Cunard cruiser mindset shift

Cunard is gearing itself towards a greater international market, with increasing numbers of Australian and Japanese passengers biting into the ever dominant UK market. In the past two years, the 176-year-old luxury cruise operator has witnessed a slide in the number of Brits stepping aboard Queen Mary 2, Queen Victoria and Queen Elizabeth – part of a strategy to “recognise global citizenship,” says Cunard International Development Director David Rousham. Speaking aboard Queen Victoria while docked in Sydney at the end of February, the London-based executive said he’d been brought into the company four years ago to drive international business for the brand. And the results are starting to show. “At that stage, around 55% of our business was Brits. That’s now about 50%,” adding that he’s still got “a little bit more to go” in terms of winding back the figure. “Our whole goal is about a blend of the international audience. I want the best international blend and we feel there are markets we can increase.” Bookings out of this region have steadily increased since 2012, with Australians now accounting for some 11% of all Cunard reservations (up from 7%), overtaking Germany to be the cruise line’s third largest source, and sitting behind the United States in second. Aussies are increasingly keen to experience the Cunard product on “loop cruises” – a shorter duration round-trip voyage from a hub such as Sydney – offered as part of Cunard’s World Cruise program. “Australians have been very strong in terms of supporting our world cruise over the 80 years we’ve been operating World Cruises. During that period, the Australian market has always supported our world cruise. But I think there has been a mindset shift in Australia because of the capacity that’s coming and homeporting out of Australia.”

Times are changing for Cunard. Guy Dundas investigates how the company is keeping ahead.

“That’s a really important change I’m seeing, in that there is an expectation of shorter cruises and that is something we can offer as part of a world cruise, in terms of coastal requirements.” On the 29 February 2016 voyage of Queen Victoria from Sydney to Kangaroo Island, there were 1,200 Australians on board the eight-day loop cruise. Rousham said he was hopeful the experience would prompt first time Cunard customers to book a future world cruise, Mediterranean, European or transatlantic sector. This year, Cunard has seen a 15% yearon-year growth for the Mediterranean, due in part to a drop in the number of Americans who, according to Rousham, have “switched off consideration” to the region in favour of Alaska or the Caribbean, due to geopolitical issues in the Eastern Mediterranean. “The Australian is sailing for a slightly shorter period [in Europe]. We have seven-, nine-, 10-, 12-, 14 and 21-night cruises and we are seeing more Australians cruising the shorter lengths this year.” Last year Cunard celebrated its 175th anniversary with seven specific celebratory voyages including a transatlantic replica cruise of the original Britannia voyage in July. Some 800 Aussies made the trip, a “phenomenal” result, Rousham said. What makes Cunard stand out from the pack in the luxury ocean-liner market is the proposition. Flagging “some big growth” in the small ship luxury sector, Rousham said Cunard’s proposition is making a statement. “We are not small. We are big or large ship luxury – that’s where we position ourselves. You can get all of the benefits of ultra luxury with Grills, but all the benefits of a big ship.” Other source markets which have shown growth for Cunard include Japan where there are currently around 5,000 bookings annually, and to a lesser extent China. “China is something we’re really interested in,” Rousham told travelbulletin, but admitted the region presents challenges. “Chinese culture and Japanese culture bring a certain demand on ships in terms of catering and language. And that can be quite challenging. “We want to make sure – and without sounding arrogant – it is an international experience or Cunard experience, so if we change it or localise for the sake of one particular group of people it will alienate another. We want to make sure it’s as standard as possible.” “You’ll see a lot of other cruise lines saying they are building a Chinese ship or a ship of a specific market. As soon as we do that we think we are alienating others, and we don’t want that. We are stepping slowly into the Asian market”. Another challenge Cunard is currently facing is yield on its Australian offering. Unfavourable exchange rates with the Australian dollar versus the pound have seen a 20% slump in yield in 2016. “We’ve got a challenge in Australia in terms of yields and in terms of how we commercially manage our business. Classically, foreign exchange rates and fluctuations over the course of a year does impact [Cunard] and that is something that has changed consistently over the last two years. “Our view is what goes up, will go down,” Rousham added.

I think there has been a mindset shift in Australia because of the capacity that’s coming and homeporting out of Australia’ David Rousam, International Development director, Cunard