A bedrock operating principle of cruising is that sailing
with 100% occupancy — or as close as possible to 100% — is the way a cruise line
optimizes profitability. The only variable is finding the price that clears
inventory.

But like so many things about cruising and travel,
time-honored principles are being redefined as suppliers plan resumption of
operations, taking health and sanitation concerns into account. And sailing
full is likely to be one of them, at least for a time.

In an interview with
Travel Weekly, Norwegian Cruise Holdings CEO Frank Del Rio acknowledged that “many
of the tenets that make the cruise industry popular — that the ship is your
home, your transportation, your dining, your entertainment, that you travel
around over a seven- or 10-day period, that you visit multiple ports — all
those things that were assets under normal conditions are now being challenged.
And in many cases could be liabilities.”

Buffets, for example, long a staple of ships from contemporary
to luxury, will “probably” be eliminated on NCLH ships, Del Rio said.

Regarding “sailing full,” he said that when NCLH ships begin
operating again, “it’s our belief that demand will be hurt. Not everybody’s
going to want to jump back in the water immediately. So, there’s going to be a
natural social-distancing factor because there will be fewer people on the
ship. 

“But I think two things are going to happen,” he continued. “Over
time, demand will build as people regain confidence that cruising is safe. And
there will be scientific breakthroughs: a vaccine, therapeutics, more
efficient, faster, cheaper testing, or herd immunity. Those two factors will
meet and, sometime in the future  —  it could be at the end of the year, maybe a
little bit longer — demand for cruising will return to normal or near normal
levels.”

Before sailing resumes, however, Del Rio said no effort will
be spared to ensure that vessels are safe. NCLH is working with Dr. Scott
Gottlieb, former Food and Drug Administration commissioner, to establish best
practices and protocols and assess the viability and practicality of
implementing new technologies. “Dr. Gottlieb assures me that there are myriad
new technologies, especially on the testing side, which will be just around the
corner. Testing will be ubiquitous.”

As understanding of the virus improves and the world gets
closer to a vaccine, demand will return to normal, Del Rio believes, and
onboard practices will evolve. “Many of the protocols that we’re living with
today — social distancing, masks, repeatedly washing hands — will be
lessened. As we learn, as we test, as we see the results onboard when we
actually start cruising, we can roll back some of those protocols.”

But until then, he said, “we’re throwing the kitchen sink at
it. We all want safe, healthy environments and need to rebuild trust. This is
not, ‘let’s do the minimum amount required to get by’ or to get the green light
from the CDC. Quite the contrary. I want to be able to look my mother in the
eye, my kids in the eye, my grandkids in the eye and say, ‘You are safer going
on a Norwegian Cruise Line Holdings vessel then you are staying in your
community.’”

From a marketing perspective, Del Rio believes NCLH will be
able to leverage the age of its fleet to promote confidence that, structurally,
its ships promote a healthier environment. “Our ships are, on average, about 10
years old. Our competitors’, on average, are older than that. That means we
have more balcony cabins and suites, and that means more fresh air in cabins.
It’s a competitive advantage that will serve us even more than in normal times.”

Del Rio also believes he has a reputational advantage
because NCLH ships were largely out of the spotlight when outbreaks on other
lines were in the news. When marketing fully resumes, he plans to press that
advantage. 

“We’re very fortunate that our three brands enjoy very high
repeat guests, so we’re going to target first and foremost our travel agent
partners and their clients, particular repeaters,” he said. “And the second
group that will come onboard will be those who might have cruised on another
brand but who will now prefer to cruise on our brands, partly because of our
demonstrated, stellar results during the pandemic. We had just a handful of
cases on board compared to others who had thousands. That’s not going to be
lost on the consumer, and it’s certainly not lost on the travel agents.”

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