Cruise lines make money when every cabin is occupied. They still have a lot of work to do in order to fill their new ships with higher-spending passengers.
More Chinese vacationers are cruising than ever before. But the cruise industry still faces challenges, particularly in educating Chinese consumers about cruises and developing an efficient distribution network in China.
Carnival has reason to celebrate when passengers spend more, but cruise lines need to be careful not to undermine their value proposition by making travelers feel nickel-and-dimed.
If Carnival can not just fill boats but get more money out of each passenger it will have hit on something that's eluded the industry for the last few years.
As more ships compete for cruisers in China, it’s no surprise that prices are dropping. But as long as returns remain higher than the global average, expect operators to keep flooding the market.
25 Moments that Mattered in 2015: To make our selection of 25 moments, we thought back to the stories that drove reader engagement and sparked discussion among both travel experts and the general public. Some stories were quick blips that represented bigger things while others were narratives that built slowly through out the year. Each one, though, spoke to where we are right now when it comes to the big business of global travel.
When you operate enough ships to comprise half of the global cruise industry, it makes sense to leverage that scale to increase efficiency and savings. It's actually shocking that Carnival Corp. took so long to do so.
It was only a matter of time until Carnival Corp. introduced a brand to serve Chinese cruisers. With the imprimatur of the Chinese government and the backing of its massive sovereign wealth fund, Carnival now has a huge advantage over its competitors in Asia.
Chinese consumers want to cruise in Asia, and cruise lines are jockeying to meet the demand. If the Asia experiment doesn't work out, lines can send their ships back to high-demand regions like the Caribbean and Mediterranean.
Some lines call them service fees. Others call them gratuities. But one thing is for sure: cruise lines generate income by charging daily fees that aren't included in initial cruise fares. It's unclear whether the money is actually going to those who serve passengers, or represents a growing source of ancillary income to offset other costs. For now, we'll call this phenomenon hate sailing.