The pandemic has sapped the energy of everyone. The recent arrival of the Omicron variant has not done the cruise industry any favours but it is clear that Celebrity Cruises’ president and CEO Lisa Lutoff-Perlo and her team have been using this unusual time to add quality and value to the luxury cruise line’s offering.
“We’ve always been in the heat of the moment and moving at 100 miles an hour, so when we had an opportunity to pause, we employed [former British Prime Minister] Winston Churchill’s comment ‘never let a good crisis go to waste’ in a positive way,” she says. “In my 37 years in this business we’ve never had time out like we did for Covid, so we decided to make the best of it.
“When Covid hit, we thought about the brand and decided we wanted a strong comeback. We wanted to use the pause in a proactive and productive way and shift our strategy ever so slightly to help the brand forward.”
One of the results was the Always Included offering, which is part of Celebrity’s new luxury positioning. It is about moving the brand into a space between premium and luxury. Research showed that guests would be prepared to pay for gratuities, drinks and wi-fi within the fare rather than as extras. Hence, it was decided that Always Included pricing would be offered with every cruise, creating simplicity so consumers better understand what they are booking, thereby making Celebrity more desirable for people looking for a more luxurious experience.
By all accounts it is working. “The team thought we would have 50 per cent of guests wanting Always Included pricing – and that was an optimistic prediction – but 85 per cent are going for it, even when we’re offering a cruise-only fare,” says Lutoff-Perlo. “I think we struck a chord that is meaningful to the consumer. We’ve attracted higher-end customers and moved into a new luxury space. Our new strategy and how we are positioning ourselves – with the retreat, pricing, Always Included – has really resonated with consumers and the industry.”
As people return to holiday mentality, it seems they are focusing on the type of accommodation they are purchasing, rather than Always Included, which is available with all categories. “What we’re finding is that because people have been cooped up for so long not doing anything, they have a different perspective on life and what they want to enjoy,” explains Lutoff-Perlo. People are really splurging on upper inventory. We are selling a higher percentage in The Retreat.”
The arrival of the third Edge-series ship, Celebrity Beyond, in April 2022 (several months after the original autumn 2021 launch date planned pre-pandemic) will further boost the brand’s offering. When Lutoff-Perlo first came to the brand in late 2014, she began working with Royal Caribbean Group’s executive vice president of maritime and newbuilding Harri Kulovaara on both the design and experiences for the Edge series. Way back then she could see from the general arrangement plans that there was an opportunity to make Celebrity Beyond longer and taller than her sister ships, Celebrity Apex and Celebrity Edge, and the decision was duly taken.
“This allowed us to do some amazing things with some of the most popular spaces,” she says. The Sunset Bar, for example, is now multi-terraced and layered on the back of ship and a two-level Retreat sun deck has been created. The rooftop garden has been expanded, as has the grill to create a full restaurant. There is a new speciality restaurant, Le Voyage by Daniel Boulud, a world-class bar, and a larger and more spacious Grand Plaza with a bar situated midway.
“Everyone is booking The Retreat. It is an extraordinary experience, the exclusivity is wonderful, but guests can still go to general public spaces,” says Lutoff-Perlo. “Bookings are going well generally, and the expectation is that they’ll be even better once Celebrity Beyond is introduced to the UK in April.”
Looking ahead, Lutoff-Perlo is still determining whether the trend for spending more on higher-end accommodation will continue, creating the need to expand Celebrity’s inventory. “Depending how this all goes and if perhaps we are building another class of ship, we could increase the number of staterooms in The Retreat, but no decisions have been made yet.”
When it comes to the here and now, Celebrity resumed operations in June 2021, putting eight ships into service in eight weeks, adding two more in December and one of the expedition vessels into Galapagos in January 2022. The hope is that the whole fleet will be back in service by the year end, but the changing nature of coronavirus and the most recent Omicron variant is keeping everyone on their toes.
Despite the US Centers for Disease Control & Protection making the conditional sail order (CSO) voluntary on 15 January 2022, Lutoff-Perlo says: “We have every intention to voluntarily follow all the protocols of the CSO. Much of what we do is above and beyond compliance. We don’t see this changing unless the whole thing changes and it [coronavirus] becomes part of our lives. The thing we have learnt most is to be flexible, agile and just go with it. We cannot control what is going on, but we can control how we handle it.”
Having sailed and visited several ships in the past months, Lutoff-Perlo is only too aware of how people are feeling about socialising and travelling. “I am nervous to go out too, particularly on a plane where you don’t know who you are sitting next to,” she admits. “I was on Celebrity Summit for the New Year and our crew was worried I would cancel because of Omicron, so they were very grateful that I showed up.
“When I was on the ship, I was not nervous at all; knowing the guests and crew were fully vaccinated and boosted meant I could finally relax and enjoy myself. It was a wonderful experience because I knew I was in the safest environment I could possibly be.”
Celebrity’s record of not yet having to cancel any cruises due to Covid-19 outbreaks since resuming operations is testament to the effectiveness of its health and safety measures. Although there have been some guest cases, these have been “very, very low” and the same can be said of the crew.
In total, 98 per cent of the crew members have said they want to return to the ships if they have not already done so. “Hand on heart, the best part of returning to service was bringing the crew back to work, which was very important to all of us,” says Lutoff-Perlo. “They suffered tremendously from not being able to make a living. Some had to do different things for a while.”
In terms of itineraries, some modifications have taken place, for example Grand Cayman shut down so an alternative had to be found in the Caribbean. However, Lutoff-Perlo says: “In Europe, we’re still visiting the ports we were visiting pre-pandemic. Generally, destinations were keen to see us as economies had suffered very badly in some places.”
With all three Edge ships and others sailing in Europe this summer, the hope is that for the first time in three years it will be a normal tourist season both there and, in the Caribbean, and Alaska.
Looking 12 months out, Lutoff-Perlo shares Celebrity’s priorities: “I think the next 12 months will be about getting our fleet back into operation, hoping our business normalises and working hard to set ourselves up for 2023-2024. There has been a bit of pushback because of Omicron, so we’re building back the demand and optimism for this industry and for the brand. Working with the marketing team in building up consumer confidence in our industry. We have taken quite a beating; I believe very unfairly in many cases. We are going to work hard to recover from all of it and I have no doubt that we will.”
This article was first published in the Spring/Summer 2022 issue of Cruise & Ferry Review. All information was correct at the time of printing, but may since have changed.
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