Cruising with Chinese Characteristics: Cruise Giants Cater to New China Market

Cruising with Chinese Characteristics: Cruise Giants Cater to New China Market
Mar 30, 2016 By eChinacities.com

Editor's Note: The Chinese cruise industry has seen a tidal wave of growth in the last four years, growing about 45% each year. Company executives are navigating the new market, learning about Chinese passengers as they go, and refitting their voyages to Chinese sensibilities. This means ships with more eating, and less drinking. More shopping, and less relaxing. The benefits to entering the Chinese market are clear, so cruise lines have no problem pandering. The article reports on the cruise company's entering China.

International cruise giants are competing for the huge Chinese consumer market. In order to attract Chinese customers, many cruise lines are making special concessions for their Chinese passengers to cater to the unique spending habits of Chinese tourists.

The president of MSC Cruises complained to the Financial Times last October about the habits of his Chinese passengers. He said that he was confused to as why Chinese tourists want to eat every hour while on a cruise. “They do not stop eating. There is no obvious gap between meals,” he said. “If Chinese tourists continue to eat like this, how can we afford it?”

Despite the president’s complaints, there are huge profits to be made in the Chinese market for international cruise companies. The promise of these profits has led cruise companies to cater to Chinese companies, even if that means spending more on things like food.

A Huge, Growing Market

China’s 10 ports received a total of 629 cruise ships in 2015, an increase of 35%. 2.48 million Chinese took cruises this last year, an increase of 44% from the previous year. These statistics were recently released by the China Cruise & Yacht Industry Association (CCYIA) in March.

The Paper recently interviewed a number of representatives from foreign cruise companies that have entered the Chinese market. Although some cruise companies complain about Chinese customers eating too much on cruises, the benefits of entering the Chinese market are clear. “Chinese tourists spend an average of $200 while on a cruise, mostly on food and shopping. In the future, this amount will definitely continue to increase,” said Tuniu cruise division manager Liu Jianbin.

Industry insiders agree that the rapid growth of the Chinese cruise market will continue for some time.

It is predicted that by 2035, China will have more than 10 million cruise passengers annually. The Chinese Ministry of Transport has said that by 2020, the number of Chinese cruise passengers in the Asia Pacific region will reach 4.5 million, making it the world’s largest cruise market.

Liu said that the penetration rate is much higher for the cruise market in China than in Europe and other developed countries. “However, even if the penetration rate is three out of 1,000, China will have 4 million cruise passengers. The market currently is growing at a rate of 1.2 million passengers a year.” Liu added that that market will experience huge growth within the next two years.

China’s cruise industry took a hit in 2015 because of the MERS epidemic in South Korea and other factors. However, in 2016, the industry rebounded and the market is strong.

Ctrip’s “2016 Cruise Trends Forecast,” predicted that this year, Chinese ports will see an increase of 80% more traffic, and 2 million passengers will take cruises out of Hong Kong. By 2017, 19 cruise companies will operate in China and all cruises will be filled to 50 to 70% capacity.

Investment in China as Development Strategy

Many international cruise giants have invested in the Chinese market as a development strategy for the coming years.

Carnival, Costa Cruises and Princess Cruises have already set up shop in China. In 2017, Carnival Group will introduce AIDA Cruises and Carnival Cruises into the Chinese market.

Princess Cruises has a ship in China named Golden Princess. The company also plans to introduce a new ship this year named Spirit Princess, said Princess Cruises Executive Vice President of International Operations Anthony Kaufman. Spirit Princess will be tailored to specifically cater to the Chinese market and will make its first voyage in 2017 in Shanghai. A number of cruise giants do not want to use Shanghai, Tianjin and other major hubs as their home ports and are looking to second and third tier coastal cities like Xiamen, Qingdao, Yantai, and Haikou in order to attract tourists from other regions.

Princess Cruises has announced that they plan to use Xiamen as a homeport in addition to Shanghai and Tianjin. Bohai Sea Cruises, Royal Caribbean Cruises, and MSC Cruises will open routes that begin in Qingdao in 2016. Qingdao will be the hub for 70 cruises this year, according to the Shandong Provincial Department of Communications.

Hot Pot and Sunrise Tai Chi

Cruise companies are tailoring their trips to their Chinese customers. “We have found that many things that work well in foreign markets do not work in China. Chinese customers must be given a tailored product,” said Kaufman. Princess Cruises plans to offer services including hot pot, and sunrise tai chi in 2016. Golden Princess, which embarks from Tianjin, employs chefs from northern China to cook for the ship’s mostly northern Chinese guests.

“Chinese tourists have very different consumer preferences than foreign tourists. Most Chinese passengers spend money in shopping centers, casinos, and other entertainment facilities while on a cruise.” Liu said that foreign companies have started to make changes to cater to their Chinese clients. “Chinese tourists are not very interested in bars and spas. Many cruise lines have made these smaller or turned them into shopping centers or dining facilities.”

Source: The Paper

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Keywords: cruise lines China cruise companies market

5 Comments

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1

kuntmans
comment|70139|307009

At least the cruises would be much more tolerable here given chinese don't like to binge drink. more banter in the restaurants too. look forward to trying one here at some stage

Apr 05, 2016 20:38 Report Abuse

2

JohnathonSteel
comment|70131|1579661

Mainland locusts ruin cruises, more news at 11.

Apr 05, 2016 10:41 Report Abuse

3

atiqsumon
comment|70096|1622559

Love their news..!

Apr 01, 2016 14:16 Report Abuse

4

dom87
comment|70035|102513

so to cater to the Chinese you would make the ship a swimming ktv brothel? sounds good, at least if you sink the ship somewhere in the middle of the ocean

Mar 30, 2016 10:37 Report Abuse

5

Guest388182
comment|70025|43131

and with continued eating of course comes continued_____________ and ____________everywhere

Mar 30, 2016 08:17 Report Abuse