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Diversification the key to China’s next decade of growth

L-R clockwise: SCAP panelists Sarina Bratton, Bert Hernandez, Cherry Wang and Helen Huang aired issues related to customer satisfaction, distribution channels and diversified products
After a decade of expotential expansion, internationally and locally-based cruise executives are calling for more practical actions to further boost and stabilize the growth of cruising in China.

Issues related to customer satisfaction, distribution channels, diversified products and other topics sparked the attention of leading executives from top brands at last week’s Seatrade Cruise Asia Pacific 2018, which took place in Baoshan, Shanghai.

‘The industry is becoming mature and in the coming five years we should be focusing on improving customer satisfaction levels,’ said Helen Huang, president Greater China, MSC Cruises.

‘According to Cherry Wang, vp and gm of Princess Cruises, China, ‘cruising boasts the highest customer satisfication across China’s tourism products.’

With the second largest cruise source market, ‘even more opportunities are coming to the China cruise market,’ predicted Kenneth Wong, GM, MICE and cruise, Hong Kong Tourism Board.

He and Jeff Bent, md Worldwide Cruise Terminals, cited recent infrastructure developments in China’s Bay Area are opening up huge potential for growing the China cruise market: ‘the Guangzhou-Shenzhen-Hong Kong high speed rail link which opened in September as suddenly put 270m people (previously 100m) within a four hour train ride of Hong Kong’s Kai Tak cruise terminal,’ noted Bent.

Diversifying products and services are considered to be one of the top priorities of cruise lines focusing on the local market.

‘The important things that need attention are diversifying the destinations on ex-China sailings and the product offering,’ said Bernie Ye, vp sales and commercial, Greater China & South East, Costa Group Asia.

Due to China’s geography and seasonality patterns, year-round cruising in China is not easily handled.

‘Hong Kong is definitely a seasonal cruise destination, while the major mainland cruise ports of Shanghai and Tianjin are not the best options for travellers during winter,’ commented Bert Hernandez, svp and coo, Royal Caribbean International, China.

MSC Cruises’ Huang agreed there might be challenges especially sailings from Tianjin in the winter season.

Broadening the distribution model is another top priority. Many executives called for more travel agents be given the right to sell cruise holidays. There are currently around 800 travel agents selling cruise a number which counted just ten a decade ago.

Cruise lines also requested to be allowed to make direct sales – including shore excursions and on-board packages.

Currently, the distribution channels for cruise sales in the first-tier cities is much better than the second and third-tier cities. ‘We should strengthen the training of travel agencies based in smaller cities, build up the online distribution platform and internet connections,’ suggested Cherry.

Huang agreed the need to better connect travel agents located in coastal cities with customers in inland cities.’

Wong suggested the need to not only focus on selling cruises based on ports of call but to also market according to the onboard offering and brand loyalty.’

Sarina Bratton, chairman Asia Pacific Ponant suggested ‘getting the consumer to better appreciate differentiation of product is crictial,’ adding, ‘there seems to be no brand loyalty in China. Currently, a lot of purchasing is being driven by price.’

Sales and marketing approaches are becoming more crucial for building the local source market and in particular the effective use of social media.

Brendan Tansey, md, Viking Cruises China advised the industry in China to make more of social media while Cherry believes, ‘face to face marketing events’ are working well for Princess to pass information to potential customers.

A sustainable development is important going forward: ‘introducing a new ship is always refreshing, but we need to achieve long-term brand recognition,’ Hernandez emphasized.


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