First Free Story (1 of 3)

More travel executives get their mission-critical industry news from Skift than any other source on the planet.

Already a member?

When Carnival Horizon sets sail next year, the newest ship from Carnival Cruise Line will include two decks of shops including a Victoria’s Secret boutique, a space devoted to wearable gadgets, and a beauty bar.

It’s a look at the direction Carnival is taking with its retail efforts in both renovations to existing ships and the design of upcoming ships like Horizon and the still-unnamed megaships coming in 2020 and 2022.

“That takes retail to a whole other level — three levels of the ship, further expansion of the retail environment in general, additional offerings that we’ll have as well,” said William Butler, Carnival Cruise Line’s vice president of retail, in an interview at the company’s South Florida headquarters. “We’re already forward thinking for 2020. That’s what keeps us on our toes.”

Carnival, which is part of cruise giant Carnival Corp., has renovated shops on four older ships in the past year, and plans to redo four more in 2018 to include more interactive experiences. Those upgrades come as onboard retail still shows “strong” growth, Butler said.

“You can’t say that about all regular retail,” he said. “But it’s because we’re tailoring the merchandise differently than we ever did before.”

The cruise line now has a retail lineup that includes Pandora craft jewelry boutiques on 10 ships, Victoria’s Secret beauty products in the beauty stores on 22 ships, Effy fine jewelry shops on 12 ships, and upscale Swarovski jewelry on 25 ships. Many of those and other stores sell items that can only be purchased on a Carnival cruise.

Turning Shopping Into an Experience

Carnival executives are trying to make onboard shopping a bigger part of the cruise vacation, beyond just physical upgrades to its ships. Many cruise lines already host seminars and events related to the goods they sell onboard, and a shift is on to combine entertaining experiences with the sales pitch as well.

“We do quite a bit now to interject ourselves with entertainment on board the ships as well,” Butler said. He called it “retailtainment.”

For example: A party on the deck timed to coordinate with departure from Cozumel might include a retail component from a Mexico-based company.

“We’ve always had sailaway parties,” Butler said. Now Carnival is “injecting some retail.”

The cruise line also hosts liquor tastings and fine jewelry events with champagne and perhaps a seminar on the history of gemstones — all orchestrated so as not to conflict with each other or overload passengers.

And shops themselves are becoming more engaging, including “make-your-own” jewelry experiences from Pandora and Swarovski.

Butler said the cruise line is trying to elevate the shopping experience, but that doesn’t necessarily mean just adding more expensive stores.

“We’ve elevated ourselves, but we’re still true to who we are,” he said. “We are not elevating ourselves to where we’re stuffy.”

Instead, Butler said the goal is to better integrate retail operations with the rest of a vacation.

“The way that we’re approaching the change is that we’re better tied to the overall cruise experience,” he said.

Another Perspective

Royal Caribbean Cruises, the world’s second-largest cruise company after Carnival Corp., has also been reconsidering what passengers want out of retail.

“One thing you see across the board is you’re seeing people spend much more money on experiences than on things like retail as an example,” Jason Liberty, Royal Caribbean’s chief financial officer, said during a recent earnings call. “Shore excursion or internet or beverage — more things that are experiential in nature than something out of the gift shop — is where you see this change and that’s not just in the higher-end, it’s really kind of across all classes.”

Morningstar analyst Jaime Katz asked if executives at the cruise company were thinking differently about how they portion out square footage on ships.

Michael Bayley, CEO of Royal Caribbean International, said yes, especially as the company starts new renovation programs on Royal Caribbean and Celebrity Cruises ships.

“A lot of the thinking that’s going into that is really thinking through how our guest spend is changing,” he said. “You’ll start to see that when we bring these ships out of the modernization program that we’ve really reallocated space to generate better revenues in areas that we see guests now naturally gravitating to.”

Photo Credit: Cruise lines are trying to get smarter about the kind of retail they have on board and how they get passengers engaged with the shops. Pictured is a Pandora boutique opening on Carnival Breeze. Carnival Cruise Line