International Cruise Summit 2018

The eighth edition of the International Cruise Summit outshined previous editions, and confirmed the ICS as place to be every year on the business to business agenda of the cruise community.

Report published in the magazine CruisesNews 47 – December 2018

More information: www.internationalcruisesummit.com

Communicating effectively the opportunities and sustainibility of cruises, the rise of new shipowners, ships, unique passenger experiences and luxury were other key takeaways of the international cruise summit 2018.

The eighth edition of the International Cruise Summit, held on November 27 and 28 in Madrid, outshined previous editions, and confirmed the ICS as place to be every year on the discussions and the business to business agenda of the cruise community. A breaking record of more than 400 attendees gathered and learned about an industry which continues to grow, its opportunities and challenges along with the most relevant cruise industry community executives.

The Opening of ICS began by keynote address from Ornella Chacón, President of the Spanish Port Authority. Mrs. Chacón highlighted the Spanish Government investment on PRF´s and on the importance of the cruise industry for thousands of people working in Spanish ports. Opening ceremony was addressed by Isabel Pérez Sauquillo, Deputy Marketing Director of Spain´s Tourist Office Turespaña, Marta Blanco, Managing Director Madrid Regional Government, Ivan Gonzalez, Madrid City Council´s Tourist Office Manager and Cruises News Media Group CEO, Virginia Lopez.

In a strong speech focusing on opportunities and challenges facing the cruise industry over the coming five years, CLIA Europe´s and Carnival UK Chairman David Dingle firmly warned on strong and unnecessary fiscal policies in some destinations for the cruise industry, citing two recent examples where he believes a city, on one side, and a country on the other, are viewing passenger cruise vessel as ‘providers of an easy source of income for their city budgets.’

Dingle explained on his remarks: ‘Two weeks ago the city of Amsterdam decided to impose an €8 per head passenger tax on cruise ships staying in port 24 hours or less starting from 2019.’ He went on, ‘with its 125,000 transit passengers a year if you times that by €8 each that roughly will bring in €1m which happens to neatly fill a hole the city has in its budget.’ If ships were to stay longer than 24 hours then the new tax increases to €16 per passenger.

Gianluca Suprani, Head of global port development and shore activities at MSC Cruises, confirmed that his company has taken the decision to withdraw calling in Amsterdam next year and instead will place those planned overnight calls in Rotterdam.

‘Amsterdan took a decision, we took ours’ stated at his panel discussion.  ‘We decided to pull our capacity in 2019 and as a result Amsterdam city stands to lose between €50-100 per passenger contribution of potential spend,’ Suprani mentioned to the trade media attending the event.

On the other hand, in a new head to head interview session format with MedCruise president Airam Diaz Pastor, Michael McCarthy chair of Cruise Europe – of which Amsterdam is a member – called the CLIA Europe chairman’s remarks ‘unfortunate and unwarranted’.

The international reputation of the event contributed to enhancing the ICS into a field of constructive dialogue on opportunities and challenges among all the industry community players. The Summit also allowed cruise line executives from newly created brands and cruise line conglomerates to explain their capacity expansion plans for the next years

The opportunities and sustainability generated by cruise ships in destinations, the rise of new companies and brands, the new ships in order, the potential in customer experiences and luxury were also the key takeaways of this successful event owned by Cruise News Media Group.

Industry professionals concurred that communication between ports, destinations, port associations and cruise lines should be improved, as well as explaining to local communities and mainstream media the benefits of cruise tourism in terms of economic contribution, employment, and tourist development.

Virginia López, CEO of Cruises News Media Group, interviewed Manfredi Lefevbre d´Ovidio, Executive Chairman of Silversea Cruises, who declared his passion for Spain in particular. Lefebvre d´Ovidio added that he is seriously considering investing into the Spanish Tourist Industry after the sale of 66.6% of Silversea to Royal Caribbean International. Lefebrve d’Ovidio unveiled that “traveling to uncomfortable and unexplored places is nice, but traveling to uncomfortable places in a comfortable and luxurious way is priceless, it is where real luxury lies on.”

In a very instructive presentation, Esther Mallach, partner of the German environmental management company Arnecke Sibeth Dabelstein, explained how the cruise industry is far ahead and beyond environmental sustainable footprint compliance compared to other travel sectors. However, it is not communicated correctly, and much worse, the stereotype persists that cruises are large pollutants.

In its newly renovated program, and showcasing ICS compromise with CSR policies, the Summit put an interesting presentation for delegates of the NGO SOS Méditerranée. The NGO explained its humanitarian work and distress at sea in the Mediterranean waters.

The 8th edition of the International Cruise Summit has also stood out for the multitude of business to business opportunities generated.  Business delegates all over the world were able to interact with the speakers and panellists in a business environment where the networking opportunities improve year after year. 

Master ICS results
There were 10 very technical cruise trivia questions that were launched to the audience. A total of 273 participants took part of the Trivia contest through the Slido application. The winner was Lauren Bouchardie of Cruise Bordeaux and answered properly 6 out of 10 questions. The contest was very tied until the end and there were two other participants that answered properly 5 out of 10 questions.

OPENING SESSION OF THE INTERNATIONAL CRUISE SUMMIT 2018
• Iván González, Tourist Information Office Manager, Madrid City Council: Madrid represents the ideal city for congresses and B2B events. 

• Marta Blanco, General Manager of Tourism, Madrid´s Regional Government: Madrid wants to be a strategic partner in cruise tourism and part of potential itineraries, the city is competitive (state of the art infrastructure, cultural assets – world heritage and museums, nature, gastronomy). 

• Blanca Sauquillo, Marketing Deputy Director, Turespaña: Spain is the most competitive destination in terms of tourism. 3000 cruises in the high season in Spain – increasing. Spain is also the 4th source market in Europe but aims to grow higher. 

• Ornella Chacon, President of the Spanish Port Authority: Spain is a best practice case in modern PRF´s for the cruise industry. 25 new refurbishments executed in the ports of Spain this year. An addition 20 new infrastructure projects planned in the coming years. Ports of Spain is a team effort to improve and market the Spanish ports as an example of green and sustainable port infrastructure for cruise business.

INTERVIEW OF OUR GUEST OF HONOUR
Manfredi Lefebvre d’Ovidio, Executive Chairman of SILVERSEA CRUISES.
• Interviewed by Virginia Lopez, CEO CRUISES NEWS MEDIA GROUP.

Key takeaways – Silversea´s value proposal:

→ Chartering New Territories. Exploration is beautiful – exploration with comfort is even more beautiful. It is the background and the real value proposal for Silversea.
• Elegance is the opposite of ‘wow’.
• Realize that time is the most valuable – want experiences for that time.

→ Silversea´s – future.
• Silversea is a family company (gives tradition and culture) although it is sold to RCCL.
  – RCCL wants to maintain that family touch under Lefebvre d’Ovidio´s helm keeping his founder on board.
  – RCCL had a strong interest and lacked a high-end cruise brand.
• The industry is growing steadily and very fast. Every day a new competitor.
• Strategic plans to build more ships – we have only seen the tip of the iceberg for Silversea.
• His vision is to give the company prosperity beyond his existence.
• Spain is a possibility in many ways as a source and as an amazing destination for Silversea and the industry. 

→ The industry in the future.
• New players in the luxury market will have to earn financing without belonging to major cruise conglomerates.
• Luxury cruising in Europe still has a lot to give.
• The industry in 25 years: Hard to predict.
  – So much changed so rapidly in the last 10 years – except in mobility, but it will happen.
• Silversea´s founder is willing and interested to invest in other sectors of the travel industry. Spain is on his aim.
• Cruise industry´s magic: We produce the most important in life – experiences and memories with the loved ones. Not a product such as glasses or chairs. And passengers will remember much more from a week’s cruise than from 1 month in the office.

SESSION 1 – 2019 – SMOOTH SAILING OR MAKING WAVES IN THE INDUSTRY
• Moderator: Olga Piqueras, Managing Director INTERCRUISES SHORESIDE AND PORT SERVICES
Chris Theophilides, CEO CELESTYAL CRUISES
Massimo Brancaleoni, Senior VP World Wide Sales COSTA CRUISES
Douglas Prothero, CEO THE RITZ-CARLTON YACHT COLLECTION
Richard J. Vogel, President & CEO PULLMANTUR CRUISES
• Mario Ferreira, CEO MYSTIC INVEST
• Kevin Bubolz, Managing Director Europe NORWEGIAN CRUISE LINE
• Achille Staiano, Vice President Global Sales MSC CRUISES

→ Smooth sailing is positive. 

• The industry is making waves (growth).

→ All members of the panel are growing and explained their strategic and operational plans. Market Penetration low with a lot of opportunities.
• Market Penetrations is still very low.
• The cruise industry and the number of cruisers is tiny compared to the larger vacation industry.
• Number of all hotel rooms in LA, Orlando and Miami combined is still more than the total number of cruise cabins.
• Ship yards are at full capacity.
• Cruising still represents the best vacation value on a dollar for dollar basis and has a very high satisfaction rating and repeat rate, which is yet another reason why the industry is booming.

→ How to extend the golden Era.
• New orders: Supply driven industry. Capacity is driving the demand.
• Ensure value for money.
• Invest in marketing and communication of the product.
• If the cruise industry does not expand capacity, they will lose market share.
• The challenge is not to increase the source markets, it’s to handle the current growth in a sustainable way.
• Finding qualified staff and human capital is challenging. Cruise is often alienated with the local employment market. Huge variety of jobs on board and strong internal career development.
• Few (outside of the industry) know the real opportunity of cruise tourism and the cruise industry.
• Cruise lines encourage destinations to develop collaborative relationships, such as integrated supply chains, destination partnerships, cooperation with cruise lines, and knowledge sharing networks between all of the major actors in the region. 

→ Sustainability.
• Minimize impact of cruising in the environment and destinations.
• All cruise lines are investing in strong sustainable policies.
• Industry going beyond IMO and EU compliance of sustainable cruising – but needs to become better at communicating it and ensure that the sustainable management footprint continues at ports and destinations. Everyone is part of the sustainable value proposal.
• Examples of current efforts were given:
– Removal of single use plastic.
– Use of new and cleaner fuels.
– Air Emissions newest exhaust technologies.
– LNG Power newest ships coming in.
– Waste water discharges – investing more in full compliance with port policies and SECA´s.
– Environmental Media Tours were organized by CLIA onboard to see the efforts – great coverage success.
– Interaction with locals is key regarding sustainable cruising (paramount in expedition class destinations and for smaller expedition and luxury ships).
– Education and example onboard as a benchmark: Staff should be an example for passengers for sustainable tourism – keep the ship clean.
– Not only onboard – also ashore.
  – Environmentally friendly shore excursions.
• Big vessels and smaller vessels have different challenges in terms of sustainability.
– Waster water management is harder for smaller cruise vessels (must keep it on board).
– LNG Power stations supply difficult in some places of the world.
• Different approaches to marquee ports and small destinations.
– Divide the passengers, spread out passengers and economic benefit.
– Smaller vessels with less passengers have less impact and value the local connection – more local experience. 

SESSION 2 – CAN CRUISE LINES, PORTS, TERMINALS AND SERVICES KEEP UP WITH THE GROWTH OF THE INDUSTRY/VESSEL SIZE?
• Moderator: Alexander Napp, Managing Director PWL PORT SERVICES
Gianluca Suprani, Head of Global Port Development & Shore Activities MSC CRUISES
Hugues Lamy, Director Port Operations V.SHIPS LEISURE
Steven Young, VP Port & Shore Operations CARNIVAL UK
Tine Nathalie Oelmann, Director Destination Management & Operations TUI CRUISES
Ukko Metsola, Vice President Government Relations ROYAL CARIBBEAN CRUISES LTD

→ Cruise lines are taking berthing capacity into their own hands. 

→ Handling destinations with the increase capacity is challenging and requires flexible itineraries starting on all days as well as planning in advance with port and tourist local authorities.

→ The support of the local community and public bodies is paramount for cruise business. Being considered as ‘people friendly’ port city is one of the elements making a destination successful. 

→ Guides with language skills is a challenging.
• Reflects in a negative way on guest satisfaction ratios.
• Destinations must have guides suited for the cruise lines at ports.
• Audio guides in the local language could enhance the experience.
  – Still need a tourist guide to go with the grou, but could overcome language barriers.
  – Although it is not the preferred solution.

→ Challenges for cruise lines back in the past:
• Lack of understanding and interest for cruise tourism in the local authorities and local population.
  – Hard to find destinations to visit.
• Lack of port reception facilities in destinations.

→ Big vessels
• Big ships are a challenge for most ports at berth.
 – But the maximum capacity has not yet been reached.
  – Dimensions of vessels in the next 10 years are stabilized and will not go bigger in size.
  – Adequate Port Reception Facilities and modern and equipped terminals are critical for sustainable cruise tourism for both. 

→ The slow pace of land side development is a challenge.
• Currently passengers are satisfied with the port reception facilities for larger vessels.
• Ports with limited capacity: A need to maintain a dialogue with these destinations and port authorities to find good capacity management solutions.
• As cruise ships mainly arrive near or into urban agglomerations, a good relationship between the port and the local authorities, stakeholders and population is paramount.
• However, local opinion is not necessarily always on the side of the port in relation to its cruise business. The passenger experience is always. different from the inhabitant’s experience and local authorities might lack good understanding of the needs and added value of the cruise business.
• To face this reality, it is important to provide the local communi – ty and also the wider region with good and trustable information about the benefits and added value of cruise and ferry business. 

→ Berth booking.
• Cruise lines are not able to solve this internally – traditionally.
  – Anti-trust laws – companies are not allowed.
  – A collective issue – should be a collective solution.
• All ports should have a berthing transparent policy – what it is, is not up to the cruise brands.
• Ports where cruise lines find it hard to collaborate will receive less calls.
• Cruise lines need to receive information about the capacity on a port on a certain day.
• More information from the port in general.
• Cruise lines marketing departments need to inform their source markets about all the less known destinations out there.
• There is a need to bring new things to the destination product.
  – Larger demand for niche products and new destinations.
• Non-marquee ports need to invest in PRF´s but cruise lines must give guarantee of long term agreements.
• Cruise lines are always interested in long term agreement.
• The cruise industry needs to re-invent itself. We have been doing the same things over and over expecting different results.
• Passengers change, newer and younger 24/7 connected generations, new ways to communicate branding, but we still sell and run tours the same way.

SESSION 3 – THEMED CRUISES, SPECIAL EVENTS, ENTERTAINMENT AND FESTIVALS. HOW DO THEY IMPROVE SHIP OCCUPANCIES AND GUEST SATISFACTION, AND HOW CAN DESTINATIONS GET INVOLVED?
• Moderator: David Selby, Managing Director TRAVELYIELDS LTD.
Robin Deller, CEO IMAGINE CRUISING
Mike Hall, Head of Marketing CRUISE & MARITIME VOYAGES
Keith Blundell, Director BLUE CHIP TOURISM
Susannah Daley, Founder, CEO and Creative Director PEEL ENTERTAINMENT GROUP
Sacha Rougier, Managing Director CRUISE GATE HAMBURG

→ Most of themed cruising often takes place on board.
• On land everyone has access to amazing entertainment.

→ Themed cruising values:
• Providing an extraordinary cruising experience is paramount in a high repeat ratio industry.
• Brings people with common interests together.
  – Music, sport, tv programs, fashion, gastronomy, celebrities.
  – Often something which brings back memories.
• Themed cruisinf is a way to grow the market.
  – Attract people that has never been cruising but has a specific interest.
• Adding a theme to late season cruise will help to reach revenue and yield strategies.
• Can help certain cruises which can be hard to sell more attractive as onboard unique experiences.
• Can make a destination more attractive – if the destination can host / allow / is interested the travel agents / cruise lines will be loyal.
• Can make a cruise extra memorable experience.
• Destinations needs to introduce that special something – hard for travel agents and cruise lines to discover.
• Dialogue with destinations is key for excellent themed cruises. Preferably around 2 years in advance. 

→ How does Themed Cruising is successful?
• Keeping the itineraries short (less than a week).
• Preferably in shoulder seasons to avoid splitting the passengers who are for or against the theme.
  – Cruise lines need to understand that everyone booked the cruise due to the theme.
• Successful themed cruises sometimes include overnight stays.
• The cruise lines are the facilitators of the onboard themed cruise experience.
  – They can be inspired but are the once which will set things in motion.
  – Travel agents put together individual themed experiences including a cruise.
• CLIA has the platform to get the stakeholders together. 

→ The welcome on themed cruises.
• Cruise lines would like to see more of this.
 – Very important for the destination experience.
• Entertainment – expensive but would like to do more.
  – Use to paying a lot of money (locals expect too much money).
  – Use the destination and planners and bookers – draw on the local connections.
 – Would like to do more on board entertainment

PRESIDENT ON PRESIDENT
Airam Diaz Pastor, President MEDCRUISE
Michael McCarthy, President CRUISE EUROPE

→ Background stories of the two presidents.
• Family is the reason to get up in the morning.

→ Background of the two organizations.
• MedCruise was founded to create itineraries for the cruise lines (better and more revenue).
  – Understand the stakeholders and politics better.
• CruiseEurope was founded by ports in Europe that wanted to attract the cruise vessels to Europe from the Caribbean.
• Communication is key.
• Cruise lines only come for one day, but the associations are there every day to be advocates for cruise tourism.
• Public companies – need to justify investments to the local community. 

→ Collaboration between the two organizations.
• On the project called “Blue Ports”.
  – Register and improve port reception facilities (how much waste can they take) + friendly legislation to find financing of these facilities.
  – Very inconsistent regulations and legislation from port to port and country to country.
• Work together with other cruise associations and destinations to spread positive news about cruise.

→ Cruise Europe and MedCruise and their members are targeting sustainability.

→ Final comment:
• Everyone can be competitors, but as the industry is booming, it becomes important to find common ground and collaborate as much as possible. 

SESSION 4 – NAVIGATING INTO THE SPOTLIGHT- DIFFERENTIATORS WITHIN THE LUXURY MARKET
• Moderator: Liz Gammon, General Manager TVG TRAVEL
Alfredo Spadon, Managing Director Europe and Asia SILVERSEA CRUISES
Yiannis Vontas, Senior Partner – Executive V.P. Development & Marketing VARIETY CRUISES
Jannicke D. Rognstad, Vice President SEADREAM YACHT CLUB
Juan Rodero, CEO STAR CLASS
Zeljka Galik Cimic, Product Development Manager SCENIC OCEAN CRUISING
Carmen Morosan, Global Shore Excursions Manager INTERCRUISES SHORESIDE & PORT SERVICES

→ How to define luxury.
• Is it personal or global?
  – Individual for each passenger.
• Details are making the differences.
  – Going to tuff places in a comfortable way.
• It is about the experiences – the destinations – memorable-
  – Luxury is a feeling.
 – Luxury is time.

→ Are the many new builds in luxury segment flooding the market?
• More ships but also more people which can afford cruise and luxury cruise.
• Newer generations looking to explore unique territories and elegant experiences.

→ Shore excursions:
• Keep it simple.
• Create special events and unique moments.
• Special sights that are not commonly visited.
  – Pax are well travelled and most has already visiting the most common destinations.
• Prefer smaller means of transportation.
• Think outside of the box. 

→ Ports.
• Want to be away from the bigger vessels.
  – However, these ports are not always luxury-ready.
  – Ports need to be aware of this.
  – Think beyond berth facilities.
• How does a port prepare for a luxury call?
 – Wants to be in center – walking distance.
 – Nice surroundings – not industrial.
  – Preference to ports that are more suitable.
• Smaller vessels are not always a priority for the port – less GT less money.
  – Feel it is hard to get berthing space in the bigger ports?
• Would be willing to pay more for a more exclusive berthing and privacy and more customized services.
 – But it really must be special. 

→ Destinations.
• New and unexplored territories.
• Luxury lines are looking special and exclusive experiences.
• An opportunity for a port / destination.
  – But about more than the port – also about the destinations.
• “Educate” the passengers.

→ Dress code – flip-flops?
• Dress code on luxury vessels is becoming more informal.
  – But it can be too informal.
• Need to feel at home onboard the vessels.
• How to handle it is all about the crew management.
• Dressing up could be a selling point sometimes.

→ Digital Marketing.
• It is a priority for targeting first time cruisers.
  – Planting a seed and telling a story.
• Booking is either online or through a travel agent.
• Word-of-mouth is also important.

SESSION 5 – PASSENGER EXPERIENCE – WHAT DOES IT REALLY MEAN? WHAT IS ITS REAL IMPACT? AND HOW MUCH DO WE CARE?
• Moderator: Mark Robinson, Chief Commercial Officer GLOBAL PORTS HOLDING
James Langley, Director of Marine and Technical Operations SAGA CRUISES
Martin Lister, Head of Itinerary Planning & Dest. Experience FRED. OLSEN CRUISE LINES
Chris Coates, Group Commercial Director CRUISE & MARITIME VOYAGES
Ana Belén Fernández, Marketing Director PULLMANTUR CRUISES
Sander Groothuis, Director Maritime Operations THE RITZ-CARLTON YACHT COLLECTION

→ Cruise lines make money on:
• Ticket sales.
• Shore excursions.
• On board sales.

→ Passenger satisfaction:
• Passenger satisfaction is the best and cheapest marketing.
  – Therefore it is a focus.
  – Wants to exceed the expectations.
• Important to know your passengers – what do they want?
  – And not just during the cruise also before and after.
  – Customer journey and Experience.
  – Passenger surveys are an important tool. 

→ The destination experience is key:
• Passengers like to meet locals in the local environment.
• Advise to tourism boards.
  – Listen to the individual cruise lines.
  – They do not have the same needs.
  – When destinations are “selling” it would be better to listen to the cruise line – what do they want – and then tailor the answer.
• Support in increasing the destination experiences from the destinations?
  – The quality has improved – become more creative.
  – When ports promote themselves, they must remember the destination is part of the value proposal.
  – Important the easy access to the destination.

→ Independent guests and tourist information.
• Tend to be a little forgotten.
• Good to have an information point at the pier.
• Should the information not come from the cruise lines?
  – Destinations offer information but it is rarely picked up by the cruise lines.
  – Putting a few locals on board before arrival to provide service and information.
  – Too late to offer information – should be earlier – at booking ex.
  – Use technology for signage – changes according to the destinations.
• Cruise lines should not dis-courage passengers to go ashore.
  – “Nothing to do on a Sunday” is not the right message.
  – Provide suggestion.
  – Need shore ex managers that are very familiar with the destination.
• Cruise lines like to sell tours before departure.
  – Once on board they will inform about the destination.
• Cruise lines are generally interested in receiving information.
  – Digitally so it can be shared (videos is great).
  – Should be high quality.
  – But the destinations need to have in mind who they are approaching.
  – Know your audience.
  – Listen to their needs.
  – Cruise lines can also communicate their brand/needs more clearly.
  – Also wants to know about the region – not just the destination.
• Bring new people to the industry to become more innovative.

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