Retired Cruise Exec Sees Continued Role for Agents

What are the top trends in cruise today? River cruising and suites, according to longtime cruise executive Jeff Drew.

“River cruising is the hottest. There’s no doubt about it,” said Drew, who retired earlier this year as senior vice president of sales for American Queen Steamboat Co.

“On the blue water side, the suites on the new ships are unbelievable. Everybody’s really stepping up their game with suites.” And suites are now the first staterooms to sell out on ocean cruises, whereas requests for suites “used to be one in 100 calls.”

Travel Market Report spoke with Drew recently to hear his views on an industry that he worked in for more than three decades.

Drew, whose career included top sales positions at Oceania, Intrav/Clipper Cruise Line, Seabourn and Norwegian, also discussed travel agents’ role in cruise distribution and the profitability of cruise sales for agents.

Boosting agency profits
For travel agents who have seen steady erosion in profit margins on sales of mainstream cruises, consumer hunger for river cruising and suite accommodations on ocean cruises can help keep profits above water, Drew said.

And there are other trends that will help cruise-selling agents stay in the black, he said.

For example, all-inclusive pricing is now available on more cruises, including river cruises and luxury oceangoing lines, yielding higher commissions.

In addition, more cruise lines are paying commission on pre-booked shore excursions.

Amazing excursions
The richness and variety of the shore excursions themselves is another top trend, ranking just behind the explosion of suites in importance, Drew said. Gone are the days when shore excursion options were limited to city tours, snorkeling and shopping.

“The shore excursions are unbelievable,” he said. “I’m blown away at the variety” — everything from winery tours and home-cooked lunch at a local farmhouse to yoga in the rainforest and participatory science adventures in the wild.

At a recent consumer travel show, attendees asked Drew more questions about shore excursions than about the ports themselves. “I didn’t see that even a year ago,” he said.

Demographics
One development that Drew says is not necessarily as beneficial to the bottom line as many agents think is targeting younger travelers.

“I say, give me the older crowd.” Boomers are more mobile and more active than their parents were and “younger in mind.”

Boomers also “are the ones who will book more active shore excursions. And they want comfort, so they want the suites. It’s almost a perfect combination,” Drew said.

Agency distribution
As for the future of the travel agency distribution channel, the fact is that cruise lines couldn’t exist without travel agents, Drew said.

While some lines are driven by price, the more upscale lines need agents to help customers make their decisions. And with so much variety in cruising these days, consumers need agents too.

Especially as cruise lines cut commission costs by selling direct to consumers, for agents specialization and client knowledge are the keys to maintaining a role in cruise distribution, Drew suggested.

Competing with cruise lines
“If you’re competing with the cruise lines for customers, the cruise lines will win. If you focus on a niche or a few niches and know your customers well, you will win.”

For example, there has been a growing interest in expedition cruising, with more travelers wanting to visit places like Antarctica and experience extreme shore excursions like bungee jumping. Those travelers will pay for those experiences, whether or not they’re affluent.

“I don’t think price is the big issue for them; they want to do something new,” he said. “A typical Caribbean cruise is usually driven by price. But the tip of South America — that’s a different matter.

“Get to know your clients and what they like, and they’ll see the value in using an agent,” he said.

And don’t overlook loyalty, which will help you “make up for what you do see eroding,” he said. “It’s the agents who are loyal to particular cruise lines who will win the game. Loyalty pays off.”