I recently wrote about our new CX Lab research into cruises and cruise vacations. The CX Lab had 200,000 survey responses last year, in 14 key markets and across 18 industries, so the team is well placed to study how customers across the world are behaving and how their expectations are changing.
One of the key findings that stood out when I read the CX Lab research was the changing demographic pattern in the cruise industry. Cruises have a popular reputation for older, often retired, customers with time on their hands. Afternoon tea and a dinner dance with formal dress is still how some people perceive the cruise experience, but this is changing rapidly as our data clearly demonstrates.
One of the key areas that cruise companies are now using to differentiate their offer is through experiences – directly responding to the Millennial and Generation Z preference for a vacation filled with new experiences, rather than just a lounger by the pool. It’s now common to see skydiving, go-karts, roller coasters, and access to private islands all on offer alongside amazing spas and dinner cooked by celebrity chefs.
This change in approach is needed because around 40% of all cruise customers in the US are now from the Millennial and Generation Z demographic groups. Our research showed that these customers ranked the traditional on-board entertainment on cruises much lower (6.9 out of 10) when compared to what the Baby Boomers think of the same shows (8.3). So a theater show featuring the greatest hits of Abba might not be what a large section of your customers really want.
There is strong evidence that customers are now looking for themed trips, especially focused on music and music festivals, and they are prepared to pay more for cruises offering what they want. That’s hard to ignore, cash is being left on the table.
This change in expectation is extremely important. Issues such as communication, quality of food and drink, and quality of entertainment are all key drivers of customer loyalty. Customers have so many travel options today that once you get them to take a cruise it is important to lock in their loyalty by making them want to repeat the experience. At present though, there is a significantly lower level of satisfaction with the service and entertainment offered to Generation Z customers – they just don’t enjoy the same entertainment options as Baby Boomers.
It’s easy to argue that this has always been the case. Our parents hated the way we dressed and the music we listened to and then we felt the same watching our own kids defining their identity, but in the cruise industry there is a very distinct problem. Generation Z and Millennials find it significantly harder to interact with cruise companies than older customers do and this really matters. If you are not offering the type of customer service they expect – social and across multiple channels – then you may not even get them to book a cruise in the first place. Once booked, a difficult experience contacting customer service can sour the entire cruise and prevent them from booking again.
Many #cruise companies are trying hard to introduce the on-board experiences younger customers want to enjoy, but if they cannot also provide the type of service these customers expect then they will not return.
Please follow me here on LinkedIn to ensure that you see the next in this blog series on your timeline – send me a direct message or email if you would like a copy of the #CX Lab research. Please feel free to let me know what you think about the changing cruise industry by leaving a comment, or use my LinkedIn profile to send me a direct message – or just send me an email directly.