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Crystal Doubling Capacity

Crystal Cruises will be doubling its capacity in the very upscale market when the company introduces the new 960-passenger Crystal Symphony in the spring of 1995. Plans also call for a third new ship by 1998, according to Arthur Rodney, President of Crystal Cruises. Meanwhile, some modifications will be carried out on the Crystal Harmony when she drydocks in Europe in 1995.

Festivities Set

Virtually a sister ship to the Crystal Haonony, which was introduced in 1991, the 49,500-ton Crystal Symphony is under construction at Kvaerner Masa-Yards where the keel was laid August 31; the float-out is scheduled for June of 1994, and delivery for April of 1995.

The Crystal Symphony will be christened in New York on May 6 (1995) where she will be joined for the occasion by the Crystal Harmony.

Advertising campaigns to introduce the new ship are being launched in the trade press this month and in the consumer press in November.

Rodney said that Crystal had to show its parent company, NYK, that it could fill its first ship, the Crystal Harmony, before the go-ahead was granted to build a second ship. He suggested that the company would also have to fill two ships before ordering a third one.

Douglas Duncan, Senior Vice President of Sales, said that with two ships, Crystal will be able to offer luxury cruises anywhere in the world.

He attributed the company’s success to its consistent product. “We offer high value,” Duncan said, “and we never cut corners.” He said that Crystal Cruises had established a good reputation and benefits from a 28 percent passenger repeat rate.

Duncan also noted that Crystal also benefits from passengers who are “moving up” from the premium product cruise lines, while about 10 percent of its passengers are first-timers.

After being christened in New York on May 6, 1995, preliminary plans call for the Crystal Symphony to sail an inaugural cruise to Los Angeles before being positioned to San Francisco for a series of eight 12-day Alaska cruises. She then sails on to the Far East where the program also includes a turn-around cruise from Bejing. The Crystal Symphony will later also sail from Singapore and Sydney.

In 1995, plans call for the Crystal Harmony to return to South America during the winter season. “We did well in South America in 1993. It was very profitable for us,” said Duncan.

During the summer of 1995, the Crystal Harmony is scheduled to return to Europe for a long season, according to Duncan, who added that the Harmony will also be sailing four 10-day New York-Montreal cruises in the fall. He also said that the ships will flip-flop itineraries in 1996.

According to Duncan, Crystal will be able to generate per diems as high as $600 to $700 on its 88- day Pacific cruise in 1994. “We are also offering this cruise in segments,” said Duncan. “The ideal segment length seems to be 15 days,” he said. “anything longer than that and the market shrinks.”

Luxury Market

The market potential is definitely there, according to Rodney. He attributed some of the company’s success to the fact that it carefully reviews all passenger comment cards and tries to act on their recommendations. He noted that 80 percent of the passengers fill out the forms. One thing that passengers are very much in favor of, according to Rodney, is the Crystal Harmony’s diversified dining experience. While the ship offers two seatings in its dining room, it also features two alternative restaurants.

Rodney also pointed out that the on board casino was operated by Caesars Palace with Las Vegas rules and noted that special gaming tables can be set up at passengers’ requests with virtually no limits.

Duncan added that “people want value and we offer value in the luxury market.” He also said that cruising has matured so that there is increasing product differentiation in the industry which helps distinguish the operators in the luxury market.

In the case of Crystal, Duncan noted that the product is consistent. “We do not have old and new ships, or large and small ships,” he said. “We’ll have two basically similar and basically new ships.”

Snob Appeal Gone

Rodney said that he did not believe snob appeal was an important factor in today’s luxury market. Instead, he said that Crystal aims to offer a sophisticated, friendly and warm experience.

Rodney said that Crystal now has 60,000 members in its past passenger club, the Crystal Society.

Rodney, however, added that he wished that the luxury operators offered stronger competition. Discounting and cut-backs in product experience send the wrong signals to the luxury customers, according to Rodney. He added that Crystal was committed to never cutting costs at the expense of product quality.

Rodney conceded that it has not been easy to build up and establish Crystal Cruises. But he pointed out that the company is now set on a comfortable growth course. And while Crystal was entertaining the idea of acquiring the Royal Viking Sun some time ago, that is no longer of interest since the company has embarked on its own newbuilding program.

“With two ships, our economics will also change drastically,” Rodney said.

Market Leader ?

Crystal seems ideally positioned in the luxury market in North America with the newest hardware and the only established company planning expansion in the market segment.

While Royal Viking Line may enjoy the strongest product name recognition in the market, there are again persistent reports that the cruise line is for sale. Cunard Line’s Sagafjord and Vistafjord, meanwhile, are older ships although Cunard claims to compensate by offering superior service.

The smaller ships of Cunard Sea Goddess and Seabourn Cruise Line are straddling the traditional luxury market and a new small-ship luxury market which has not yet been quite fulfilled.

In addition is Seven Seas which is also in the luxury market although with perhaps a lower name recognition than the market leaders.

Furthermore, newcomers Silversea Cruises and Swedish American Cruises are aiming for the luxury market but with ships that still qualify as “small” based on passenger capacities. ln addition, according to the industry grapevine, travel agents and passengers are still taking pretty much of a “wait-and-see” position on the newcomers.

Thus, when all is said and done, Crystal seems to be left in charge of the traditional luxury market.

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