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Cruise Industry

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by

Justin Cunningham

on 21 April 2015

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Transcript of Cruise Industry

The average travel length in:
North American source market is -
7.3 days
Australian source market is -
8-14 days



Cruise Industry
Zaur Bayramov
Justin Cunningham
Mossa Haressy
Sean Jiang

CLIA’s cruise line members offer over 1,000 ports of call around the globe.
Total current cruise passengers in 2014 was at 22.1 million.
Market growth:
62% of passengers are now return cruisers, and 69% say a cruise is better value than a land-based holiday.
Ship size:
The focus is shifting towards design and amenities rather than scale.
Specialty cruises:
The category has grown by 21% between 2009 and 2014.
The Caribbean:
Which remains a popular spot for cruisers, accounting for a third of global deployment capacity market share.
New destinations:
Collectively, CLIA individuals now offer 1,000 ports of call globally.
Travel operators:
They remain a key point to booking a cruise, with 70% of cruisers utilizing one.
Travelers' necessities:
From better Wi-Fi to multi-generational advance, journey lines are progressively.

Current
23 Million cruise passengers volume expected, a 3.9% increase from 2014
Overall voyage industry is assessed at $39.6 billion, a expansion more than 2014
Cruise lines are scheduled to debut 22 new ocean, river and specialty ships, in addition to 421 ships
6 new ocean cruise liners and 16 new river cruise liners coming out bringing the total to 276 ocean and 167 river cruise ships
$4 Billion investment in new ships
20,000 total new berth beds in addition to 482,000 total beds
More demand for specialty cruises and larger ships
New ports and destinations requests
A new port in the Dominican Republic at Amber Cove is expected to open for Carnival Corporation. An original Jurassic Park movie was filmed near this port of call, making it a popular attraction.
New activities on-board and on-shore.
New markets and expansions.
2015 Future Performance
Africa
Nile River
Antarctica
Asia
Australia and New Zealand
Bahamas
Bermuda
Caribbean
Western
Eastern
Southern
Central and South America
Panama Canal
Europe
European Rivers
Northern
United Kingdom, Ireland, Scandinavia, Baltic States

Markets and Destinations
Average Cruiser
Middle East
Dubai
Mediterranean Europe
Eastern
Croatia, Greece, Israel, Italy, Turkey
Western
Italy, France. Monaco, Morocco, Spain
North America
United States
New England, Rivers, US Coasts, Gold Country
Canada
Mexico
The Pacific
Hawaii, Polynesia, Tahiti South Pacific
In 2014:
Average annual household income earned was
$114,000
.
Average age of cruise traveler was
49
.
Average length of cruise among travelers was
7.3 days
.
Average spent per cruiser was
$2,200
;
$1,735
for
fare
,
$565
for
on-board
and
$524
for
airfare
.
Cruising was ranked the
highest overall best vacation
and believed to be of
better value
over land-based vacations; as stated below:
The history of leisure cruising began with merchant ships, where these ships wanted to increase revenues by booking passengers aboard.
Cruising has become a major part of the travel and tourism industry that is continuously increasing.
The industry's rapid growth from 1900 to 2010 the cruise industry worldwide has an annual passenger compound annual growth rate of 6.55%.
The Cruise Industry
Four types of segments in
the cruise industry

Volume cruises or First class
$-$$
Premium cruises
$$-$$$
Luxury cruises
$$$-$$$$
Specialty cruises
$$$$-$$$$$
Cruise Segments
Revenue Management Strategies
North American market
(United States)
(leading passenger source market)
United States - 92%
Canada - 7 %
Rest of North America - 1%
Comparison of two source market
Itinerary planning
On-board Revenue
Shore Excursions
Tipping and service charges
Shipboard Revenue Drivers
Revenue and sales planning
By distribution channel
Source of customer market
Stateroom type/pricing and capacity management
Seasonality and repositioning cruises
Head Office Revenue Drivers
Company Performance
Pre-Cruise Packages
Land accommodation and transfer services, excursions) and post-cruise packages and land packages (transfer to airport, or accommodation, excursions)
Port Parking
Cruise Occupancy
Gambling
Casino
Bingo and games
Shore Excursions
Theaters
Art Auction Gallery
New Technology
Sky Diving, robotic bartenders and 360 degree view
Facility and Services
Medical
Business services (fax, email, print, internet connections, phone)
Laundry Facility
Personal Care Services (Spa, Hair and Nail Salon)
Children's area
Game room, activities and babysitting
Bars
Alcoholic beverages and soft drinks
Retail shops (duty-free)
Florist, sweet/gourmet, clothing, jewelry, liquor
Phot
ography
Weddings, special events and conference centers
extra tariff restaurants
Steakhouses and such, with a special famous chef, or special guest
Operational Performance
Performance Measurements
Available Passenger Cruise Days (APCD):
A capacity measurement based on double occupancy per cabin multiplied by the number of cruise days the period.
Berths:
Are beds on a ship based on double occupancy capacity per stateroom. Sometimes there are single occupancy per stateroom and can also accommodate three or more passengers.
Capacity Days:
The available berths multiplied by the number of cruise days for the period.
Gross Yield:
Is the Total Revenue Per Capacity Day or ACPD.
Net Per Diem:

Is the Net Revenue per Passenger Cruise Day.
Occupancy Percent (Load Factor):

A production compared to capacity measurement that is the ratio of Passenger Cruise Days to Capacity Days. If percentage excess 100%, that means there were three or more passengers occupied to a stateroom. An increase in occupancy rates is positive for the company, as it results in higher revenue for a marginally higher cost and thereby improves margins.
Passenger Cruise Days:
The number of passenger carried for a period multiplied by the number of days in their respective cruises.
Revenue per Available Passenger Cruise Days (RevAPCD):
A measurement of net yield based on the number of berth beds multiplied by the number of operating days for the season period.
Revenue per Available Room (RevPAR):

Similar to the measurement found in hotels, but is based on their staterooms to have a clear understanding in the cruise revenue management system. RevPAR is measured in terms of double occupancy per stateroom.
One of the largest voyage organization in the industry with representation in locations such as North America, South America, Europe, Asia and Australasia.
CLIA in North America is comprised of 63 cruise lines and 13,500 travel agencies representing more than 50,000 individual travel agents.
Helps promote and develop the cruise industry to both travel agents and consumers.
Helps travel agent and agencies sell the highest level of professional sales training and marketing support
Monitor and participate actively in the development of domestic and international maritime policies and regulations.
Actively protect the marine environment with minimal impact on the ocean, marine life and destinations.
Cruise Line International Association (CLIA)
A cruise is stress free, and hassle free vacation.
It provides new experience.
Cruise facilitate and networking.
Provides overview of historical and new experiences from port to another.
Why people cruise?
Australian market
(fastest growing market)
North American Passenger Market
Australian Passenger Market
Comparison
Australian Market
U.S. Market
Comparison
Additional statistics
Under 40 (27.5 % of cruisers)
41-45 (10.4 % of cruisers)
46-50 (8 % of cruisers)
51-55 (9.2 % of cruisers)
56-60 (10.4 % of cruisers)
61-65 (11.0 % of cruisers)
66-70 (10.3 % of cruisers)
Over 70 (13.2% of cruisers)
25-29 (8% of cruisers)
30-39 (23% of cruisers)
40-49 (17% of cruisers)
50-59 (24% of cruisers)
60-74 (24% of cruisers)
75 (4% of cruisers)
South Pacific (39.7 %)
Australia (17.8 %)
New Zealand (11.9 %)
Mediterranean (6.9 %)
Northern Europe (2.4 %)
Asia (5.3 %)
Alaska (2.9 %)
Caribbean & Eastern Mexico (32 %)
Bahamas (20 %)
Alaska (20 %)
Hawaii (16 %)
European Destinations (12 %)
1 to 3 months prior to departure
Booked - 34 %
4 to 6 months prior to departure
Planned - 38 %
Booked - 37 %
1 to 2 years prior to departure
Planned and Booked - 4 %
1 to 3 months prior to departure
Planned & Booked - 18.5 %
3 to 6 months prior to departure
Planned & Booked - 28.6 %
6 to 12 months prior to departure
Planned & Booked - 43.1 %
1 year prior - Booked - 9.8 %
The Main Destinations
Booking Patterns
Age Distribution
Full transcript