Long-term outlook for the cruise industry is quite rosy as more consumers seek experiences rather than goods, according to David Beckel, senior equity analyst with Sanford C. Bernstein
"Eschewing material goods for memories and time with family ... clearly benefits the cruise industry," he told TradeWinds today while at Seatrade Cruise Global in Fort Lauderdale, Florida.
Also, the prevalance of babyboomers and millennials as the industry's two largest customer classes helps the sector's ongoing and expected future success, he said.
"What the industry has done really well is harness the opportunity that millennials present," he said.
Cruise companies are doing this by creating experiences for young millennial families and multi-generational families as the new cruise fans that will hopefully come back again and again, he said.
"I don't see any real reason why that trend won't continue," Beckel said.
Further, he said the cruise industry is "recession resilient" because it often offers a cheaper alternative to land-based vacations.
Riding this wave of optimism, cruise companies are looking to increase capacity as they bolster demand by offering innovations such as apps that allow daily planning, on-board breweries, racetracks and so on, he said.
"They recognise they have to build demand,"Beckel said.
"The cruise industry is going to blow away the hotel industry when it comes to technology," he added.
Companies are also developing new technologies to make it easier for customers to get on board and present them with more revenue makers such as onboard daily events, he said.
"The overarching philosophy is to monetise the guests more effectively," Beckel added.
They also need to create more personalised experiences as the ships get bigger and bigger, he said.
Some are doing this already with apps that match personal preferences to on-board and off-board offerings.
"That's definitely the way the industry is moving,"Beckel said.
He also expects luxury cruising to prosper in years to come as consumers are getting richer and richer.
"Sky's the limit in my opinion," he said.