Spending spike on cruises outpaces other luxury sectors

'It's a great time to be the [luxury cruise] space,' Regent CEO Jason Montague told Signature Travel Network's Owners' Meeting 'It's a great time to be the [luxury cruise] space,' Regent CEO Jason Montague told Signature Travel Network's Owners' Meeting FILE PHOTO: Anne Kalosh

Spending on luxury cruises ballooned 14% in 2017, the highest increase among eight categories of luxury goods, including cars, fine wines and spirits, fine food, personal goods, hospitality, designer furniture and fine art.

Just a sliver of luxury hospitality spending

Yet the total spending for luxury cruises is just a 1% sliver of the luxury hospitality industry.

So said Jason Montague, president and CEO of Regent Seven Seas Cruises, citing a Bain Capital study in his address to the Signature Travel Network's Owners Meeting on Thursday.

'It's a great time to be the [luxury cruise] space, Montague told the audience, which includes some of the top retailers in cruising, gathered this week at the Ritz-Carlton Amelia Island.

Regent will grow its capacity 28% with the addition of Seven Seas Splendor in 2020.

Boomers have the bucks

As for the target market, 'There's a lot of talk about millennials. They're cute,' Montague quipped. 'The reality is: the wealth is with the baby boomers, and they have the time to travel.'

Far outpacing all other generations, boomers currently control a 50% share of net household wealth, which will decline just five points by 2030, when Gen X will have a 31% share and millennials, 16% (a big increase from their current single-digit share).

Plus, the age 55-plus market currently has the highest consumer confidence in years, Montague said, so 'it's a fantastic time to be focusing on baby boomers.'

Moreover, there's a societal shift from desiring possessions to placing a higher value on experiences. 'We benefit from this secular shift,' the Regent chief added.

Posted 06 September 2018

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Anne Kalosh

Editor, Seatrade Cruise News & Senior Associate Editor Seatrade Cruise Review