As we are all aware, the cruise line industry has been struggling recently. Between ships capsizing and passengers being stranded for days with no food or running water, the cruise industry has taken a huge hit. Recently, however, one European line has come up with a strategy to pique customers’ interests again.
After the 32 deaths that resulted from the Costa Concordia tragedy, European operations managers have been seeking to regain their client’s trust. Since these recent mishaps have taken place, passenger growth rates have decreased by 4, 9, and 18 percent in Germany, Italy, and Spain, respectively. TUI Cruises (which operates between TUI in Europe and Royal Caribbean in Miami) had an operations loss of $14.2 million as of March 31. Cost cuts have been implemented which could include dropping at least one of its five ships if things do not begin to improve.
In an attempt to broaden their client basis, Europe’s $48 billion industry has begun offering cruises targeted at special interest groups, ranging from nudists to food junkies. Among these new cruises is the Full Metal Cruise, on the luxury cruise liner Mein Schiff. This line features heavy metal bands on board including full-fledged mosh pits, rock concerts, on board tattoo artists, and after-hours heavy metal karaoke. German heavy metal band, Kreator, was among some 20 other bands booked by TUI. Almost 2,000 fans booked this rock n’ roll cruise, with most of them being first time cruisers, says company spokeswoman, Godja Soennichsen. The goal of this cruise was not only to generate income to make up for the recent loss, but also to gain publicity and counter the negative press. Managers also wanted to reach a demographic that may have previously never considered a cruise.
Overall, the strategy has been successful. The rock n’ roll themed cruise sold out, with the average passenger age being 39- which is significantly younger than the typical European cruise demographic of 45-65. The ships port, Germany, was also the fastest-growing market in Europe for 2011, providing desirable vacation-goers, because they spend more money on board than any other Europeans. Beer consumption on the metal cruise was also up from the average cruise, at 16 liters per person. This is six times more than your typical cruise.
The bottom line is that for whatever reason, the cruise industry seemed to be reaching the decline point in its product life cycle. However, through the use of differentiation as a product strategy, companies such as TUI have been able to counteract this decline and may be at the beginning of another growth stage.
Do you think that this strategy to gain new customers is one that will last over time or is it just a quick fix for a dying industry?
Is there a special type of cruise that you would like to go on or a certain special interest group that you think should be targeted for these types of cruises?