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March 3, 2013

Ships Ahoy - Part 2: Private Charters vs. Group Cruises




 

Editor’s Note: As introduced Feb. 26 in our introduction to Meetings Afloat – Part 1 article, the MICE sector is increasingly discovering the benefits of the cruise industry for hosting a meeting or event. 

By Susan J. Young

Professional ice skaters spin, glide and leap in razzle-dazzle performances onboard Royal Caribbean International’s 225,000-ton Allure of the Seas, the world’s largest ship. It’s a delightful surprise for vacationers at sea. 

Even more unexpected, the skating rink has a split personality. With stadium seating, the rink adeptly doubles as a corporate meeting venue – hosting events, award ceremonies, incentive programs and conference general sessions. 

More than 700 franchise owners and affiliated agents of CruiseOne and Cruises Inc., two cruise selling groups, sailed on a regularly scheduled cruise of Allure of the Seas for their 2011 annual conference. The conference organizers utilized that skating rink for multiple corporate and supplier presentations. Flooring was placed atop the ice to accommodate conference speakers. Other venues around the ship also doubled as meeting and trade show sites. 

Increasingly, as shown in the above example, vacationers are sailing side-by-side with corporate or incentive groups headed out to sea or onto the world’s rivers. So what’s the best choice? Should planners put a corporate group into a regular sailing? Or should they opt for a more exclusive full-ship charter? 

The correct answer differs in each case depending on the group’s size, budget, itinerary and program. Here are a few key factors for planners to consider.

Full Ship Charters Deliver Exclusivity:  “A charter just takes the cruise meeting experience to the next level,” according to Joyce Landry, CEO and co-founder, Landry & Kling, a MICE sector firm that specializes in creating seagoing events. 

”It takes a trip that is already very experiential and unique and makes it exclusive,” Landry says. Once a client signs a charter contract, “the entire ship becomes a highly customized environment where menus, entertainment and activity schedules, ports of call – everything -- can be structured to fit the charterer’s preferences.”

While a full-ship charter absolutely guarantees complete exclusivity, a half-ship charter may also be an option, based on the line’s needs. Landry & Kling says that on ships with fixed seating in a dining room, a half-charter group may be able to have exclusive use of a main dining room for dinner each evening, with the ability to have customized announcements or programs with dinner. 

 

 

Ship Size Matters for Many Groups: While big ships are sometimes chartered for MICE events, planners says it’s more common for charters on small luxury or expedition ships, river vessels and even luxurious hotel barges; typically these serve as few as six and as many as 500 guests. 

In addition to meals, accommodations and entertainment, typically included for any charter, Un-Cruise Adventures, a small oceangoing line that formerly sailed as both InnerSea Discoveries and American Safari Cruises, will provide charterers with onboard lectures and outdoor team building adventures led by expert guides. 

Sailing in Alaska, Hawaii, the Pacific Northwest and Mexico’s Sea of Cortes, the line recently added the 86-guest Safari Endeavour yacht and the 76-guest Wilderness Explorer expedition boat to its fleet; both have a separate lounge and dining area.  

“With our recent growth, we are now able to accommodate more meeting and incentive groups,” says Tim Jacox, executive vice president of sales and marketing, Un-Cruise Adventures.  “This is a key market and we expect our business to increase significantly.” 

Seabourn Cruise Line, well-known in the oceangoing luxury sector, operates three 450-passenger luxury vessels, the Seabourn Sojourn, Seabourn Odyssey and Seabourn Quest. For charter groups, the line will customize printed materials and entertainment for a meeting or incentive program and even fly the company’s corporate flag from the mast.  

Meetings are often held on days at sea, and a small ship is a cocooning environment.  With a small-ship charter, it’s particularly hard for an employee or group member to “get lost” and not show up for a meeting.  

Simply put, “all attendees are onboard and cannot scatter to the winds,” quips Bruce Good, Seabourn’s director of public relations.  

Delivering the Wow on a Regular Cruise: Big ships have razzle-dazzle features. But if a corporate meeting or incentive group is comprised of only several hundred people or less, a full-ship charter of a 1,500-to-5,000 passenger cruise ship is not doable unless the company has deep pockets. 

What if the client still wants big ship options? Meeting planners easily can book a MICE group into a regularly scheduled big-ship voyage, which is what Landry & Kling did when producing the 2012 Latin America Distributor Convention at sea for SKF, a Swedish ball bearing company.

The convention group boarded Royal Caribbean’s Majesty of the Seas for a four-day journey from Miami to the Bahamas. The conference goal was to generate buzz, increase motivation, and create memorable experiences for 420 attendees. 

Selling SDF into a regularly scheduled voyage gave access participants access to such wow features as a rock climbing wall, pool and sports facilities, an exercise facility with the latest equipment, a full-service spa, diverse dining, robust entertainment and more. 

The cruise industry’s worldwide fleet also fields such other draws as ice or sushi bars, humongous waterparks, virtual reality movie or racing simulators, ropes courses, surfing pools, glass blowing and art studios, drama and computer classes and even a zipline experience.     

Big ships also offer supervised children’s program, many at no charge. So during their free time onboard, mom and dad can spend couples’ time together at the pool, spa or a lounge, or even go ashore, while the kids are playing or hanging out with peers under adult supervision.  

For the KDF convention, participants traveled with other guests. But they had their own schedule of meetings and events. Landry & Kling set up everything from simultaneous Portuguese and Spanish translation services for conference goers during the general session to the construction of “rolling” custom kiosks with plasma screens to showcase SKF’s products and services. 

Because the pool deck wasn’t available for the group’s exclusive use for a farewell event, Landry & Kling worked with Royal Caribbean to take over the basketball court. One obstacle? That court had limited lighting capability at night. So the planners brought in technical equipment including a generator, a power converter and lighting and transformed the space from a sports deck to a party deck. 

The meeting team also brought in a portable DJ booth and inflatable furniture including chairs, loveseats and high-top tables. Lights projected the SKF logo and neon glow sticks and sunglasses added to the South Beach-style club atmosphere. 

It was a huge hit with conference goers. When the SKF event concluded, conference participants gave the oceangoing convention a 4.9 percent satisfaction rating out of a maximum score of 5.  

Space for MICE Programs Abounds:  Large, multi-level theaters on big ships seat hundreds, and in some cases, thousands of guests; theaters are packed in the evening, but often vacant much of the day – perfect for large groups. These venues have state-of-the-art sound systems, multimedia capabilities, professional lighting and large presentation screens. 

Stages can be configured for podium or dais set-ups. Singers and dancers that perform in the line’s evening shows might be utilized, upon request, during a portion of a daytime MICE event. Disney Cruise Line will arrange for a beloved character – Cinderella, Donald Duck, Belle or even Mickey Mouse – to escort the organization’s leaders to the stage.  

Onboard cocktail or comedy lounges – again, not used much during the day – are right-sized for break-out sessions or small group meetings.  After hours, lines might agree to cordon off a secluded outdoor deck for a private MICE event reception under the stars. Some ships also have dedicated meeting space.  

“The number one reason clients choose to host their meetings [at sea] is value,” emphasizes Katina Athanasiou, vice president of corporate, incentive and charter sales, Prestige Cruise Holdings, parent company of Oceania Cruises and Regent Seven Seas Cruises.  “Food and beverage, meeting space, décor, staff and A/V equipment are all included in the cost of the cruise, providing significant savings overall.”

Her lines have recently hosted corporate and incentive groups in the insurance, technology, automotive and health and wellness sectors. She says meeting planners like using specialty restaurants at sea for group “dine-around” functions.

In addition, the “Bon Appetit Culinary Center” on Oceania’s Marina and Riviera can be booked by groups for private functions and team building programs. Participants “bond” while cooking up a savory appetizer or preparing a tasty dessert. 

Next: The Commitments and the Perks 

 

Charters are Big Commitments:  Full-ship charters are advantageous for some corporate functions. That said, they’re not for all and, definitely, not for the faint of heart. To take a ship fully out of service, cruise lines require an upfront financial commitment guaranteed by an irrevocable letter of credit from a bank or other financial institution. 

Essentially, the charterer “owns” the full revenue responsibility for the ship during the charter period. Charter contracts might even include responsibility for certain added fees if revenues from the casino, shore excursion or spa don’t meet certain thresholds.  

Consider a full-ship charter contract as iron-clad and payments made as nonrefundable, as the cruise line is giving up all chance of selling those onboard cabins for the time specified. Even a half-ship charter requires a letter of credit and may also be nonrefundable. 

If a planner opts not to do a charter, but instead just books a group within a regularly scheduled sailing, group attrition and cancellation rules apply, but the financial risk is typically far less. 

Group Perks Aid Meeting Planners: Cruise lines certainly want charters but they also love it when meeting groups buy into their regular sailings. Most employ charter and incentive sales teams to assist potential groups. 

“Crystal typically hosts groups from 40 to 350 guests,” according to Hedwige Roessler, manager of incentives and sales administration, Crystal Cruises. For its onboard groups or charters, Crystal can arrange creative sail-away parties or set up special arrangements for private tours. For one incentive group, Crystal set up a private tour at St. Catherine’s Palace in St. Petersburg followed by a party with dancers.  

Special group rates are available on most cruise lines, usually with a minimum of eight to 15 double occupancy staterooms, but it varies. The threshold for group rates on premium Holland America Line is only five double occupancy cabins; that may appeal to a small group of high-level executives considering a corporate retreat at sea.   

In addition, many lines have created a robust menu of complimentary group amenities for planners or travel agents to access in planning the onboard program. Depending on group size and other factors (some lines use a points-based system), a MICE event planner might choose a complimentary welcome reception for the group, onboard credits for guests, a spa treatment, glossy book about the ship, nightly hors d’ouevres and so on. 

Groups that achieve certain levels also receive a complimentary “tour conductor” berth or cabin; that’s perfect for a corporate staffer or someone in charge of the group or can be used as a promotional give-away.

Finding the Right Itinerary:  Small-ship or river cruises attract full ship charters or groups within regular sailings in Europe, Asia or the U.S., as well as adventure cruises in Hawaii, the Galapagos, the Caribbean or Alaska.  Oceangoing cruise itineraries deliver the world. 

“The Mediterranean typically represents 50 percent of Silversea’s corporate business,” according to Sean Mahoney, global vice president of corporate and incentive sales, Silversea Cruises (onboard theater pictured below). He cites growing demand for eastern Mediterranean voyages between Istanbul and Athens

In addition, “the southern Caribbean is popular with many North American corporations who prefer to travel ‘closer to home’ to avoid negative perceptions and save on air costs,” Mahoney says. Companies from Europe or the Asia/Pacific region tend to prefer Silversea’s western Mediterranean voyages between Rome, Barcelona and Monte Carlo. 

If planners are booking a full-ship charter, many lines will do their best to select an embarkation point that works for the charter group. While a ship already operating in the Caribbean likely won’t be repositioned to Europe just for one full-ship charter, the line may agree to change the point of embarkation within reason – say from one Caribbean port to another. 

Lines may also adjust the cruise segment length to meet the meeting planner’s wishes. Crystal emphasizes that if a company needs 3,000 beds but the ship they desire to charter only has a third that many beds, the line might be able to arrange multiple three-day segments in Europe, thus accommodating the entire group but on separate voyages. 

Sooner is Better than Later: Landry & Kling advises its business clients to start early in planning for a charter – generally a booking should be made 18 months to two years in advance. That’s before any cruise line has released its schedule of voyages to travel agents and the public for booking. 

While some lines may accept full-ship charters closer to the sailing date, that often requires them to cancel a scheduled cruise and rebook those guests who have already booked and made payments on their cruise. 

Bumped guests are often cranky about such cancellations, so the line often must entice them to rebook another voyage with an onboard credit or other bonus. Such costs can be added to the charterer’s contract responsibilities, so booking early helps avoid this. 

Once any charter deal is inked, however, the cruise lines ooze flexibility in assisting those charter clients. For example, Porsche previously chartered Crystal Serenity to launch their Panamera car. So the line loaded five new luxury cars up to the ship decks and transformed the entire ship for the corporate event.  

Group space, too, books up fast, so again, meeting planners are urged to start early in planning for a meeting at sea. One resource for those considering a booking either an individual meetings group or a full-ship charter is www.seasite.com. It’s a Landry & Kling Web site and its “Knowledge Center” boasts good topical articles on how to charter a ship, when to charter, and other meeting at sea topics. 

Stay tuned for next week’s Part 3 of our Meetings Afloat series, which looks at security perks of full-ship charters. Part 4 in two weeks will cover the tax benefits of booking a U.S. flagged line on a specific type of itinerary. 

 

 


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