By
Rebecca Gibson |
This year’s spring emergence of the new Quantum class is obviously a major preoccupation and one that Goldstein is happy to be able to talk about at last. “It was two and a half years between the time that we started talking about doing something and the time that we could really say anything meaningful publicly,” he recalls. “There was an extraordinarily intense undertaking in the company to create a new class of ship that was going to move the brand forward in a really good way. That was a very significant stage, and very private. I’m very proud of my team again, as I was with Oasis of the Seas, that nothing leaked out. That’s pretty remarkable in this day and age with so many people involved in such a big project.”
He admits that the prospect of presenting Quantum was a tougher call than for previous ship classes due to market developments in this sector. “Our competitors have raised their game over the last few years, building better ships and doing better reveals of them. We wanted to be sure that what we did for Quantum topped everything.” He thinks the efforts succeeded. “The video we made really is a piece of Hollywood inspired wizardry, to make a ship that doesn’t exist yet look that real.”
This was where the company’s long experience came into its own, in his view. “We are very fortunate to have people with great longevity here who have done not only two or three classes of ship, but six, seven or eight over the course of twenty five years.”
This year, generating revenue in what remains a very competitive business environment is the biggest challenge, says Goldstein. Clearly, the enhanced entertainment options, facilities and activities on the Quantum class ships can be expected to drive revenue for the company – so does this mean more activities with a price tag? “Whether it’s the tickets or whether it’s onboard, people are going to pay if they see value,” says Goldstein. “Any aspirations that we have for onboard revenue emanate from the idea that we can create a value proposition that people are willing to pay for above and beyond the ticket price.”
It’s about getting the balance right, he explains. “If you take something like the sky diving simulation experience from RipCord by iFLY, or the North Star, which are two of the most important features in Quantum of the Seas, we need to have great value on the ticket price, while also offering options over and above the basic experience included in it. For example, if two people from a group want to have an hour with the instructors to themselves, then they’re going to pay. We expect that the overall balance of free opportunities and charge opportunities will create the perception of enormous value.”
He anticpate that the business outlook will remain demanding in the medium term. “My expectation is that the market will continue to be challenging, even if it will be improving from the recessionary environment of 2008-2010,” he says. “We are really trying to make our mark as a brand in many countries around the world, creating a preference for our product and competing with land-based vacations. Even within the cruise category it’s very competitive.”
Customer loyalty is a theme that Goldstein returns to frequently and with it, the line’s Crown and Anchor Society loyalty club. “It’s tremendously important that we retain the loyalty of our customers. We have tiered the programme to give ever-increasing value and have expanded a number of tiers so that the ability to ascend is more within reach than it used to be. Through our revitalisation programme and the new ships, we are in the process of creating diamond lounges in addition to our concierge lounges across the entire fleet.”
The sheer number of loyalty card holders is impressive: “We take about 3.5 million customers a year on our ships. About a third of them are members of the Crown and Anchor Society, so it’s a really big deal for us. We have a very valuable guest database and we are always trying to evolve so that we can get the right people at the right times and bring them back to us when it’s right for them.”
With the advent of social media, the centrality of the website and more sophisticated one-to-one marketing strategies, Goldstein says there is a completely different level of interaction with Royal Caribbean customers today than there was ten years ago. Booking patterns, too, have evolved. Where people live relative to the cruise departure point has a close correlation with how far ahead they book a cruise, he says.
This is an abridged version of an article that appeared in the Autumn/Winter 2013 edition of International Cruise & Ferry Review. To read the full article, you can subscribe to the magazine in printed or digital formats.