Online cruise sales set to soar just like online air and accommodation sales says Carl Frier

Issues & Trends – May 2013

Online cruise sales set to soar just like online air and
accommodation sales says Carl Frier

ONLINE cruise sellers will win a significant volume share of the Australian cruise market within three to five years, according to Cruise 1st general manager Carl Frier.

“And not just cruises – air and pre and post tours all packaged up,” he told delegates attend-ing this month’s Travelport Pacific Customer Conference at Uluru’s Ayers Rock Resort.

Cruise 1st, the UK-based online cruise retailer that has enjoyed considerable success in its home country, established an Australian office in 2010, spruiking its dynamic cruise packaging model.

The Australian company had access to a wide range of inventory through its UK parent.

Participating in a “Going Direct” panel discussion at the Travelport conference, Frier said latest statistics issued by Cruise Lines International Association (CLIA) Australasia showed strong organic growth in the Australian cruise market but, at this stage, very few retailers have an online proposition.

However he predicted that cruise sales over the web will burgeon in the same way as online sales of airline seats and hotel rooms have evolved over the past decade – “and I don’t think it will take that long; within three to five years online sales will have a significant volume share of the cruise market,” he said.

Cruise 1st operates a hybrid model in Australia and Frier revealed that only about 15 per cent of sales are currently achieved online (the balance coming via tele-sales or off the street). But he forecast that online sales will quickly grow to a point where they account for 60 per cent of sales.

In Australia, conventional wisdom has been that cruise sales involve more complexities than sales of airline seats and hotel rooms – particularly when they involve destinations such as Europe, Alaska and the Caribbean when they are usually sold in conjunction with other air and land content – and, therefore, don’t lend themselves to an online sales model.

However latest CLIA statistics show that relatively straightforward cruise sales – Australian coastal, trans-Tasman and South Pacific – account for the bulk of passengers in this market and these may be more vulnerable to inroads by online sellers.

In the UK, where online cruise sales currently hold a much larger share than in Australia, discounting is reportedly a considerably more significant market factor.

However the latest CLIA statistics show Australian cruise passenger numbers growing much faster than in the UK while cruise market penetration here has now gone past the UK’s.


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