Cruise Tourism: An Emerging Billion-Dollar

Growth of Global Cruise 

 

The global cruise industry has witnessed tremendous growth over the past few decades. According to the latest data from the Cruise Lines International Association (CLIA), 30 million passengers took a cruise in 2019, generating over $150 billion in economic impact. This marks an over 7% annual growth rate compared to numbers from 2009 when the industry carried 17.8 million passengers. North America remains the largest cruise market, accounting for over 60% of global passengers. However, Asia and Europe are emerging as high-growth regions for cruise lines with double-digit annual increases in passenger numbers from countries like China, India and Germany. The Caribbean remains the most popular cruise destination thanks to its beaches, duty-free shopping and ease of access from the United States. However, cruise lines are diversifying their itineraries to attract new customer segments with destinations like Alaska, Northern Europe, Australia and South America gaining popularity.

Rise of Megaships
Cruise Tourism is the most prominent trends has been the rapid increase in cruise ship passenger capacities. Legacy cruise lines like Carnival, Royal Caribbean and Norwegian have invested billions of dollars to roll out new ‘megaships’ that can carry over 5,000 passengers. These floating resorts offer cutting-edge amenities like waterparks, rock-climbing walls, Broadway-caliber shows and restaurants by celebrity chefs. Their economies of scale allow cruise lines to pass on lower pricing to customers. Popular new ships include Symphony of the Seas (Royal Caribbean), Harmony of the Seas (Royal Caribbean) and Mardi Gras (Carnival Cruise Line). However, industry experts are cautiously watching how these supersized vessels impact ports and the environment through higher waste and energy consumption.

New Customer Segments Targeted
In order to sustain its growth momentum, the cruise industry is vigorously targeting new customer groups beyond the traditional retiree segment. Family cruises with dedicated kids’ facilities and programming have become a major focus as baby boomers take their children and grandchildren along on vacations. Cruise lines have also launched new itinerary types, ships and branding to appeal to Millennials and Generation Z travelers who want unique experiences over all-inclusive resorts. ”Adult-only” and LGBT-friendly cruise options allow niche demographics to take cruises tailored to their needs. Industry leaders are also placing bigger bets on exotic emerging destinations like Cuba, Vietnam and Antarctica that appeal to intrepid travelers seeking off-the-beaten-path experiences. Companies like Viking River Cruises have found success with cruises focused on specific regions like Europe and Africa.

Continued Fleet Expansion
Thanks to sustained profits despite economic downturns, major cruise companies continue expanding their ship fleets with new orders and deliveries scheduled over the next decade. Royal Caribbean Group alone has 10 new ships slated to debut between 2022-2025. This fleet expansion will not just add more berths but also introduce innovative new classes of ships. For example, Celebrity Cruises is launching a series of “Edge” class vessels with floating cabin architecture and wellness features. Upcoming ships from MSC Cruises will run on cleaner-burning liquified natural gas. Others like Norwegian Cruise Line are expanding into premium and luxury segments hitherto dominated by lines like Regent Seven Seas Cruises and Seabourn Cruise Line. The influx of multi-billion dollar cruise ships plying the seas will help sustain the industry’s growth targets of 40 million passengers by 2029.

Adapting to COVID-19 Challenges
However, the COVID-19 pandemic brought the cruise industry to a virtual standstill in 2020 with ships idled worldwide due to bans on passenger ships. Companies lost billions of dollars in cancelled bookings and new ship deliveries were delayed by construction stoppages. To gain permission to resume cruise operations in 2021, lines had to implement strict public health protocols including vaccine/testing requirements for all passengers and crew. Even with these measures, Canada and parts of Europe maintained cruise bans longer than the U.S. While cruising has mostly recovered this year, future pandemic resurgences remain a risk if they disrupt tourism again or force new ship quarantines. Going forward, cruise lines will have to balance their growth plans with strategies for responding nimbly to public health disruptions and maintaining consumer confidence in the safety of cruising.

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About Author:

Money Singh is a seasoned content writer with over four years of experience in the market research sector. Her expertise spans various industries, including food and beverages, biotechnology, chemical and materials, defense and aerospace, consumer goods, etc. (https://www.linkedin.com/in/money-singh-590844163)