Seven Seas Cruise Line is entering the 1993 Far East season with having completed its year long switch from marketing primarily to Japanese to targeting mostly Americans. According to Stein Kruse, Executive Vice President and COO, the revamped marketing plan not only included re-directing marketing and sales efforts to American travel agents and consumers, but also moving Seven Seas Cruise Line’s offices from Vancouver to San Francisco, lengthening itineraries, and altering the 172-passenger Song of Flower’s aboard ship product.
Western Approach
Originally Seven Seas Cruise Line entered the seasonal Orient market in spring of 1990 “with the idea of having a Western cruise concept wruch catered to Japanese.” Itineraries were three to five days long in Southeast Asia and primarily included ports featuring beach and sun in an effort to appeal to the Japanese. Americans and Europeans were at that time a secondary market of approximately 20 percent, with the rest Japanese, Kruse said.
However, according to Kruse, the line did not have the proper mechanisms in place to market the ship in Japan. While the Line is owned by shipping giant, K Line, Seven Seas was too much of a niche operator to penetrate the top-heavy Japanese distribution system, Kruse said. “The Japanese distribution system is different; there are two to three huge networks that deal with a few suppliers who then mass market travel products to groups and societies; Kruse explained. “That meant we couldn’t penetrate local markets like we do here,” he continued. While he is convinced that Japan will become a nation of cruisers in the future, he said that no one has yet introduced cruising to the Japanese properly.
While the past year was one of transition, the 1992/93 season now offers longer cruise packages of seven to 14 days wruch include pre- and post-cruise hotel stays, air from the West Coast, and all shore excursions. Other unchanged upscale features of the on board product include a no tipping policy, a single unassigned seating, and an all-inclusive liquor policy. Kruse noted that on board service is now suited more to American expectations and also includes lecturers.
“Ports are also more in tune with North American consumers’ desires,” Kruse said. There are fewer calls at beaches and resorts and more of a mix of ports featuring cities and cultural experiences that Americans seek when traveling to the Orient, such as Singapore, Bangkok, and Bali, as well as expansion into the South Pacific/Great Barrier Reef.
Because of these changes, the 1992 Far East season was made up of 75 percent non-Oriental passengers, primarily Americans with some passengers from Australia and the U.K., and the 1992 Alaska summer season is comprised of approximately 90 percent Americans and Europeans with the rest of the passengers from Japan, Hong Kong, and Singapore.
Marketing
Last year, as Seven Seas was “changing the concept of who we are; Kruse said the Line concentrated mainly on domestic trade advertising in order to “establish relationships with the distribution systems.” In 1992, the marketing plan was expanded to also include consumer advertising and direct mail. Kruse said that Seven Seas “needed name recognition beyond travel agents” since he felt that consumers today are savvy enough to go to an agent with an idea of what line they want to cruise on. Since the line deals with a limited number of targeted agents on a regular basis, Kruse said that “chances are that an agency may not know enough about us to recommend us.”
For 1993, the line will commence select radio advertising in order to continue to build image and awareness. In addition, print advertising will change from national to regional markets, including Florida, Texas, Southern California, New York, New Jersey, and Connecticut, Seattle, Chicago, and Vancouver.
Future
Part of the reason the line is expanding into regional markets is because the ship will be deployed in Northern Europe and the Mediterranean next summer, rather than Alaska as it has been in the past three summer seasons. Kruse said that the majority of the line’s passengers have been from the West Coast due to the Alaska and Orient itineraries. With European itineraries, however, the passenger base can be expanded to the East Coast and Midwest. In addition, the Line now has a repeat passenger following and therefore needs to offer diversity.
The other reason the ship is being deployed in Europe, according to Kruse, is that “if we are ever going to expand, we have to have experience in more regional areas.” He said that “expansion is a lot closer than ever before,” particularly in light of the financial commitment made in moving offices to San Francisco. Kruse said that with K Line’s huge fleet of over 200 ships of various sizes, “I can’t see why we would not expand. We are definitely not sitting idle.”
As far as type of tonnage the line might consider, Kruse did not commit to whether it would be a newbuilding or purchase of an existing ship. However, based on the size of the’ ship the line would consider – an upscale, roomy ship in the 300 to 350 passenger range – there are not many existing ships which fit the bill.
Kruse also said that the line has no intentions of discounting in 1993. “I am a strong advocate that the industry is too price driven,” Kruse said. Discounting does not always attract the right type of passenger and “leads to dilution of the product,” according to Kruse. “Hardly anyone sells the benefits and value of cruising anymore, which is detrimental in the long run especially for niche operators.” He added that if the line does see a need to stimulate demand, then more value would be added to the product. However, a $1,000 savings is offered for those who book back-to-back European cruises and $1,500 for the Orient.
