Issues & Trends – Feb 2010
Agents crucial to Carnival’s ambitious Australian expansion plans
CARNIVAL Corporation has big plans for Australia, aiming to more than double passenger numbers from this country to 700,000 over the next decade. That will mean adding another four or five vessels to the fleet of P&O and Princess ships which Carnival already deploys in Australian waters. And it will mean working closely with travel agents through whom Carnival can gain access to holidaymakers who have not yet taken a cruise.
During a visit to Sydney late last month, Carnival UK chief executive David Dingle said the Australian cruise market remains virtually untapped and will be one of the next to take off.
Dingle, who is chairman of the Carnival Australia management com-mittee and oversees the Australian-New Zealand operation, said agents would play a crucial role in converting the vast majority of Australians who have never been on a cruise.
In the shorter term he is keen to see yields recover from the low levels reached last year after the global financial crisis spooked the industry and led to cruise lines dropping prices. Claiming Australia was not really “bitten by the recession”, Dingle said booking patterns had now normalised and the company was seeing much better fares coming through,
P&O heralded the New Year with a campaign promoting “Australia’s Biggest Cruise Sale” with savings of up to 50 per cent, but Dingle portrayed this as part of normal marketing strategy. “We always have a mix of discounts to yield manage,” he said.
Dingle said word-of-mouth is the single biggest influence for getting passengers on board, and well-trained agents and onboard service were the keys to getting the message out.
He said ship inspections are vital tools for training agents in cruise offerings, along with familiarisations like Pacific Jewel’s pre-launch cruise in December, and online training provided by the new P&O Academy.
Travel agents generate 90 per cent of Carnival Australia’s business, and Dingle expressed satisfaction with research showing 38 per cent more agents recommended Carnival ships to their clients, without being prompted, last year than in 2008.
Dingle said the additional four or five ships expected to join Carnival Australia’s domestically deployed fleet will mostly be P&O branded, with some extra Princess vessels. The company currently operates three P&O ships year-round (and will add Pacific Pearl in December) as well as two Princess ships on a seasonal basis.
Dingle said the extra capacity might include ships that are younger than the current fleet, and perhaps a new ship, although Australian business would have to be very strong to warrant a new vessel.
“Carnival wants to introduce two to three new ships a year (across all brands and all markets) in the next few years, and not five to six ships a year. Australian business has to put up a good case (to get one of the new ships),” he said.
Dingle is looking forward to an exciting year for Carnival Australia in 2010. Around 240,000 Australians and New Zealanders cruised on its locally-based ships in 2009 and the figure for 2010 is tipped to be 300,000, the increase to be driven by the Pacific Jewel.
Dingle predicted a further growth of 20 per cent for 2011 (to around 350,000 passengers), once Pacific Pearl comes on line.
But more ships mean more congestion on Sydney Harbour, a problem Dingle said Carnival Australia would have to face if it brought on bigger ships that couldn’t fit under the Harbour Bridge. The line will move from Wharf 8 Darling Harbour to the controversial White Bay terminal in 2012, which Dingle said the NSW Government had promised would be given a “make-over” with better roads and access.
Carnival will continue to move its P&O fleet around, basing ships in Brisbane and possibly Fremantle and will test out Newcastle this year with a short season beginning in September. Dingle said the company is unlikely to use Cairns, despite a new terminal to be opened this year, as the population is too small to support a home ported ship.
Carnival will also evaluate its decision to base Pacific Pearl in Auckland from December this year. “We shall see how New Zealand bites this opportunity to see if we’d base a ship there (permanently),” he said.
Dingle said Carnival Australia will also focus on ramping up business for the P&O World Cruises and Seabourn brands. He said Carnival UK was so successful selling three-month long cruises that it had not needed any sales support from Australia. Similarly Seabourn Cruises attracted big sales from Australia – between 3000 and 4000 passengers a year – with very little marketing.
“It is a market driven by word of mouth; we get that business with no effort and we know there is a lot more potential among the early retiring market,” said Dingle.
He sees the planned four-port visit by the new Seabourn Odyssey as an excellent platform to promote the Seabourn name. – Caroline Gladstone