Cruising Industry Dynamics
There are many shifts within the cruising industry, some massive and some slight, that have and will continue to affect both the business and operations of cruising companies. These dynamics directly and indirectly affect the IT operations supporting cruising companies.
Since the early 90s, the cruising industry has experienced steady and continuous growth in both revenues and the number of passengers.
Between 2008 and 2014, US cruise travel outpaced general leisure travel by 22%, with a total economic impact of $120B just in 2014.
From 2000 to 2020, the number of passengers is projected to more than quadruple to over 25 million passengers annually.
In line with this, the revenue growth has kept a steady pace, to $40 billion annually in 2015, despite a dip after the 2008 financial crash.
Mergers and Acquisitions
The general hospitality industry has experienced extensive consolidation recently, and cruise companies have equally participated with several mergers over the last few years.
Mergers and acquisitions have a direct impact on IT operations as all the back-end systems need to consolidate, and in some cases, the consolidation extends to front-end customer facing systems.
With consolidation, companies will also need to become more efficient, competitive, and generally offer more variety of options to passengers, resulting in direct and indirect impact on IT operations.
As river cruising gains more traction among travel options, it will not be surprising for the industry to witness strategic acquisitions of river cruising companies, further fueling the need for business consolidation.
Shift in passenger demographics
While the majority of cruise ship passengers continue to comprise of middle-aged and elderly travelers, cruises are becoming increasingly popular among younger travelers. This will have an impact on all touch points and aspects of running a cruising company over time: targeting a tech-savvy customer base, providing for flexible itineraries, multi-generational product offering, and more ship-side and port-side options.
With the growth of middle class population in China, as well as a variety of cruise travel offerings internationally, cruise travel has shown significant growth internationally, specifically in Asia and Australia.
This will not only require cruising companies to provide culturally customized packages, but in all touch points from marketing to sales, and on-boarding, cruise companies will need to offer systems that customize to a variety of languages.