Cruise figures worry industry

Retailers are bracing themselves for a slow summer after cruise figures showed the third worst April in 10 years. 

Although the first quarter of 2011 held up favourably over the previous two years, April’s cruise figures showed a drop of nearly 13,000 compared to 2010. It is an effect that will be felt by many retail businesses dependent on, or largely serving, the cruise sector. 

Alexandre Tabacoff of Island Companies Ltd said the company had experienced a “fair first quarter.” He put this down to both better cruise and stayover visitors and the company’s concentration on creative marketing, new retail concepts, customer service, training and staff. However, the imminent future looks very different, he added. 

“The second quarter is already showing to be very difficult and we expect the same results with the reminder of summer and early fall. For instance, in May we were down by 26.8 per cent on cruise numbers and June, July, August, September and October are respectively forecast at 30.3 per cent, 37.2 per cent, 35.6 per cent, 40.4 per cent and 12.5 per cent below last year. 

“This decrease will negatively and dramatically affect our sales and will be amplified by the fact that high spending cruisers like Royal Caribbean passengers will rarely visit Grand Cayman this summer and fall. Although we knew that the cruise traffic forecast for 2011 was extremely bad, Island Companies has decided to keep on investing in people, merchandise and store concepts,” he said. “But at mid- and long-term we will not be able to maintain these investments unless a concrete action is taken to bring back cruise traffic on island.” 

The vast majority of the cruise ships scheduled to visit Cayman in the next few months are Carnival ships, a more affordable option that attracts tourists with lower disposable incomes. 

Widening the focus  

Some sectors of the tourism industry are able to actively widen their focus. Bud Johnson at Atlantis Submarines said that so far in 2011 the company had experienced a small improvement over 2009 and 2010 but were still well off other years. 

“We experienced an increase for the Easter week itself, but both the weeks before and after were soft revenue weeks. This was reflected in both our cruise and stayover business,” he said.  

Atlantis has positioned itself to serve both markets and has been innovative in its approach to both. 

“In March, we launched a new website with live inventory, allowing guests the ability to make reservations up to a year in advance. This so far is proving to be well accepted by our online guests and are seeing an improvement in forward bookings, certainly in the short term through June and July. Locally we have made changes to our resident program for the summer, including a reduction in our resident rate, extending this rate to residents visitors, and offering family rates for residents of four or more guests,” he said. 

Trina Christian, executive director of the Cayman Islands Tourism Association, noted that other cruise-related businesses involved with the Association had reported concerns for the future. 

“When cruise numbers were really high in the winter, our cruise representatives were busy and probably a bit less involved in the conversation. But they knew [what was ahead] and they have been expecting this drop.  

“Now that it is here, it really is concerning because there is so much infrastructure that is reliant on a certain amount of numbers.  

And to get that influx of lots of numbers in the winter, then a complete drop in the summer makes it difficult to maintain staff, to maintain product, everything,” she said.