Meetings At Sea: Are You on Board?February 1, 2013

Catching a New Wave of Excitement for Cruise Meetings and Incentives By
February 1, 2013

Meetings At Sea: Are You on Board?

Catching a New Wave of Excitement for Cruise Meetings and Incentives
The new Carnival Breeze, shown here cruising in St. Thomas, features six- and eight-day Caribbean cruises out of Miami. Credit: Carnival Cruise Lines

The new Carnival Breeze, shown here cruising in St. Thomas, features six- and eight-day Caribbean cruises out of Miami. Credit: Carnival Cruise Lines

When it came to cruise ships as a venue for incentive programs and meetings, the potential was long acknowledged, but far from being maximized. The cruise lines seemed to settle on an industry-wide attitude of benign neglect towards this market, even as a loyal and steadily increasing (although still small) portion of incentive travel program managers and meeting planner professionals continued to select the cruise ship option.

In recent years, that attitude has notably changed. Cruise lines are now actively cultivating the meeting and incentive (M&I) market with new onboard amenities and services designed specifically for meetings and events. The proactive attitude towards planners is now undeniable among floating facilities.

The cruise line industry — both as a coalition of companies and individual providers — has increased its presence within the meetings industry in multiple ways, including increased exhibition at industry conventions. The latest generations of luxury liners and other vessels have been designed to include conference facilities and technological capabilities, making the Complete Meeting Package now available at sea more competitive with the traditional CMPs on land. Cruise lines have added scores of executives whose main duty is to target and accommodate planners, which includes not just sales and marketing but devising packages more conducive to the unique demands of the incentive and meeting industry.

“The industry is very interested in this segment, and I feel that in 2013 we will see continued growth in this segment of passengers,” says Christine Duffy, president of Cruise Lines International Association (CLIA). “New ships have been built with innovative audio-visual technology and meeting space capacity. The product lends itself to incentive and meeting travel.”

Growing Market

Although still a small percentage of overall cruise ship passengers, indications are that the numbers of M&I passengers onboard are growing. Few quantifiable figures on the market — either its size by number of M&I passengers or the dollars being generated by them — are currently available. Informal estimations from cruise lines indicate that between 5–10 percent of passengers currently fall into the M&I category. In truth, most cruise lines are only now adequately tracking these figures. Distinguishing different categories of group travel passengers — which some industry observers estimate to account for more than 25 percent of all cruise passengers — and clearly identifying who are incentive and meeting travelers remains a relatively new enterprise.

In 2010, a study by PhocusWright “Groups and Meetings: Driving Success in Business Travel’s Most Complex Segment,” for the first time queried planners about cruise ships as meeting venues. The report stated: “Six percent of meeting planners/overseers reported using a cruise ship as a meeting venue in 2009, versus 8 percent who planned to do so in 2010.” Although still single digits, this figure does show a year-to-year increase of nearly a third. The study surveyed 630 planners; it is unclear how indicative this sample size is of the meeting planner profession, which a 2011 PhocusWright study estimated to number 90,000.

Duffy came to CLIA last year, after serving as president and CEO of Maritz Travel, one of the world’s largest M&I travel management companies. She not only is optimistic about the untapped potential of the M&I market, she has the experience and motivation to lead the industry to better tap into that market.

Cruise Meetings Taskforce

In 2011, Duffy organized the Meeting, Event & Incentive Taskforce (ME&I Taskforce), made up of incentive specialists from CLIA member lines, with the specific mission of “building stronger relationships and partnerships with meeting and incentive industry leaders…develop and deliver education and research to raise the cruise industry’s visibility and overall profile in this market.”

During its inaugural year in 2012, the ME&I Taskforce partnered with Meeting Professionals International (MPI) Foun­dation, and hosted two focus groups with MPI corporate meeting professionals: one onboard the Celebrity Silhouette and another conducted at MPI’s 2012 World Education Conference (WEC).

The taskforce was a step in the right direction, but its initial accomplishment was finding out how much more there is to do in order for this segment to grow. “We had a lot of basic questions, like how do you book a cruise, and how is that different than booking a hotel. A lot of the planners were shocked about what is available; there were a lot of ah-ha moments.” Duffy adds, “We recognize the need to provide a lot more education for meetings and incentive professionals, who are booking groups, about the benefits of a cruise.”

M&I Hybrids

The overall trend in 2012 was that incentive travel grew faster and accounts for a larger percentage of passengers than pure meetings bookings. “Incentive travel by ship has grown,” says Shari Wallack, president of Plantation, FL-based Buy the Sea. “The ‘build it they will come’ adage applies. Years ago, the corporate decision-makers were not experienced cruisers. Today’s CEO is young, well-traveled and likely cruise-savvy. This decision-maker’s understanding of the industry is vastly different, and he or she is more open to a new experience.”

The dominant trend in the incentive market is to interweave meeting components into an incentive program, a kind of two-for-one hybrid that also creates more teambuilding, morale-boosting and even networking opportunities. “Cruising is becoming part of the rotation of more planners for incentive travel and a meeting program,” says Jo Kling, president of cruise specialist Landry & Kling and CEO of the cruise meeting resource “They are looking for something a little different. Programs can be customized to meet different needs of the planner, for whatever size group.”

As overlap continues to blur the lines dividing incentive and meetings — and planners of all variety of events continue to seek out innovative settings that will spur attendance — onboard meetings are gradually becoming more the rule than the exception. “Cruise meetings are getting more popular,” adds Kling. “But not in one specific segment as in the past when cruise venues were used mainly for incentive travel programs: Now it’s an ever widening variety of meetings or events.”

“Planners are now realizing that a cruise can support their new meetings needs, whether it is more a strict meeting or a meeting-incentive hybrid,” says Duffy. “The ships today have the meeting space, the technology, the Wi-Fi. People were assuming there was not enough variety, but the fact is that most corporate groups contain different demographics, and there are activities for people who are more sedentary to full-blown spas, fitness centers, rock climbing and a range of options.”

Cruising Covers All Clothier’s Bases

The potentially wide appeal of cruising is why Jonathan Kierman, senior director of store operations for Catherines Plus Sizes, has planned his programs exclusively with cruise ships for the last three of the past 15 years. “We have a very diverse work force in terms of age — we have baby boomers to Generation Y associates. “Finding an incentive that is attractive to all is a challenge. We have discovered that by offering a cruise, the options of what our associates would be interested in participating are tremendous and give us a broad base to work from.”

Like most incentive programs, a ship must accommodate meeting components for Kierman’s program. “We need a meeting room with AV capability for our ‘town hall meeting’ as well as an upscale venue for our awards ceremony.”
In addition to having the facility to accommodate meetings, cruise lines offer streamlined pricing, inclusive packages and other aspects that enhance the return on investment (ROI) of an event. Compared to other venues, Kierman calls cruising, “extremely affordable and in a lot of cases it is cheaper. Our intentions for 2013 are to keep our budget flat to 2012. It seems like there are more options today than four years ago when I first began exploring these options. I believe this is because of the economy and more venues looking to acquire corporate business.”

Unlike other destinations that Kierman has utilized, which include popular resorts and cities, he discovered that cruising offers a built-in motivation for the targeted employees, eventually optimizing ROI. “Achieving the status of President’s Club has its own inherent ROI, but over the last three years since we have changed our venue to a cruise, we have seen a much larger ROI and even more so, it has become a driver of our culture. The phrase ‘Are you on the boat?’ is alive in all of our stores and a big motivator for the teams.”

Value and Flexibility

Simplified pricing — as opposed to à la carte — is an in-demand contracting issue in an era of widespread belt-tightening and heightened emphasis on ROI. “Planners understand that (with cruises) there are so many more inclusions, and it becomes unnecessary to bring in décor, entertainment, AV, etc.,” says Wallack. “What they may not know is how much more flexible the cruise lines have become in terms of confirming exclusive group events, offering alternative restaurant dining buyouts, customizing group shore excursions, allowing complete takeover of the conference space.”

Cruise lines are now also able to handle the needs of large groups. “Some programs have gotten so large that only a mega ship can accommodate everyone at one time,” says Wallack. “If you look at Mexico and the Caribbean, there are only a handful of hotels that work for large groups needing over 1,000 rooms for example.”

Unlike what is often the case when an event grows, making vendor and venue negotiations more complex, cruising contracting can remain less costly and convoluted. “A cruise is generally less expensive and is by far more inclusive,” says Wallack. “One rate covers meals, entertainment, onboard activities, port charges, taxes and gratuities. There is one rate for inclusive liquor. Onboard credit can help a client handle spa treatments, shore excursions, alternative restaurant charges, etc. It is very simple.”
The cost differential between a land-based and sea-based M&I program is significant. “Costs can range from 15–40 percent less with a ship, but participants feel they’re getting more,” agrees Kling. “Planners save time and shrink budgets, because there’s no need to plan menus: Multicourse meals are provided in a lovely dining room where there’s no need to pay for centerpieces or lighting, or linens or AV equipment. It surprises us to see the many ‘gotcha items’ that planners have to try to negotiate from the resort fee to the Internet, AV services, charges to pick up packages shipped for your trade show, parking. Whereas there just aren’t that many negotiable items with the cruise structure.”

For Duffy, the ME&I Taskforce was only the beginning of conveying the value of cruising to the planner profession. “Planners aren’t aware of how an event can be customized on a ship, or the air-to-sea options available that make flying into one destination and out of another affordable, or that cruise lines can work with you on how close to the date you need to book. Planners assume their needs cannot be accommodated by a cruise, and the opposite is true.”

International Reach

International cruising options are a natural fit for companies that are expanding their global reach and international work forces. “We are seeing more globalization of companies, and cruise ships cater to that global market,” says Duffy. “You rarely see pure incentive programs, so as the popularity of meetings-incentives hybrids grows, more companies are running these programs around the world. The companies themselves are now global. The ships not only go around the world, they are able to accommodate all the language and food demands of international attendees and participants more easily than any other venues. As companies become more global, cruise ships as settings for events will grow.”

Cruise News

Celebrity Cruises. In 2012, Celebrity invested $140 million to update its four Millennium-class ships, adding several popular Solstice-class dining venues and other enhancements. In the summer of 2013, Celebrity Cruises will be offering its broadest lineup of modern luxury options in Europe, and bringing Solstice Class style to Alaska for the first time. The newly “Solsticized” ships will visit 25 countries from seven departure ports and a total of 88 destinations in Europe alone. Celebrity Solstice, the sleek, 2,850-passenger flagship of the Solstice Class fleet, will become the first of its class to offer Alaska excursions, joining Celebrity Century and Celebrity Millennium in pairing Celebrity’s signature cuisine, activities and service with the region’s breathtaking scenery. Rounding out Celebrity’s 2013 summer season will be the Celebrity Summit, which, in February 2012, became the third in Celebrity’s Millennium Class fleet to complete the brand’s noted Solsticizing initiative — for voyages to Bermuda, Canada and New England beginning in September. The intimate, 96-guest Celebrity Xpedition, ranked among the top small ships, will continue to offer experiences in the enchanting Galapagos Islands.

Carnival Cruise Lines. “At Carnival, we’ve seen an increase across the board with all types of meeting requests including small board meetings, corporate meetings of all sizes and those that actually have a large enough program to charter the entire ship,” says Ann Sedgwick, senior director, corporate and incentive sales. “We saw an increase with both meeting and incentive programs in 2012. We anticipate this trend to continue.”

The Carnival Breeze, which debuted late last year, is a 3,690-passenger, state-of-the-art ship featuring year-round six- and eight-day Caribbean cruises from Miami, becoming the largest Carnival ship ever based in South Florida. In addition to many popular features that debuted on Carnival Magic — including the Caribbean-inspired RedFrog Pub, Cucina del Capitano family-style Italian restaurant, and SportSquare outdoor recreation area — Carnival Breeze features the first Thrill Theater. Carnival Destiny will undergo a $155 million makeover incorporating all of the “Fun Ship 2.0” dining, bar and entertainment features, as well as adding 182 new cabins, new dining choices, a three-level Serenity adults-only retreat and a massive racing-themed water park. The ship will be renamed Carnival Sunshine following a 49-day dry dock this spring, then operate a summer schedule of Mediterranean voyages before repositioning to New Orleans on year-round Caribbean cruises in the fall.

Carnival Cruise Lines will expand capacity on the West Coast with the introduction of year-round three-day cruises to Ensenada, Mexico, and four-day cruises to Ensenada and Catalina Island on the 2,052-passenger Carnival Imagination from Long Beach, CA, beginning January 26, 2014. The move will bring the total number of Carnival ships operating from Long Beach to three.

Disney Cruise Line. The Disney Fantasy set sail last year, a sister ship to Disney Dream, and the fourth ship in the fleet. Among the ship’s new features are Europa, a nighttime entertainment district exclusively for the over-18 crowd; two Broadway-style shows; and AquaLab, a water play area. Both ships have 1,250 staterooms and suites with a 4,000-passenger capacity. The Disney Fantasy also features the 1,340-seat Walt Disney Theatre, the 399-seat Buena Vista Theatre, plus other venues for group events and a full-service onboard events team.

Royal Caribbean International. “We are seeing more and more meetings/conferences/leadership retreats being booked on Royal Caribbean due to the fact that we have dedicated conference center facilities on all 22 of our ships,” says Lori Cassidy, director, corporate, incentive and charter sales. “Our overall M&I booked business increased in 2012 over 2011. We anticipate additional growth in 2013.”

The state-of-the-art, 5,400-passenger Oasis-class vessels — Oasis of the Seas and Allure of the Seas — in the Royal Caribbean fleet offer meeting planners the most versatility available in the industry. Meeting facilities accommodate from 16 to 1,400 guests, and setups range from boardroom to classroom to theater to mini-trade show configurations. Four dedicated conference rooms can be configured to suit 18–330 attendees. Royal Caribbean invested $300 million to add popular Oasis-class features fleet-wide, including additional dining venues, more entertainment options, new staterooms and advanced onboard technology. By summer 2013, guests will have access to ultra-fast Internet, thanks to a new agreement with global satellite service provider O3b.

Royal Caribbean recently announced names and launch dates for their new Quantum class of ships: Quantum of the Seas will make its debut in 2014; and Anthem of the Seas in spring 2015.

Norwegian Cruise Line. “Based on the tremendous value that a cruise offers, we are definitely seeing an increase in interest from both corporate meeting planners and buyers,” says Camille Olivere, senior vice president of sales. “With the addition of Norwegian Epic to our fleet in 2010, we saw a definite increase as soon as the ship was launched.”
The Norwegian Breakaway, the newest ship in NCL’s fleet, debuts this spring in New York City and will feature an exciting fireworks show on every cruise, a grand finale to a 1980s-themed deck party. The 4,000-passenger ship will arrive in her year-round homeport of New York City on May 7 and begin weekly summer seven-day cruises to Bermuda on May 12, 2013. The vessel’s groundbreaking design features The Waterfront and 678 Ocean Place with shops along an oceanfront boardwalk and three decks of dining and entertainment. The top decks of Norwegian Breakaway will feature the first Aqua Park at sea, and a three-story sports complex with the largest ropes course at sea. C&IT

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