Royal Caribbean now has the largest capacity fleet in Southeast Asia. Managing Director Sean Treacy tells Peter Lynch of the challenges and opportunities this represents
What do you see as the best prospects for growing the Southeast Asian cruise market in the next 12 months?
The region’s cruise market should be experiencing a growth milestone in the upcoming year, with more new ships featuring more exciting amenities entering the scene. This will surely boost the market’s interest in cruising, while bringing more choices for consumers to book and for agents to sell.
The new ships may come in larger sizes, like the 4,905-guest Ovation of the Seas which is an almost 30% increase in capacity from the current largest ones here. And cruise lines like Royal Caribbean International will be embarking on longer seasons in Southeast Asia – which translates to more sailings, hence growth in the cruise market.
What do you see as the challenges – and what can be done to overcome them?
We need to grow the distribution network and educate the travel agents faster than ever, especially with all the new cruise hardware coming up in Southeast Asia and other parts of the world.
There are still many agents out there who are unfamiliar with the cruise product, on how to sell it or even the benefits of selling it.
Our company has been actively promoting our products to the travel agent community and training them on product knowledge through workshops and familiarisation tours and sailings, and will continue to do so.
At the same time, the slow development of adequate cruise port and tourism infrastructure in the region – especially for larger ships – still needs to be addressed urgently.
The industry needs to work closely together to engage the various authorities in the region on this issue, in order to develop more attractive and feasible cruise itineraries and grow the market.
RCL operates the biggest ships and the largest fleet – it has already invested in new destinations like Vietnam. Is more investment planned to improve port infrastructure? And if so, where do you see most development?
On top of Chan May Port last year, we also continue to look for other ports-of-call that we can develop or enhance around the ASEAN region to order to accommodate our larger ships, which is crucial for itinerary and product development.
Other areas that need urgent development in the region are cruise terminals with adequate facilities and sufficient berths, more tourism attractions nearer to the ports and better road infrastructure and transport availability around the ports to accommodate ships of any size.
Ovation of the Seas is described as a “game changer”. Will it change Asia’s view of the cruise industry? And if so, how?
As Asia’s largest and smartest cruise ship, Ovation of the Seas is creating a new wave of excitement for cruising and changing people’s mindset about this vacation option wherever she goes. Her next-generation cruise experiences onboard – skydiving and surfing simulators, elevated glass capsule, robotic bartenders, bumper cars, Xbox, Jamie’s Italian restaurant and the fastest internet at sea for instance – appeal strongly to guests of all ages especially the adventurous and sporty kind.
With the arrival of this ship, cruising is no longer seen as typically for just seniors or families with young children. It has widened its audience to more effectively capture the wired generation, the teens and young adults as well.
Are you planning any further changes to the Royal Caribbean fleet in S E Asia?
We are lining up three of Asia’s largest ships in Southeast Asia from this October, namely Ovation of the Seas, Mariner of the Seas and Voyager of the Seas, for a longest-ever season here.
How is Royal Caribbean setting about educating potential passengers in new markets? And what are the main means of reaching potential Asian cruiser passengers?
Through marketing and PR campaigns, media stories, speaking at consumer seminars and partnering with travel agents. In our new markets such as Vietnam in the recent years we are seeing significant growth thanks to our very proactive travel agents who have put in a lot of effort to promote our cruises through advertising and media collaboration.
We are also working with various tourism boards and agents in promoting cruises at national or regional travel fairs. The Singapore Tourism Board is an example of proactive collaboration with industry players like us in promoting cruises through advertising, publicity and travel fairs for instance.
What are the main differences in demand from Asian cruise passengers to others around the world?
Many of our Asian cruise guests tend to travel in multigenerational families. We observe that there are usually more groups than FITs in the newer markets and customers tend to book late compared to Europeans and Americans.
How important are travel agents to Royal Caribbean’s success in the region?
A strong distribution network is essential to our business growth and agents play an important role in multiplying and diversifying our touchpoints with our customers while value-adding to our products in their individual sales and marketing efforts. To us, they are not only our most valuable channels but also our most passionate ambassadors in representing and promoting Royal Caribbean. While aiming to grow our network, we are looking at more agencies which can work in tandem with us across all our markets in the region in the years to come.
Is Royal Caribbean carrying out special agent training across the region? Can you tell us what it entails and what incentives are available?
We have an online training platform, Cruising for Excellence, where our agents can engage in. Moreover, we conduct regular sales calls and visits to our travel partners that include training sessions.
How do commissions and other incentives compare to land and air travel for agencies in Southeast Asia?
Cruise commissions are competitive compared to land or air travel’s. Moreover for land travel bookings whereby travel agents still have to be heavily involved in the operational co-ordination and arrangements, cruise companies like ours have an added advantage as we take up the operational part of the work. In short, it is basically hassle free when agents book a cruise with us.
What would your best sales tip be to a travel agent trying to convert clients to cruise products in Southeast Asia?
– Great value proposition with virtually everything included in the fare
– Convenient getaway, unpacking only once on a trip to multiple destinations
– In particular for Royal Caribbean International, wide array of unique, exciting onboard entertainment and activities for guests of all ages, with the cruise ship as a true destination on its own.
Some suggest that creating new itineraries is an essential to create variety in the short cruise offering. Is Royal Caribbean working to increase diversity? And what areas do you see as having the best potential?
We’d love to add more ports in Malaysia, Thailand and Indonesia when the infrastructure is ready some day. At the same time, Royal Caribbean is also deploying new ships with more sailings to the region to offer more choices to customers starting from next year.
Is making the ship the destination – with vessels like Ovation – one answer?
Ships and destinations go hand-in-hand to make a truly meaningful cruise vacation. With two Quantum Class ships including Ovation of the Seas and two Voyager Class ships plying Asia, we have the best hardware in the region to create the most memorable vacation experience for our guests. When the market grows, there is always a possibility of bringing in other ships.
Do you forsee more “Asianisation” of cruise ships, with increased food offerings and entertainment geared to the Asian market?
Based on guest feedback, right now our guests in Southeast Asia are largely comfortable with our balance of international and Asian offerings onboard our ships, which is our way of distinguishing our brand.
The short cruise itineraries are appealing to young adults, but also inhibit growth. Is this something Royal Caribbean is working on?
We are beginning to see changes in vacation pattern in our markets ever since we have brought in the larger ships starting with the 15-deck Voyager Class ships and afterwards, the 18-deck Quantum Class ships. As the ship size increases, so do the variety of offerings onboard. Consumers are beginning to realise that the very short cruises of 2 or even 3 nights are not quite enough for an in-depth cruise experience and now appreciate more the longer sailings of 4 nights and more.
How does Royal Caribbean view the long term prospects for cruise in the Southeast Asia?
Highly positive with an enormous population with a growing middle class and a growing appetite for cruising as a novel way of vacation. The low penetration rate for cruising in the market also underlies its great potential for growth, with the right products, consumer education and travel agent distribution.