Skift Take

Expedition cruising doesn't get as much attention as mass-market operators that boast of multiple restaurants and flashy water slides. But the sector is growing, and that presents opportunities as well as challenges in catering to travelers who are seeking once-in-a-lifetime experiences.

As high-end travelers seek ever more boast-worthy experiences, the leaders of expedition cruise companies believe they have just the ticket.

“Traveling has been commoditized,” said Daniel Skjeldam, CEO of Norway-based Hurtigruten. “That is what’s driving the interest for expedition cruising. It’s the desire to do something and go somewhere where the rest of the pack is not going.”

Hurtigruten, which is making a larger push into the U.S. market, has a couple of new hybrid ships under construction to bring its fleet to 16. Ponant, a French luxury expedition line that is also trying to draw more American guests, is building six new ships and a hybrid cruise icebreaker for a total fleet of 12. Lindblad Expeditions has a polar ship on order. And late last year, Celebrity Cruises announced an order for a new vessel dedicated solely to the Galapagos Islands. Most of the ships, all quite small, are expected to arrive in the next couple of years.

During a panel discussion earlier this month at the Seatrade Cruise Global conference, Skjeldam and other expedition executives talked about why the sector is growing, what it could mean for the future, and what mass-market cruise lines have to learn from them.

Unprecedented Growth

“We’re all in agreement that we’re in a state of unprecedented growth here,” said Paul Brady, articles editor at Condé Nast Traveler and the panel’s moderator. He asked if the group would have expected the boom five years earlier.

“I don’t see how you couldn’t see this coming five to 10 years ago,” said Ben Lyons, CEO of Expedition Voyage Consultants, which advises cruise lines on planning and operating expedition sailings.

With passengers willing to spent luxury-level dollars for a cramped room on a converted Russian research ship, Lyons said there has been space for actual luxury entrants in the sector.

“We are where the river cruise industry was five to 10 years ago,” Lyons said. “It is not finished yet. The market is continuing to boom.”

Mark Conroy, managing director of the Americas for Silversea Cruises, said there are several reasons for the growth: average rates are high on expedition cruises, and an operator can buy a ship for somewhere in the $100-$200 million range. And while shipyards that build giant cruise vessels are full for several years, there is space to build smaller ships more quickly.

And there are more potential passengers who can afford the higher rates that an expedition sailing commands. The population of high-net-worth individuals grew by 7.5 percent between 2015 and 2016, according to the World Wealth Report released in 2017 by consulting firm Capgemini.

“Previous it was the upper top pyramid who did this,” Skjeldam said. “Now that portion of the market is getting larger.”

Conroy, whose company has a handful of expedition ships, said those trips attract more first-time passengers seeking bucket list destinations such as the Galapagos Islands or Antactica than repeat cruisers.

“That’s been the real great surprise for us is to get a customer who wouldn’t think about cruising to think there are things other than the stereotype of a big cruise company,” he said.

Navin Sawhney, CEO of the Americas for Ponant, said that market wants amenities beyond what they can find on an old Russian ship — and lots of interaction with the surroundings.

“We recognized that today’s consumer has a heightened consciousness … they want direct contact with the environment,” he said. “We overuse words like luxury and authenticity, but an expedition is truly authentic and spontaneous. People want to keep the wilderness about.”

Or as Lyons put it: “A picture of you with a penguin versus a picture of you on a tropical beach is a lot more Instagrammable, if that’s a word.” (Brady assured him that it was a word.)

What’s the Impact?

But the increase of ships — even though they carry hundreds rather than thousands of passengers — leads to new pressures and fears about the impact on the environment and destinations, the executives said.

Sawhney said operators need to understand their environment they’re sailing into and plan itineraries with care.

“You’ve got to be able to make sure that that is thoroughly well planned for safety — not just of the people on board but also the marine life, the people you’ll be visiting … so that the transformation occurs on your end and the environment is left intact.”

Skjeldam said already, cruise lines communicate to make sure they won’t arrive at the same remote location at the same time, and sometimes switch their plans around.

“The entire cruise industry can learn from the way we organize ourselves,” he said. “Both for sustainability but also for the pleasure of our guests.”

Executives also expect that, as more ships enter the market, there will be room for different — and especially lower — price points.

While there are enough travelers who can spend $1,200 a day on an expedition cruise, Conroy said, there are many more who could spend $400-$500 a day.

“There is an opportunity, as we grow, that there may be some pressure on the rates,” he said.

Lyons said he expects to see expeditions segmented into categories according to price and amenities the way the rest of the cruise industry is divided.

“There’s going to be a different view of the expedition industry, not just lumping it together in one piece,” he said.


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Photo credit: Two Hurtigruten ships are pictured in Antarctica. The expedition cruise sector is growing fast. Hurtigruten

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