bauer, senior vice president of sales for Royal Caribbean Cruises
Throughout the industry, cruise lines are reporting decent
sales, but nothing like the huge wave of bookings that is
traditionally seen during the first quarter of the year.
“Bookings are coming in, but at a less predictable pace and not
at the usual velocity,” said Bradley S. Ball, director of public
relations for Silversea Cruises. “But it hasn’t been a total
What’s to blame? Obviously, there’s uncertainty about a war with
Iraq, the threat of terrorism and the sluggish U.S. economy.
The Orange Outcome
Bauer recalls the day the security alert was raised to the
orange level by U.S. Secretary of Homeland Security Tom Ridge.
“We were having really strong booking levels that Monday and
Tuesday,” Bauer said. “On Wednesday, when Tom Ridge took the
warning to orange, it was almost like someone disconnected the
Ball agreed. “It depends on daily events,” he said. “People are
tuned in to the radio and TV, and if it’s a good news day and looks
like things will be resolved, we get bookings. If it’s a bad news
day, everything seems to slow down.”
The bookings that are still coming in are often for close-in
“We’ve definitely seen a major shift in business to within 90
days of departure,” Bauer said. “A good 10 to 15 percent of our
business is for within 90 days; that’s more than we’ve historically
While that’s been the case for most cruise lines, ever since
Sept. 11, Bauer thinks that there’s more to blame now.
“I don’t think it’s related to Sept. 11 anymore because we’ve
had such a strong recovery,” she said. “Consumers think, firstly,
if they wait until it’s closer in, they’ll get a better deal; and
secondly, there are overall concerns around what’s happening with
the war and economy in general.”
“We started out really strong and Norwalk (virus) certainly
didn’t do the industry any favors. But just as we were coming out
of that, we went to orange.”
A Good Beginning
Patrick Clark, vice president of sales for Uniworld, a Los
Angeles-based river-cruise specialist, said that while booking
patterns for river companies are slightly different from big cruise
lines, the quarter got off to a good start.
“It started out strong and even today, we’re still ahead of last
year,” he said. “Russia is booming and China still looks strong,
despite the recent things going on with North Korea. And Europe is
up, but not a lot. It was up a lot earlier, but over the last
month, with all the talk incessantly on TV and in print, it caused
people to hesitate.”
Uniworld responded with its cancellation plan that allows
clients to back out of a trip, for any reason, without major
Cancellation Plan Works
“It has had the desired effect,” Clark said. “We’ve had hundreds
of passengers book, as a result of that. And it’s really helped us
in these last weeks, as the rhetoric heats up, and is
psychologically working on people and the economy.”
Interestingly, Uniworld is seeing some bookings for departures
in the late summer, the fall and the winter.
“There’s been so much publicized about the timetable and the
unlikelihood that it would go beyond March for any kind of land
conflict,” Clark said. “Those that have some nervousness don’t want
to go in the spring, but they’ll go in the summer or fall.”
Apparently, the conditions in Iraq and the Middle East would
become too windy and sand-blown for U.S. troops after March.
“Some people think if it’s going to happen, it’ll be in the next
month or so, or it’s not going to happen,” Clark said. “Or it’ll
happen much later.” Clark also said that some clients feel safer
cruising in small river boats of 100 or fewer passengers, which
dock in small cities.
“It’s not the same as a big cruise ship, pulling into a
high-profile port,” he said.
Bauer, however, said RCCL plans on keeping three Royal Caribbean
International and Celebrity ships in Europe this summer, whatever
happens in the Middle East.
“Europe has been holding its own in the past seven to 10 days,
but we’ve seen that slow down a little bit,” she said on Feb. 25.
“The trade is a little concerned that ships will be pulled.”
Princess Cruises pulled the Grand Princess from its previously
scheduled Mediterranean season to keep it in the Caribbean.
“We’ve made the decision the ships should stay in Europe, even
when we do go to war,” Bauer said. “Our financial analysis shows
that we will still do better in Europe than to move them and not
have ample time to market and sell them.”
Scandinavia is ‘Cool’
Silversea reports that its summer Baltic cruises, with visits to
St. Petersburg, are doing especially well. St. Petersburg is
celebrating its 300th anniversary this summer, and Scandinavia is
also perceived as a safe region, Ball said.
“In people’s minds and reality, it’s a safe, secure place with
no anti-American sentiment,” he said. “It’s cool to go to
Scandinavia now and it’s attracting a younger demographic.”
Bauer said that Alaska is booking well, which is often perceived
as a safe destination, along with the Caribbean, which is doing OK
but not great, she said. The challenge in the Caribbean is the
heavy concentration of capacity with the familiar result of
“Unfortunately, there’s not enough demand. So, everyone is
lowering prices, which we don’t agree with,” Bauer said. “We have
such high conversion rates, that we don’t believe price is the
issue. It’s a demand issue.”
While Royal Caribbean hasn’t followed Uniworld with the
cancellation incentive, Bauer said that it has increased its
marketing, both to consumers and travel agents.
“We have pages and pages of initiatives,” she said. “We’re
expanding our seminars-at-sea, we’re partnering on cruise nights,
we’re at all the various trade shows, we’ve increased our co-op
spending, and our sales people are everywhere working with the
In a nutshell, advertising and marketing should increase in
challenging times a theory to which travel agents should also
“We believe that in times like this, we have to be more
aggressive with our sales and marketing,” Bauer said. “Don’t
retreat. Get out and market as much as you can.”