by Luis De Carvalho | CEO, Bermello Ajamil & Partners, Europe
I recently read an interesting article in the magazine Skift, written by Rebecca Stone. Titled “Lisbon’s Overtourism Lesson: Living Like a Local Is Not Enough”, the article spoke about both sustainable tourism and how tourism can help preserve minority cultures. In essence, the article summarised that the destination should be in control of its development – a stark contrast against letting tourism define its culture.
Obviously, cruise is just a part of the overall tourism equation. In 2017 there were approximately 1.2 billion global tourists of which only 26.7 million were cruise tourists - but if we start taking control of one component, it becomes easier to make the others work as well.
We all know that cruise is flourishing. Cruise Lines International Association (CLIA) has predicted over 27 million passengers to take to the seas throughout 2018 - opening a wealth of new opportunities and economical benefits for all involved in cruise. However, as growth continues on its upwards trajectory, this is still an industry continuing to face questions about destination sustainability.
In short, overcrowding and sustainability in all regions is a genuine concern, including European destinations - but there are solutions.
As a leading port and destination planner, I want to share my insight into the world of destination management and creating a sustainable future for cruise tourism in Europe.
Firstly, let's start with the challenges facing Europe as a region.
I firmly believe that one of the biggest challenges facing the regional industry is the size of the vessels that are being built. Cruise lines are building vessels in sizes that we’ve never seen before and ports and destinations in Europe (and in general) are not able to provide the necessary hard and soft infrastructure at the same pace.
While there are approximately 110 new cruise vessels in the order book (being the majority large vessels carrying over 4000 pax) the capacity in many existing ports has remained largely unchanged and we see little development of new ports and destinations. And, while this comes as a challenge for Europe, I also see it as an opportunity to change the way we look at cruise.
Of course, being able to match the pace of which cruise develops at is crucial - but there are barriers for European ports and destinations trying to keep up and sustain traffic.
Traditionally, ports and destinations have acquired a reactive attitude to cruise.
In Europe, ports have had to regenerate existing waterfronts for cruise rather than building new facilities. European port infrastructure near major tourism centers might go back centuries - meaning harbors and piers are just not large enough to handle these new ships. Naturally, the scale of this infrastructure gap might be more pronounced than in cities or harbors that are newer.
European ports are also servicing mixed markets from European, USA and even Asian sources - which ports and destinations are still learning how to handle. Destinations are also up against a belief that because cruise runs on water, the business belongs to the port – a perception held by politicians and other stakeholders in particular. The real economic impact should really benefit the destination and its communities too – not just the port.
In contrast to regions such as the USA, ports recognize the need to invest in cruise (more specifically to modify and redevelop facilities to accommodate larger vessels). These ports have a good understanding of how investments can be translated into larger economic contributions to the destinations. In Asia, ports are learning fast and creating infrastructure from scratch to fit large vessels in line with the vast potential its source market presents.
Additionally (and this fact might be unknown, ignored or even disputed), we are finding that destinations are rarely the drivers of cruise development - meaning ports are often left to fend for themselves, lead initiatives to attract more traffic and deal with cruise in general. Therefore, port executives are becoming the assigned promoters, sales persons and even sometimes representatives (by default) for the destinations.
While there are a number of barriers for European destinations and ports in keeping up with the speed of cruise - it's more important to consider how these now impact the wider industry.
Many cruise lines are now having to shuffle their ships around to avoid congestion in specific ports and marquee destinations – which of course, all cruise passengers and lines want to visit. Congestion is already a reality in a lot of these places - not solely because of cruise, but primarily due to a lack of tourism planning at the destination in general. For the local communities, cruise just seems to exacerbate the problem.
At B&A we have identified what we call the ‘destination evolution ladder’ where destinations have a starting and an intermediate point before becoming a marquee destination (with opportunities to develop interporting and possibly turnaround traffic).
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- This model is not a general rule, as we are aware that not all destinations will become marquee destinations. But, we do believe that the opportunities for new destinations to emerge and for existing destinations to go up that ladder and improve their visitation numbers are better than ever. Examples of this include Skagen, and Fredericia in Denmark and Tarragona and Cartagena in Spain.
Unfortunately few ports go through this process and I have noticed that many destinations seem to have been “starting up” forever (with no or little increase of cruise traffic for the last 10 years) and some secondary destinations have been secondary destinations for as long as I can remember with little change on their cruise statistics.
Interestingly, when it comes to land based tourism, some of these destinations have made progress and their numbers have increased - yet cruise is still not a priority.
This is where I see a great opportunity for change - and while investment is key, its important for clarity first.
I believe it is crucial for ports and destinations to understand the cruise business and approach it with a more holistic perspective. This requires the collaboration of politicians, legislators, governments, private investors and other stakeholders to both better understand the business and figure out how cruise can generate real benefits for their regions.
However before investing destinations need to firstly agree on WHY they want to become a cruise destination or a tourism destination in the first place. Then the WHY can be transformed into a WHAT (What to see? What to develop? What to sell? What is the USP? What needs to improve? What needs investment? Etc.), and finally the HOW (How to promote? How to market? How to develop the business? How to communicate? How to invest? Etc.).
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Starting with the WHY when developing a plan or a strategy will enable a destination to prepare for and take control of tourism rather than just react to it.
A problem I often witness is ports and destinations starting with the HOW and ignoring WHY. As a consequence, the results are often far from ideal and often end up in community backlashes where people feel that their lives are being negatively affected by tourism.
It is therefore essential to agree and communicate the WHY, WHAT and HOW not only among all local stakeholders and the community but also among cruise lines which should work with the ports and destinations for mutual benefit. At the end of the day, cruise lines share the same goals as the destinations - happy and paying vacationers that return year after year.
Looking for an example? Here's a case in point of how Bermello Ajamil & Partners Europe help overcome challenges facing destinations and ports.
For example in the USA we are designing and developing practical, iconic and state of art cruise terminals to serve the largest cruise market. In Europe, we often assume the role of “educators and facilitators” given the less developed cruise culture among some ports, destinations and governments.
Additionally, we often support smaller ports and destinations with plans, strategies and tools to become secondary ports; assist secondary ports and destinations with port and destination development plans as well as branding to increase volumes and move them into the marquee layer; and marquee ports and destination with master plans, new infrastructure and strategies to consolidate their business and improve the passenger experience.
In order to accomplish the above we have developed a very simple but still comprehensive approach called CRUISES:
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To be successful in any business one needs to have a good understanding of that business and our model provides not only an understanding of the main components of the cruise business, but we gather all these components into a road map to create successful and sustainable cruise tourism destinations.
Events such as Seatrade Cruise Med are the perfect opportunity to start making changes.
I'll be moderating 'Making Cruise Welcome' at Seatrade Cruise Med 2018 - a great opportunity to bring some of the leading figures from the tourism, cruise and the port sectors together to discuss this challenge. The goal of this session is to find a balance between the economic impact from cruise tourism and the sustainability in ports and destinations.
My ambition is to get away from the blame game and instead start a discussion on how cruise can become part of the solution to solve over-tourism and consequently change the current perception of cruise as part of the problem.
By the end of the session, we should have at least five points on how to improve matters on which all parties can agree - and a key starting point for making those action points a reality.