Cruise News - CLIA and Cruise Inustry Growth
MARCH 16 - 2010 : CLIA (Cruise Lines International Association) HIGHLIGHTS THE REMARKABLE STORY OF
GROWTH & EVOLUTION OF CRUISE INDUSTRY
From 30,000-ton converted transatlantic steamers carrying a few hundred passengers to 225,000-ton vessels carrying 5,400 guests; from small inside cabins to exclusive duplex suites; from one or two main dining rooms to dozens of eclectic culinary venues, including celebrity chef signature restaurants; from shuffleboard and ping pong to wave riding, waterparks, rock climbing, bowling and ice skating; from tiny windowless gyms to 20,000-square foot luxury spas: Cruising is not what it used to be.
As Cruise Lines International Association (CLIA) celebrates its 35th anniversary as the industry's leading trade association this year, a spotlight is shining on a remarkable story of the impressive growth and evolution of the modern cruise industry.
Founded in 1975 just as a handful of passenger shipping companies were struggling to figure out how to survive, CLIA's history parallels, and helped shape, a dramatic transformation in cruising, cruise ships, consumer expectations for vacationing, and the travel agency distribution system. It is the story of extraordinary technological advancement, bold marketing innovations and steady success despite significant challenges and obstacles. Most of all, it is the story of visionaries who dared to think big and, as a result, created a uniquely new industry out of the reinvention of their own marginalized and obsolete businesses.
"Aside from computers and online technology perhaps, I don't know of an industry that evolved and transformed so profoundly and quickly as cruising. It would be hard to invent a story of such innovation and change," said Terry L. Dale, president and CEO of CLIA.
Today, CLIA's 25 member cruise lines, which represent approximately 97 percent of cruises sailed by North American's operate more than 200 ships of all sizes in every part of the world. At least 118 of the vessels have been built since 2000; virtually all the others have been continually refurbished and modernized. Together, they will carry over 14 million passengers in 2010 and have an economic impact on the United States alone of more than $40 billion, positively affecting all 50 states. In 2010, CLIA members will introduce 12 new ships ranging in capacity from 101 guests to 5,400 passengers, for a total investment of $6.5 billion. In all, 26 new vessels will enter the fleet between 2010 and 2012, representing an investment of nearly $15 billion and a net increase in capacity of 18 percent. But it was not always so.
In 1959, more travelers flew across the Atlantic Ocean than sailed on ocean liners, marking the quick demise of passenger shipping, the dominant means of travel that had thrived for centuries. By 1975, many shipping companies had begun experimenting with new ways to use ocean liners in order to stay in existence and newcomers, known as the South Florida "upstarts" had envisioned new concepts of vacationing at sea, first using existing ships and then quickly introducing new, purpose-built vessels imaginatively designed for leisure cruising.
The seeds of a new cruise industry had been sown and CLIA was formed from a number of previous trade organizations to bring the industry together and promote a new kind of vacation. Warren Titus, an industry legend and president of Royal Viking Line, one of the new luxury cruise companies that was founded in 1973, was named CLIA's first chairman. Remembering the time he said, "To the best of my knowledge it was the first time an industry like ours joined together and tried to work together in the interest of the whole."
From the beginning, CLIA has always been about nurturing, educating and preparing travel agents, through training and Certification, for competitive challenges, making profits and being ready to take on whatever the future may hold. In 1975, 74 percent of agent commissions came from air travel; today, earning a living from the airlines is virtually impossible. On the other hand, the cruise industry, from the beginning, recognized that travel agents represented the most effective sales force possible and made sure to win their loyalty. As Bob Kwortnik, CLIA's first director of training, put it, "We showed them how to make money" by selling what was, for many, an unknown product. Today, among CLIA's 16,000 agent members, those who have enrolled in training and Certification programs report an average increase in cruise sales of 261 percent. Cruise commissions in 2009 are estimated to have topped $2.5 billion.
The product agents were selling for the first time - the cruise industry - evolved quickly. In 1970, some 500,000 vacationers cruised. In 1977, Princess Cruises served as the setting for "The Love Boat," a TV series that, until 1986, came into the homes of millions every Saturday evening. By 1980, 1.4 million vacationers had joined "The Cruise Revolution," CLIA's marketing theme at the time, and the advent of convenient air-sea vacation programs provided new appeal. By 1990, CLIA member lines welcomed 3.6 million guests, and in 2010, 14.3 million are forecast to cruise, including 3.6 million from international markets, one of the industry's fastest growing segments. Since 1980, the number of cruise passengers on CLIA member lines has grown at an average annual rate of 7.4 percent, a remarkable accomplishment considering the period encompassed economic downturns, high interest rates, oil crises, wars, September 11and the current financial crisis.
As the number of passengers grew, the CLIA fleet not only grew but was transformed. Norwegian Caribbean Line and Royal Viking Line were among the companies introducing the first new ships built for cruising. In 1988, Royal Caribbean's revolutionary Sovereign of the Seas, with a nine-deck atrium, luxury spa, full-scale theater and other innovations, helped turn ships into authentic vacation destinations. In the 1990's a boom in new ships led to the first to top 100,000 tons - the Carnival Destiny. RCI's Oasis of the Seas, introduced in 2009, weighs in at over 225,000 GRT.
New technologies enabled not just larger ships but bold new concepts in facilities, resulting in today's CLIA fleet that features seagoing waterparks and full-scale luxury spas, often with their own private spa suite accommodations. There are shipboard bowling alleys and ice skating rinks. The largest ships offer several entire neighborhoods, each with its own theme or character, attractions and activities. Entertainment can feature world-acclaimed stars and groups, from Second City to Blue Man Group. In dining, the emphasis is on choice and flexibility, sometimes with a dozen or more options, and, increasingly, sophisticated and exciting enrichment programs are a regular feature of shipboard life.
Technology has also enabled the cruise industry to take a leadership position in finding solutions to environmental, health and safety issues. Rigorous recycling, energy conservation, ecological hull coatings, window tinting, propulsion and hull design, and partnerships with leading environmental organizations have helped create a new generation of increasingly "green" cruise ships.
Thirty-five years of innovations in ships and shipboard activities as well as the globalization of operations and itineraries and, most importantly, a continued commitment to provide the very best value across all price categories of cruising have helped to change consumer expectations, not only of cruising but of all vacationing. The popularity of international and multi-destination travel, interest in a variety of dining and entertainment experiences, demand for active and enriching vacations, and the insistence on quality and value are all expectations that modern cruising, by meeting them, can take pride in helping to nurture.
Essential to the cruise industry's growth was an evolving trade association. Throughout its history, CLIA has both spearheaded change and adapted to it. The first classroom training sessions of the 1970's have evolved into a comprehensive, multi-faceted training and Certification program featuring classroom, online, DVD/video, and textbook options as well as learning opportunities at CLIA events, other industry meetings and traveling seminars like Training Fest. In 2010, CLIA will present nearly 50,000 training events in over 150 cities across North America. Today, a record eleven thousand travel agents are currently enrolled in Certification programs pursuing their CLIA Certified Cruise Counsellor designations.
In 1991, CLIA launched its first National Cruise Vacation Month, followed later by World's Largest Cruise Night, two high visibility consumer promotions that continue to drive interest and awareness for the latest innovations in cruise vacations. The association's hugely popular annual conference and trade show, cruise3sixty, to be held this year in Vancouver, June 2-6, has set attendance records each of its five years of existence and provides incomparable opportunities for learning, networking and socializing with industry leaders and peers. The CLIA Hall of Fame, a centerpiece of cruise3sixty, was introduced to pay much deserved tribute to those individuals who have contributed the most to the industry. And, CLIA's Travel Agent Advisory Board is a further example of the priority the association places on its agency partnerships.
"The North American cruise industry and all its members can be very proud of their accomplishments," Dale concluded. "This is a truly amazing story and one that will continue to be even more exciting, thanks to continued innovation and strong industry partnerships."
For more information about CLIA, visit www.cruising.org.
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