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Cruises - US - November 2010

The cruise industry appears to be somewhat more resilient to recessionary pressures than some other segments of the travel industry, such as the lodging sector. However, like many other industries, some companies reported significant declines in 2008 and 2009 but performance is improving in 2010.

While the current economic and geopolitical environment poses many challenges to cruise firms, there are growth opportunities for companies that are keenly focused on the wants and needs of consumers. As such, Mintel has prepared this comprehensive report of the cruise market in North America with a focus on consumer data and insights that can be leveraged to create effective communications and offerings with widespread appeal to those in high and moderate demand segments. More specifically, this report addresses the following questions:

  • How are demographic and macro-economic trends impacting the industry and how have events such as the H1N1 outbreak in Mexico and the BP oil spill in the Gulf region impacted sales?
  • What segments of the population are most likely to have taken a cruise in the last three years and which have large numbers of consumers planning to take a cruise in the next 12 months?
  • What are the most popular cruise destinations in North America and which are becoming less popular?
  • What are the leading cruise companies and how are they marketing their products?
  • What companies are bringing new ships online and what is unique about these vessels?
  • What factors are most likely to motivate one to take a cruise?
  • What are the most common reasons cited for not taking a cruise?
  • How do consumers typically book cruise travel?

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Table of contents

  1. Scope and Themes

      • Definition
        • Data sources
          • Sales data
            • Consumer survey data
              • Direct marketing data and creative
                • Advertising creative
                  • Abbreviations and terms
                    • Abbreviations
                      • Terms
                      • Executive Summary

                          • Market drivers
                            • Cruise incidence and frequency
                              • Top cruise routes
                                • Most popular cruise lines
                                  • Cruise motivators and detractors
                                    • Booking method – registered to receive notifications
                                      • Race and Hispanic origin
                                      • Insights and Opportunities

                                        • Use online trip configurators to provide cost transparency
                                          • Consider price comparisons to illustrate value
                                            • Industry partnerships can offset consumer costs
                                            • Inspire Insights

                                                • Trend: Living Off-Line
                                                • Market Size and Forecast

                                                  • Key points
                                                    • Price reductions primary driver of declines
                                                      • Figure 1: Gross revenues per passenger and per passenger per cruise day, 2006-09
                                                    • Gross revenues and forecast of the North American cruise industry
                                                      • Figure 2: Gross revenues and forecast offor the North American cruise industry, at current prices, 2006-12
                                                      • Figure 3: Gross revenues and forecast for the North American cruise industry, at inflation-adjusted prices, 2006-12
                                                    • Fan-chart forecast
                                                        • Figure 4: Gross revenues and fanned forecast for the North American cruise industry, at current prices, 2006-12
                                                      • Fuel prices undermine profits
                                                      • Market Drivers

                                                        • Key points
                                                          • Rapid growth of 55-74 segment will contribute to demand
                                                            • Figure 5: U.S. population, by age, 2005-15
                                                          • Appeal to married couples to drive sales
                                                            • Figure 6: Marital status, by age, 2008
                                                          • Decline in birthrate suggests adult themes will become more important
                                                            • Figure 7: Households, by presence of children, 1999-09
                                                          • Asians represent bright spot in down market
                                                            • Figure 8: Median household income, by race /Hispanic origin of householder, 2009
                                                        • Market Detractors

                                                          • Key points
                                                            • Decline in median household income causes many to scale back
                                                                • Figure 9: Median household income in inflation-adjusted dollars, 1999-2009
                                                              • Recessionary pressures drive many to vacation at or near home
                                                                • Figure 10: Strategies for dealing with recessionary pressures, by household income, October 2010
                                                              • Weak performance of hotel sector reflects staycation trend
                                                                • High unemployment causes many to watch their budget
                                                                  • Figure 11: Unemployment and underemployment rate in the U.S., January 2007-October 2010
                                                                • Consumer sentiment remains low, driving increased frugality
                                                                  • Figure 12: Consumer Sentiment, March 2007-September 2010
                                                                • H1N1 travel advisory drove down some travel in 2009
                                                                  • BP oil spill does not appear to have directly impacted the industry—yet
                                                                  • Leading Companies

                                                                    • Key points
                                                                      • Carnival, Royal Caribbean, and Norwegian maintain industry dominance
                                                                        • Figure 13: Number of North American Cruises by Cruise Line, 2004-09
                                                                        • Figure 14: Number of North American cruise passenger nights, by leading companies, 2004-09
                                                                      • Carnival companies scheduled to bring four new ships online
                                                                        • Figure 15: Number of ships, by leading cruise lines, 2010
                                                                      • Leading company profiles
                                                                        • Carnival Corporation
                                                                          • Figure 16: Number of ships, by Carnival Corporation cruise brands, 2010
                                                                          • Figure 17: Carnival Corporation annual revenues, 2007-09
                                                                        • Holland America (owned by Carnival)
                                                                          • Princess Cruises (owned by Carnival)
                                                                            • Royal Caribbean
                                                                              • Figure 18: Royal Caribbean annual revenues, 2007-09
                                                                            • Celebrity Cruises (owned by Royal Caribbean)
                                                                              • Norwegian Cruise Line
                                                                              • Innovations and Innovators

                                                                                • New ships
                                                                                  • Carnival: Magic and Breeze
                                                                                    • Royal Caribbean: Oasis of the Seas and Allure of the Seas
                                                                                      • Princess Cruises
                                                                                        • Norwegian Cruise Line: Norwegian Epic
                                                                                          • Targeted promotions
                                                                                            • Targeting special interests
                                                                                              • Figure 19: Special interest cruises appeal, by household income, July 2010
                                                                                            • Carnival Cruises
                                                                                              • Weddings and honeymoons
                                                                                                • Royal Caribbean
                                                                                                  • 55+ and law enforcement
                                                                                                    • Reports from family travelers
                                                                                                      • Stress-free weddings at sea
                                                                                                        • Eco-friendly
                                                                                                          • Orbitz and Travelocity
                                                                                                          • Marketing Strategies

                                                                                                            • Overview
                                                                                                              • Brand analysis: Carnival Cruises
                                                                                                                • Figure 20: Brand analysis of Carnival Cruises
                                                                                                              • Carnival television advertising
                                                                                                                • Figure 21: Carnival Cruises television ad, 2010
                                                                                                                • Figure 22: Carnival Cruises television ad, 2010
                                                                                                                • Figure 23: Carnival Cruise Lines/Wilcox Travel Leaders television ad, 2009
                                                                                                              • Carnival.com
                                                                                                                • Figure 24: Quantcast monthly traffic estimates for Carnival.com, September 2009-August 2010
                                                                                                                • Figure 25: Quantcast U.S. demographic averages for visitors to Carnival.com, May 2010
                                                                                                              • Carnival social media
                                                                                                                • Facebook
                                                                                                                  • Twitter
                                                                                                                    • Brand analysis: Royal Caribbean
                                                                                                                      • Figure 26: Brand analysis of Royal Caribbean
                                                                                                                    • Royal Caribbean television advertising
                                                                                                                      • Figure 27: Royal Caribbean television ad, 2010
                                                                                                                      • Figure 28: Royal Caribbean television ad, 2010
                                                                                                                      • Figure 29: Royal Caribbean television ad, 2010
                                                                                                                    • Royalcaribbean.com
                                                                                                                      • Figure 30: Quantcast monthly traffic estimates for Royalcaribbean.com, September 2009-August 2010
                                                                                                                      • Figure 31: Quantcast U.S. demographic averages for visitors to Royalcaribbean.com, May 2010
                                                                                                                    • Royal Caribbean social media
                                                                                                                      • Facebook
                                                                                                                        • Twitter
                                                                                                                          • Direct marketing strategies by top cruise lines
                                                                                                                            • Figure 32: Cruise industry direct mail positioning trend, 2005-September 2010
                                                                                                                            • Figure 33: Cruise industry email volume trend, July 2007-August 2010
                                                                                                                          • Affluent Baby Boomers primary target of direct mail efforts
                                                                                                                            • Figure 34: Estimated direct mail volume of top cruise line mailers and distribution, by age, January 2010-September 2010
                                                                                                                            • Figure 35: Estimated direct mail volume of top cruise line mailers to top 10 states* and distribution by state**, January 2010-September 2010
                                                                                                                            • Figure 36: Carnival direct mail communication, August 2010
                                                                                                                            • Figure 37: Royal Caribbean direct mail communication, August 2010
                                                                                                                        • Cruise Incidence

                                                                                                                          • Key points
                                                                                                                            • Passenger volume up slightly in 2009, despite recession
                                                                                                                              • Figure 38: Number of North American cruise passengers, 1990-2009
                                                                                                                            • Cruises especially popular with affluents and married couples
                                                                                                                              • Figure 39: Cruise ship vacation incidence, by household income, July 2010
                                                                                                                              • Figure 40: Cruise ship vacation incidence, by marital status, July 2010
                                                                                                                            • Incidence of cruising remains steady, despite recession
                                                                                                                              • Figure 41: Past three-year cruise ship vacation incidence, by total, May 2003- June 2010
                                                                                                                              • Figure 42: Past three-year cruise ship vacation incidence, by household income, April 2009-June 2010
                                                                                                                            • 55-74s will remain key segment
                                                                                                                              • Figure 43: Plans for cruising in the next 12 months, by age, April 2009-June 2010
                                                                                                                          • Cruise Frequency

                                                                                                                            • Key point
                                                                                                                              • Consider focusing loyalty efforts on families with kids under 18
                                                                                                                                • Figure 44: Past three-year cruise ship vacation frequency, by number of children in household, July 2010
                                                                                                                                • Figure 45: Past three-year cruise ship vacation frequency, by age, July 2010
                                                                                                                            • Top Cruise Routes

                                                                                                                              • Key points
                                                                                                                                • Sharp decline in Mexico cruises, the Bahamas become more popular
                                                                                                                                    • Figure 46: Number of North American Cruises, by destination, 2004-09
                                                                                                                                    • Figure 47: North American cruise passengers, by destination, 2004-09
                                                                                                                                  • Many 25-34s prefer the Bahamas, but Europe more popular with the elderly
                                                                                                                                    • Figure 48: Areas traveled to on cruise ship vacation(s), by age, April 2009-June 2010
                                                                                                                                  • Affluents often prefer Caribbean destinations
                                                                                                                                    • Figure 49: Areas traveled to on cruise ship vacation(s), by household income, April 2009-June 2010
                                                                                                                                • Most Popular Cruise Lines

                                                                                                                                  • Key point
                                                                                                                                    • Carnival, Royal Caribbean, and Norwegian remain dominant players
                                                                                                                                      • Figure 50: Cruise lines traveled with, by total, May 2003-June 2010
                                                                                                                                    • Carnival, Royal Caribbean and Disney have high appeal among parents
                                                                                                                                      • Figure 51: Cruise lines traveled with, by marital status and presence of children, April 2009-June 2010
                                                                                                                                    • Most successful firms popular among the middle-income segments
                                                                                                                                      • Figure 52: Cruise lines traveled with, by household income, April 2009-June 2010
                                                                                                                                  • Cruise Motivators

                                                                                                                                    • Key point
                                                                                                                                      • All-inclusive, multiple destination and ethnic foods appeal most to women
                                                                                                                                        • Figure 53: Reasons for going on a cruise, by gender, July 2010
                                                                                                                                      • Multi-destination trips and food choices have high appeal among affluents
                                                                                                                                        • Figure 54: Reasons for going on a cruise, by household income, July 2010
                                                                                                                                      • All-inclusive pricing could motivate many past customers to cruise again
                                                                                                                                        • Figure 55: Potential motivators to take a cruise vacation, by age, July 2010
                                                                                                                                    • Cruise Detractors

                                                                                                                                      • Key point
                                                                                                                                        • Cost concerns a primary barrier
                                                                                                                                          • Figure 56: Reasons for never having taken a cruise, by household income, July 2010
                                                                                                                                        • Time and cost concerns common deterrents among past travelers
                                                                                                                                          • Figure 57: Lapsed cruisers - reasons for not taking a cruise in the last three years, by household income, July 2010
                                                                                                                                      • Booking Method—Registered to Receive Notifications

                                                                                                                                        • Key points
                                                                                                                                          • Many do research online but book with an agent
                                                                                                                                            • Figure 58: Method for booking last cruise, by gender, July 2010
                                                                                                                                          • Use price promotions to entice affluents
                                                                                                                                            • Figure 59: Registered to receive cruise deal notifications, by household income, July 2010
                                                                                                                                        • Race and Hispanic Origin

                                                                                                                                          • Key points
                                                                                                                                            • Asian and black respondents more likely to be planning on taking a cruise
                                                                                                                                              • Figure 60: Plans for cruising in the next 12 months, by race/Hispanic origin, April 2009-June 2010
                                                                                                                                            • Destinations preferences partially tied to cultural orientation
                                                                                                                                              • Figure 61: Areas traveled to on cruise ship vacation(s), by race/Hispanic origin, April 2009-June 2010
                                                                                                                                            • Asians tend to prefer “other” lines, black respondents choose Carnival
                                                                                                                                              • Figure 62: Cruise lines traveled with, by race/Hispanic origin, April 2009-June 2010
                                                                                                                                            • Special interest cruises tend to appeal more to minorities
                                                                                                                                              • Figure 63: Special interest cruises appeal, by race/Hispanic origin, July 2010
                                                                                                                                          • Cluster Analysis

                                                                                                                                              • Aimless Cruisers
                                                                                                                                                • Characteristics
                                                                                                                                                  • Opportunity
                                                                                                                                                    • All Aboards
                                                                                                                                                      • Characteristics
                                                                                                                                                        • Opportunity
                                                                                                                                                          • Uncommitteds
                                                                                                                                                            • Characteristics
                                                                                                                                                              • Opportunity
                                                                                                                                                                • Cluster characteristics
                                                                                                                                                                  • Figure 64: Cruises clusters, July 2010
                                                                                                                                                                  • Figure 65: Reasons for going on a cruise, by cruises clusters, July 2010
                                                                                                                                                                  • Figure 66: Special interest cruises appeal, by cruises clusters, July 2010
                                                                                                                                                                  • Figure 67: Method for booking last cruise, by cruises clusters, July 2010
                                                                                                                                                                • Cluster demographics
                                                                                                                                                                  • Figure 68: Cruises clusters, by gender, July 2010
                                                                                                                                                                  • Figure 69: Cruises clusters, by age group, July 2010
                                                                                                                                                                  • Figure 70: Cruises clusters, by household income, July 2010
                                                                                                                                                                  • Figure 71: Cruises clusters, by race/Hispanic origin, July 2010
                                                                                                                                                                • Cluster methodology
                                                                                                                                                                • Custom Consumer Groups

                                                                                                                                                                  • Lifestyle groups that over-index on cruise travel often enjoy adventure
                                                                                                                                                                      • Figure 72: Cruise ship vacation incidence, by Mosaic Lifestyle Group, April 2009-June 2010
                                                                                                                                                                      • Figure 73: Number of cruises taken in last three years, by Mosaic Lifestyle Group, April 2009-June 2010
                                                                                                                                                                    • Frequent travel groups tend to spend more per trip
                                                                                                                                                                      • Figure 74: Per-person expenditures on last cruise, by Mosaic Lifestyle Group, April 2009-June 2010
                                                                                                                                                                    • Caribbean and Mexico popular destinations with high value groups
                                                                                                                                                                      • Figure 75: Cruise destinations, by Mosaic Lifestyle Group, April 2009-June 2010
                                                                                                                                                                    • White Collar Suburbia most likely to have plans for future travel
                                                                                                                                                                      • Figure 76: Cruise ship vacation incidence, by Mosaic Lifestyle Group, April 20090-June 2010
                                                                                                                                                                  • Appendix—Other Useful Consumer Tables

                                                                                                                                                                      • Gender
                                                                                                                                                                        • Figure 77: Cruise ship vacation incidence, by gender, July 2010
                                                                                                                                                                        • Figure 78: Special interest cruises appeal, by gender, July 2010
                                                                                                                                                                        • Figure 79: Potential motivators to take a cruise vacation, by gender, July 2010
                                                                                                                                                                        • Figure 80: Reasons for never having taken a cruise, by gender, July 2010
                                                                                                                                                                      • Age
                                                                                                                                                                        • Figure 81: Cruise ship vacation incidence, by age, July 2010
                                                                                                                                                                        • Figure 82: Cruise lines traveled with, by age, April 2009-June 2010
                                                                                                                                                                        • Figure 83: Reasons for never having taken a cruise, by age, July 2010
                                                                                                                                                                        • Figure 84: Reasons for going on a cruise, by age, July 2010
                                                                                                                                                                        • Figure 85: Lapsed cruisers - reasons for not taking a cruise in the last three years, by age, July 2010
                                                                                                                                                                        • Figure 86: Special interest cruises appeal, by age, July 2010
                                                                                                                                                                      • Income
                                                                                                                                                                        • Figure 87: Plans for cruising in the next 12 months, by household income, April 2009-June 2010
                                                                                                                                                                        • Figure 88: Past three year cruise ship vacation frequency, by household income, July 2010
                                                                                                                                                                        • Figure 89: Potential motivators to take a cruise vacation, by household income, July 2010
                                                                                                                                                                      • Race and Hispanic origin
                                                                                                                                                                        • Figure 90: Method for booking last cruise, by race/Hispanic origin, July 2010
                                                                                                                                                                        • Figure 91: Registered to receive cruise deal notifications, by race/Hispanic origin, July 2010
                                                                                                                                                                      • Other comparisons
                                                                                                                                                                        • Figure 92: Cruise ship vacation incidence, by household size, July 2010
                                                                                                                                                                        • Figure 93: Special interest cruises appeal, by marital status, July 2010
                                                                                                                                                                        • Figure 94: Plans for cruising in the next 12 months, by marital status and presence of children, April 2009-June 2010
                                                                                                                                                                        • Figure 95: Areas traveled to on cruise ship vacation(s), by marital status and presence of children, April 2009-June 2010
                                                                                                                                                                        • Figure 96: Special interest cruises appeal, by education, July 2010
                                                                                                                                                                    • Appendix—Other Useful Data Tables

                                                                                                                                                                        • Figure 97: Estimated mail volumes of top cruise line mailers, 2005-September 2010
                                                                                                                                                                    • Appendix—Trade Associations

                                                                                                                                                                      Companies Covered

                                                                                                                                                                      • American Express Company (The)
                                                                                                                                                                      • American Society of Travel Agents
                                                                                                                                                                      • AMR Corporation (American Airlines)
                                                                                                                                                                      • Bureau of Economic Analysis
                                                                                                                                                                      • Carnival Corporation
                                                                                                                                                                      • Centers for Disease Control and Prevention
                                                                                                                                                                      • Cruise Lines International Association
                                                                                                                                                                      • Crystal Cruises
                                                                                                                                                                      • Cunard Line
                                                                                                                                                                      • Dell Inc.
                                                                                                                                                                      • Disney Cruise Vacations
                                                                                                                                                                      • ESPN, Inc.
                                                                                                                                                                      • Expedia Inc.
                                                                                                                                                                      • Facebook, Inc.
                                                                                                                                                                      • FOX Broadcasting Company
                                                                                                                                                                      • Hilton Hotels Corporation
                                                                                                                                                                      • Holland America Line Inc.
                                                                                                                                                                      • Hyundai Motor America
                                                                                                                                                                      • NCL Corporation
                                                                                                                                                                      • Nickelodeon Networks
                                                                                                                                                                      • Oceania Cruises, Inc.
                                                                                                                                                                      • Orbitz Inc.
                                                                                                                                                                      • P&O Cruises
                                                                                                                                                                      • Princess Cruises
                                                                                                                                                                      • Radisson Seven Seas Cruises Inc
                                                                                                                                                                      • Regent Seven Seas Cruises
                                                                                                                                                                      • Royal Caribbean Cruises Ltd.
                                                                                                                                                                      • Seabourn Cruise Line
                                                                                                                                                                      • SeaDream Yacht Club
                                                                                                                                                                      • Silversea Cruises
                                                                                                                                                                      • The Cartoon Network
                                                                                                                                                                      • The New York Times Company
                                                                                                                                                                      • Travelocity.com L.P.
                                                                                                                                                                      • Turner Broadcasting System, Inc.
                                                                                                                                                                      • Twitter, Inc.
                                                                                                                                                                      • U.S. Bureau of Labor Statistics
                                                                                                                                                                      • U.S. Bureau of the Census
                                                                                                                                                                      • University of Michigan, The
                                                                                                                                                                      • US Department of Commerce
                                                                                                                                                                      • USA Today
                                                                                                                                                                      • Washington Post Company (The)
                                                                                                                                                                      • Windstar Cruises
                                                                                                                                                                      • YouTube, Inc.

                                                                                                                                                                      Cruises - US - November 2010

                                                                                                                                                                      £3,199.84 (Excl.Tax)