BLUe growth connects European Seas BLUES 2017-1-EL01-KA202-036307 IO2- Training Course on Costal and Cruise Tourism M6: Cruise tourism products and services
Cruise tourism products and services
Five specific features of cruises that appeal to travellers
1.
Passengers have the opportunity to visit a variety of places in a short period of time without the problems of other modes of travel.
2.
The ships are self-contained
3.
Cruise ships have a cruise director and staff whose sole function is to make sure passengers have an enjoyable time.
4.
High quality food is served in elegant style.
5.
Everyone usually begins and ends their vacation on the same day
(Rowling RK 2006 cf. Davidoff 1994)
Maritime cruise is influenced by internal factors that are promoted by cruise and ferry operators. Key factors are: diversity of packages, type of vessels, marketing, nice buildings, organized tours and excursions, price, logistics, infrastructure, and access to port and airports. It is also very important the number of cruise ships entering a destination, tourist attractions, tourist infrastructures, logistics ashore, promotion and the use of marketing instruments.
An overview of aspects related to the cruise industry
Cruise tourism creates demands on-shore: hotels, catering, land transport, entertainment, shopping, culture, medical services, spas', sports. (Entertainment, excitement, and education paradigm) Moreover, cruises need a number of dedicated services as ship chandler, fuel supply and repairing.
Norway
(Urbanyi-Popiołek, I., 2014 )
Targeted market must be analysed before establishing a cruise service. Things that must be taken into account:
Analysis of a targeted market before the establishment of a cruise service
Supply side: • Competing cruise ship operators (i.e. vessel capacity, deployment, and utilization) • Competing vessel size distribution • Configuration of existing cruise services • Market structure (how many players, and who is offering which itineraries) • Port call patterns of existing cruise services Demand side: • Cruise ship operators typically focus on disposable incomes and the demographics of the customer base • Potential revenue generation • Seasonality • Brand positioning (exotic ports of call for premium services) • Guest satisfaction (customer oriented industry)
(Notteboom, T. and Rodrigue, J.P., 2012)
A standard cruise itinerary is a loop beginning and ending at a hub port (also called a turn port) and typically lasting seven days with three to five ports of call depending on their respective proximity.
Cruise itineraries: duration
(Notteboom, T. and Rodrigue, J.P., 2012)
Vessel deployment strategies and itinerary design
The cruise industry sells itineraries, not destinations, underlining the core importance in the selection of a sequence of ports of call. Cruise operators are challenged to develop competitive cruise packages but at the same time they have to optimize the deployment of their cruise ship fleet in view of minimizing operating costs and/or maximizing revenue per passenger slot. Vessel deployment strategies and itinerary design are affected by market circumstances. The seasonality in demand, the optimal duration of a cruise vacation, the balance between sailing time and shore time, the existence of ‘must see’ destinations and overall guest satisfaction, the berthing capacity of and nautical accessibility in ports, the distance between ports of call (cruise ships can cover 200 nautical miles per night) and the synchronization with (international) air transfers.
https://pixabay.com/en/venice-italy-cruise-ship-gondolas-2554244/
(Notteboom, T. and Rodrigue, J.P., 2012)
In perennial itineraries the region covered by the itinerary is serviced throughout the year as the demand remains resilient, which is associated with stable (subtropical) weather conditions as well as stable itineraries. The Caribbean is the foremost perennial cruise market (summer low season), but the Mediterranean is also serviced year-round with a winter low season proximity.
Types of itineraries: Perennial
(Notteboom, T. and Rodrigue, J.P., 2012)
Weather is the dominant factor explaining seasonal itineraries, implying that some regions have a market potential only during a specific period or season. This is particularly the case for Baltic, Norwegian, Alaskan and New England cruises that are serviced during summer months. Inversely, South American and Australian itineraries are serviced during the winter months
Types of itineraries: Seasonal
(Notteboom, T. and Rodrigue, J.P., 2012)
Because of the seasonality of the cruise industry the repositioning itineraries between seasonal or perennial markets are required. Cruise companies are increasingly using this opportunity to offer customers lower cost cruises for the inconvenience of having to book air travel arrangements for the return trip since the beginning and ending ports of call are not the same. This mainly takes place across the Atlantic as ships move from the winter Caribbean peak season to the summer Mediterranean peak season (and vice-versa).
Types of itineraries: Repositioning
(Notteboom, T. and Rodrigue, J.P., 2012)
There is a tendency towards a combination of cruise tourism with plane and train travelling. The old round trip cruise has changed to open flight or train & cruise trip.
Cruise / plane / train mixed itineraries
There are three categories of ports based on passenger embarkation/disembarkation: 1. transit ports, 2. home-ports 3. hybrid ports. East Mediterranean and Black Sea regions are currently focus to situate a home port to accommodate the growing cruise industry, providing good weather for “winter� cruising. These days airport connectivity is a key point to develop the cruise industry. Appropriate infrastructures for ships and passengers are also important, though.
Norway
(Bagis, O. and Dooms, M., 2014 ) (Polat, N., 2015)
Watch a video
Fundamentals of itinerary planning (2:08) https://www.youtube.com/watch?v=A6lsfsBmi4w
Would your criteria be the same in all cases?
Individual activity: with which criteria would you select a cruise itinerary to each of these destinations?
Seasonality thus plays a key role in the cruise industry... and is observed both in terms of the regions of embarkation and of destination.
Is the cruise industry seasonal?
(Seasonality will be analysed in detail, in Module 9 of this course) (Notteboom, T. and Rodrigue, J.P., 2012)
Seasonality of cruise tourism
(Maragkogianni, A. and Papaefthimiou, S., 2015)
Since many staterooms can accommodate three to four passengers, occupancy rates are generally well above 100%. The most prevalent occupancy level is around 110% and levels below 100% are rarely seen.
Passengers’ accommodation and occupancy level
(Notteboom, T. and Rodrigue, J.P., 2012)
Cruise tourists spend between 60.25 € and 100 € per night, 78.75 € on average. In terms of spending per hour, cruise tourists expend the same amount of money than the rest of tourist, 8.62 NOK (Norwegian Krone) vs. 8.37 NOK, but they spend less time at the destination than other tourists.
Cruise expenditure
Cruise tourists are low expenders, for example, 42% of cruise tourists can expend less than 250 NOK (26.21 €) per day while only 24% of the other tourists spend that little. On the other hand, 23% of the other tourists can spend more than 1000 NOK (104.85 €) , while only 13% of the cruise tourists spend that much. Finally, cruise tourists use to be older than the other tourists. In addition, they tend to overestimate their expenditure more than other tourists do.
(Larsen, S., Wolff, K., Marnburg, E. and Øgaard, T., 2013)
Cruise expenditure
(Larsen, S., Wolff, K., Marnburg, E. and Ă˜gaard, T., 2013)
Cruises are labour-intensive enterprises with near one onboard employee for every two or three passengers. Employees are typically rigidly stratified in three groups: officers, staff and crew. These groups have separate living areas, and separate levels of restrictions to interact with passengers, and different pays. Sometimes there is an ethnic distinction between employees with officers coming from Norway or Italy, staff native to North American (directors, business, entertainment...), and crew from Asian, Caribbean and Eastern European countries.
Cruise industry services and jobs
(Hung, K., 2018) (Urbanyi-Popiołek, I., 2014 ) Norway
(Wood, R.E., 2000)
During the 90s' waitresses may gain 50$ plus tips (usually 1000-1500$), cooks 500-800$, seamen 500-800$, cleaners 350$. The Philippines is one of the largest exporters of labour forces with an estimate of 4.2 million Philippinos overseas workers in over 130 countries in 1997.
Cruise industry services and jobs
Fantasy themes are common in many cruise-ships with focus in subjects as Disney, Hollywood. There is an increasing awareness of the use of private islands in the Caribbean where there are few profits for the local population and a capsule to exploit cruise tourists by the cruise companies owning these private ports of call. Cruise tourism has increased with a double digit rate during the last decade with China contributing to major passenger growth.
(Hung, K., 2018) Norway
(Urbanyi-Popiołek, I., 2014 ) (Wood, R.E., 2000)
Watch a video
Realistic cruise budget (12:44) https://www.youtube.com/watch?v=rsk6KDE2Gg4
Emissions
Environment
Jobs Blue Growth
Cruise shipping and urban development Economy
Sustainability
Four different impacts of cruise tourism
1. Cruise Core Cruise terminal complex, a gateway facility that performs several crucial functions including the docking and servicing of arriving cruise ships or tenders (small craft employed to ferry passengers between the cruise ship and port). Immigration, customs, security checks, tourism information, parking, shopping, entertainment, tour operator opportunities. 2. Cruise Semi Core Spaces of intensive periodic cruise passenger activity beyond the highly secured and restrictive cruise terminal complex. There use to be a main retail spine where many buildings have been constructed to provide goods and services, restaurants, souvenirs). Often resembles a ghost zone when cruise traffic is absent. Zones of excursion are also included in the semicore. With transit routes conveyed by tour bus, taxi and rental car, marine excursions to isolated islands.
(Weaver, D.B. and Lawton, L.J., 2017)
Four different impacts of cruise tourism
3. Cruise Semi Periphery Central business districts that accommodate excursionists spill-over. The perception of this zone normally is unsafe or unsanitary because there is a interested information provided by cruise lines or social and conventional media. Yet, many disembarked people visit it to by low priced goods and electronics. 4. Cruise Periphery This is the local area not often visited by cruise tourism. Though some arrive through informal excursions, taxis, etc. These spaces have an important influence both in the local economy and in the economy of the cruise lines that try to catch most of the expenditures. Whereas the lines try to focus people in the core area, the local authorities have to focus on the cruise periphery where multiplier effects are the highest.
(Weaver, D.B. and Lawton, L.J., 2017)
Four different impacts of cruise tourism
Multiplying effect on the local economy
Lowest
Highest Cruise core
Cruise Periphery
Highest
Lowest Expenditures
(Weaver, D.B. and Lawton, L.J., 2017)
Often cruise tourists don't use many hotels (i.e. base ports). They generally focus on sightseeing, cuisine, culture, and different amenities. As for example, on board sports: swimming, surf, climbing.
The impacts of cruise tourism on the economy and in the environment
The existence of a good and efficient public transport network with direct connections to the cruise terminals increases the economic return to the city. However, the arrival of large cruises use to collapse the public transport and services of the cities. In addition, many cruise services are provided by trucks and ships, increasing air pollution, noise and increases in the prices of services and logistics. The increase of tourist has externalities such as congestion, emission of pollutants and noise. It will be a necessity to promote the use of public transport, promote foot. Norway
(Urbanyi-Popiołek, I., 2014 )
Conditions for the development of sustainable cruise tourism destinations
• • • • • • • • •
Public transport Foot walking Bicycles Build car parks in zones with high levels of tourists Promote zones with low tourist pressure to enhance the returns of tourism to most of the society Promote the use of waste disposal and recycling by cruise ships. Promote the treatment of waste water ashore to avoid nutrient inputs to the ecosystem and, thus, harmful algal blooms. Promote the connection of cruise ships to the electrical network (avoiding contamination during when they are inside the port) Take consciousness and prevention measures about non local and epidemic diseases.
(Urbanyi-Popiołek, I., 2014 )
Watch a video Why sustainable tourism? (3:35) https://www.youtube.com/watch?v=JFbbKbdqoJg
Environmental impacts of the cruise sector
Norway
(Bagis, O. and Dooms, M., 2014 ) (Polat, N., 2015)
Naples has 1 million people living in the city and near 3 million people living in the surroundings. This city has a huge traffic of cruises that affect the quality of the air, particularly NOx and Sox. About 70% of the ship emissions occur s within 400 km from the coast and it accounts typically to near 5% to the annual PM10 levels, with 10% to PM2.5, and with 10% to PM1 in coastal areas.
The example of Naples
Once in the port, the ship has two different phases that produce pollutants: the manoeuvring phase, and the mooring phase when the ship provides hotel services. During the former phase the main engine is running, while in the second phase the power requirements are provided by auxiliary engines. The atmospheric pollution depends on the prevailing wind directions. There is a clear seasonality in the arrival of cruises with maxima in summer and minima in winter, and also in the time at berth with maxima at noon and minima between 20:00 PM and 7:00 AM.
(Murena, F., Mocerino, L., Quaranta, F. and Toscano, D., 2018 )
• The health impact of air emissions can reach to 24.3 million € or to 5.3€ per passenger. • Shipping can reach 6.2 and 3.1% of the total emissions of NOx and SOx in Greece.
Environmental impacts of the cruise sector
• Piraeus port account for 1/3 of total shipping emissions, Santorini 23%, then Mykonos, Corfu and Katakolo are also important in the total emissions of air pollutants. • There is a clear seasonality of the total pollutant emissions with peaks in summer and valleys in winter: ~50% of emissions are in summer, ~30% in autumn, ~18% in spring and ~2% in winter. • There is an increase of pollution that is indirectly related to shipping, due to the transports and services associated to tourists and ships, as for example taxi, buses, trucks. •
It has been observed an increment of tourism in autumn which is related to an extension of the touristic season.
(Maragkogianni, A. and Papaefthimiou, S., 2015)
Plastic waste: cruise shipping is one of the principal sources of plastics in marine ecosystems. Hazardous emissions: chemicals for cleaning and maintenance, bilge water, ash from incinerators. Air emissions: Nox,SOx,CO2, O3, suspended particles. Smog.
Most important emissions and impacts of cruise ships
Wastewaters: pathogens, inorganic nutrients, particulate matter. Ballast waters: potential of introduction of invasive species. Biocides: as those that are in the shell with the antifouling painting. Physical disturbances and collisions: this has lead in some occasions to the death of whales. Light: the high lights of cruise ships may bother marine organisms, like deep to surface migrants (i.e. copepods)
Norway (Stefanidaki, E. and Lekakou, M., 2014)
The partition of annual emissions among the different activities is: • Hoteling and berth 98.1% • Navigation in port 1.45% • Dock approaching 0.48%
Cruise ship emissions
Cruise contribution to actual concentration levels of pollutants depends on wind direction and, in Naples, it can reach 6% in the case of NO2 and 1.5% in the case of SO2. NO2 contributed by ships has been estimated to reach up to a 32.5% in the case of Brindisi and 9% in Venice. In the case of SO2 has reach 46.3% in Brindisi and 16.5% in Venice. Moreover, if the city is downwind of the port, these concentrations may reach very high levels. As for example, in the case of Victoria (BC, Canadá) where they have reach 57% for NO2and 84% for SO2.
(Murena, F., Mocerino, L., Quaranta, F. and Toscano, D., 2018 )
The cruise industry has a very high level of ownership concentration, since the four largest cruise companies account for 96% of the market as measured by the number of passengers. Most cruise companies have acquired parent companies but kept their individual names for the purpose of product differentiation.
Contribution of the cruise industry to local economic development (?)
(Notteboom, T. and Rodrigue, J.P., 2012)
A ship of the latest Oasis class, which is able to carry more than 6,000 passengers and weights 220,000 gross tons, costs about 1.24 billion dollars and can take four years to be delivered. While Korean, Japanese and Chinese shipyards dominate the global shipbuilding market for container ships, bulk carriers and tankers, the cruise industry orders most of the new cruise ships at European shipyards.
Contribution of the cruise industry to local economic development (?)
(Notteboom, T. and Rodrigue, J.P., 2012)
We have to remember that some economical paradigms (neo-classical model) ignore the existence of limits to growth, the co-dependency between economy and nature, and time factors. Sustainable tourism seeks equilibrium between tourism, environmental protection and the needs of tourists and local population. Tourism is directly dependent upon the quality of the host environment. An unrestrained increase in the number of tourist eventually result in a significant cumulative effect over the environment.
Sustainable cruise tourism: points to remember
There are three main actors in the impact of cruise tourism on the environment. The polluter as resource user, the local community that is “dependent� on the resource, and the administration that is the controller of negative externalities. The direct pollution cost (solid wastes, air pollutants, black waters, vituperated diversity...) can be several times higher than the economic benefits of cruise tourism, and such costs have been found 6 times higher than the benefits in the Adriatic region. Finally, cruises may also produce oil spills with the illegal discharge of oiled bilge waters.
(Carić, H., 2016 )
Watch a video
Ocean Pollution: a Cruise Ship Pollute as Much as 13 Million Cars— in One Day (2:19) https://www.youtube.com/watch?v=CNer4IvzhDA Two Cruise Ships Arrive in Key West FL Time-lapse (00:47) https://www.youtube.com/watch?v=YM6Z279_6kE
Quiz
Now you can go ahead and answer the questions at the quiz for Module 6, that you can find on the BLUES portal at www.bluesgrowth.eu In case you fail the first time, don’t worry. You have a second chance to pass the test. Good luck!
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