Interview: Daniela Wagner
Has demand for niche cruises increased since you started?
There has been a huge increase in supply and demand. Lots of traditional cruise line passengers are evolving towards small ships. People choose large ships because of the ship, but with small ships it’s the destination. They go on a European river cruise because they want to see the highlights of the Rhine or the Danube. When we started, few clients and agents knew much about niche cruising, but demand has increased hugely, as we expected. We work closely with Ace and the Passenger Shipping Association (PSA) to educate agents. I’m the chairman of the river cruise section of the PSA and it’s the fastest-growing part. A lot of the training centres on explaining the difference between the large and small ship experience focusing on intimacy, the ability of small ships to get into small harbours and the ease of getting on and off with fewer passengers.
Can agents who sell large ships easily switch to sell?
We are working with agents who traditionally only sold large ships and who didn’t think they knew enough to sell smaller ships. With commission structures changing among main cruise lines and so much discounting, a lot of agents who originally sold more than 90% mainstream cruise now want to diversify their businesses to increase margins and profitability. Agents are becoming more comfortable selling this product, luxury tour operators are including it in their programmes and consumers are keen because they see TV documentaries about experiences such as polar cruising.
What’s hot right now?
The Brahmaputra River in India got its first five-star ship this year. Asia is the fastest-growing place for small-ship cruising. The Mekong is the hottest river in the world and Irrawaddy River in Burma is big too. Orient-Express will have a new ship there? in May. India will become the next place.
Why should agents with affluent clients work with you? We are Atol and Abta registered and we work with a lot of suppliers who have between one and three ships in far-flung places across the globe that not every agent will want to deal with directly. Also, we are objective because we don’t own any ships and will always recommend the right product for an agent’s client. Our call centre knows every product and keeps up to date with new ships. And agents can get lots of helpful information through our website, mini brochures, training courses, webinars, trade shows and workshops Anybody selling safari lodges or five-star hotels should consider it. Agents want unusual and experiential product for their clients and we offer that. We have evolved a portfolio of five-star products with about 10 suppliers, from barges owned by Orient-Express in France to the Mekong Prestige and the Royal Crown in Europe. But there are also unique experiences that aren’t five-star but would interest affluent clients, such as the Alta in the Galapagos. We do cruise-only or can put together packages if the agent prefers. More than 70% of our work is business-to-business and we like it that way. That’s why we’ve joined the Aspire board – to build new relationships with the trade.
You also represent Compagnie du Ponant on the Aspire board – do agents know enough about them?
The company has just started dipping its toe in the UK market but it wants to really establish itself over the next two years. The product and size of ship is comparable with Silversea and SeaDream but the itineraries are different. Ponant owns four super-yachts. Three are identical, purpose-built luxury icebreakers rather than many expedition ships that are upgraded to offer five-star service. The other ship, Le Ponant, is the original sailing ship. Sales for 2013 are triple the 2012 total and the line’s main aim is to sell via agents, selected high-end online cruise retailers and tour operators.
Is there money to be made in niche cruising?
Agents are being squeezed not only by commissions being cut, but the level of discounts means you are often selling cabins at 50% off. So 5% isn’t much money. Niche cruising has higher average prices and cannot discount because the volumes are not there so they focus on adding value. A very healthy approach. We should be cautious that our pricing strategy long term is right; once a 70% discount is offered it’s very hard to get back to 100%.