Hotel Chains Getting Into the Cruise Business – What Does It Mean For You?

Hotels entering the cruise business has been a hot topic…but one without any real perspective. I had my concerns and thoughts before I attended Seatrade Cruise Global, but now have a better perspective after attending the “Will Hotel-Operated Cruise Lines Solve the Industry New-to-Cruise Conundrum?” session.

One thing that stands out to me is that most hotel stays are for only a few days and stays at resorts are rarely longer than a week. Now, one might hop from one hotel to another – traveling between them – but no one is looking at land journeys vs. cruises rather than a hotel-focused trip and a cruise.

That said, let’s take a look, first at the ships, then at what impact they may have on the cruise industry, and, finally, what the cruise lines are doing to be more like hotels.

Ritz Carlton Yacht Collection was the first and, frankly, the poster child for how not to do it. Between revolving door executives and bankrupt shipyards, among other issues, the Ritz Carlton project really put a pox on all new builds, draining consumer confidence. Then, once the ship was near completion the shipyard that came to its rescue came out with two new ships that are much larger and have little in common with the boutique ship Ritz Carlton initially envisioned as they will literally be twice the size, have higher space-to-passenger ratios, higher staff-to-passenger ratio and will have five restaurants, six bars, a wine vault, a marina, and a spa. Ritz-Carlton Yacht Collection: What is Really Behind the “Deal” to Build Two More Ships? – Goldring Travel

The Ritz Carlton Evrima, a 200-guest ship, really hasn’t had much of an impact on the cruise market…other than scaring potential customers from booking early sailings on any new ship. (Seabourn contributed to this issue with the repeated delays of Seabourn Venture.)  But let’s not jump ahead!

The interesting thing is that, according to Ritz Carlton, over 80% of Evrima’s guests are Marriott Bonvoy members and a very large percentage of its guests are “new to cruise”.  Does this mean that the focus is on expanding into the cruise market or something else?  Hold that thought!

Four Seasons is now getting into the cruise business…and it is doing it in a far better fashion than the Ritz Carlton debacle. This will be another small, 95-suite (less than 200 guests), ship with suites starting at 581 square feet and 60% of them exceeding 818 square feet. Headed by Larry Pimental, who came out of retirement to lend his decades of experience, the Four Seasons team is anything but “new to cruise”. So I expect the construction process and initial cruise experience to be far smoother than Ritz Carlton.

A third entity is Cruise Saudi in association with Aman Resorts with a 600-foot-long 100-guest all massively sized suites. (For perspective, Windstar’s Star Pride is about 522 feet long and holds 312 guests.)  As Cruise Saudi advised me, the deal to purchase Seabourn didn’t happen and they went in a different direction…which clearly focused on the Ultra High Net Worth market, which is actually more akin to the Superyacht market, with the concept of expecting the ship to be fully chartered out by its guests, rather than sold on a per suite basis.

Orient Express is going in a more unique direction with a 720-foot sailing/LNG-powered ship, again with only 54 suites averaging over 700 square feet. So, more akin to the Cruise Saudi/Aman Resort ship, the ultra-high-net-worth individuals are clearly the target.

Now, let’s get back to the question at hand: “Why?“

During the Seatrade Cruise Global session, I asked the question, “Are you getting into the cruise business to retain your current guests or are you looking to expand your base by offering a different experience?”   The answers by each should by now be a bit self-evident.

With Cruise Saudi-Aman and Orient Express, it appears the primary focus is not on expanding into the cruise business, but on offering their ultra-high-net-worth clients an alternative to superyachts (probably priced about the same and less on a per-guest basis) and, to a lesser degree, some of the top suites on cruise ships.  Why a lesser degree? Because these products are focused on the ultimate in privacy with very little interaction (if any) with other guests…unless it is a whole ship charter.  Most of the guests that book the top suites on cruise ships want exclusivity and privacy, but also a bit of interaction with other guests or experiences.

Four Seasons is only 200 guests and no matter how good the product is, I see it as a client retention venture. While it may compete with some of the cruise lines’ top suites, there just isn’t enough inventory to make a big impact on sales. Now, a big impact on marketing…which, in turn, sells more hotel rooms…that is another question and, as I said, pretty self-evident. 

Ritz Carlton, however, is another thing.  It seems to be getting the kinks out of its first, one-off, ship. But the offerings and service levels do not seem to yet be where they need to be. There is no doubt the guest is, at this point, happy. But as most are new-to-cruise, I caution, “You don’t know what you don’t know.”  As its two new, larger, ships come online in the next few years I think there will be more to talk about.

So with only one hotel-associated ship with 200 guests currently operating and heavily booked with hotel guests that are new-to-cruise, the impact of the Ritz Carlton ship is minimal. When Four Seasons comes online and then the new Ritz Carlton ships in 2025-26, there might be a bit more to substantively discuss. 

NOTE: When I say minimal, I don’t mean the impact of negativity toward booking new ships.  It used to be a fight to book the maiden voyage. Between the constant negative press and chaos with Ritz Carlton’s and Seabourn’s new ships, there is a new skepticism in the marketplace.  Some of it is well-founded, but I believe unfairly overstated.

However, there is another side to hotel-associated cruise ships. Cruise lines that are making their products more hotel-like, such as Explora Journeys with its focus on residences, hotel-esque interiors and options:

Exquisitely designed with the guest and relaxed, home-like comfort in mind – and in partnership with the world’s foremost superyacht and luxury hospitality designers – the innovative ship will seamlessly blend elegant Swiss precision with modern European craftsmanship and vibrant design…

With 461 oceanfront suites and residences, guests will enjoy feeling closer to the sea and in port thanks to their floor-to-ceiling windows and personal private terrace. 

Regent Seven Seas Cruises takes a different approach, looking at the value proposition with its infamous can seemingly ubiquitous chart:

Now, I’m not sure all those prices are accurate (ex. business class air at $15,998?) or that those on luxury cruises are going to limit themselves to the lesser group tours, but it is Regent’s approach.

Basically, I don’t see the hotels dipping their toes into the cruise business having a real direct impact on the market. Yes, there will be some new-to-cruise guests that wander off from their branded hotel’s offerings. Yes, there will be more publicity about how cruises are actually something for hotel-focused travelers to consider. 

In the end, cruise ships are not hotels, but rather experiential venues that offer an amazing combination of hotel and travel services that each guest can partake in as they so desire. Some cruise ships are designed as amusement parks (Royal Caribbean), party places (Margaritaville), expedition focused, etc. 

A hotel will never be just a cruise ship and cruise ships will never be just a hotel.  They can, if your travel agent is knowledgeable enough, have them together to provide an amazing combination of pre-cruise, cruise, and post-cruise experiences. 

Different. But Similar.