Adam Goldstein is president-CEO of Royal Caribbean International, where he has served in various roles over the past 20 years. Mr. Goldstein recently talked to Advertising Age about just that quandary (Hint: cheap deals and unique onboard offerings from a surf park to its latest innovation, a zip line).
Mr. Goldstein also raised the curtain on a new marketing campaign breaking today, the first work from its new agency, WPP Group's JWT.
Ad Age: Given the current state of the economy -- and as we know, discretionary expenses for things like travel tend to go first -- how hard is your business being hit?
Mr. Goldstein: During our last earnings call, we noted that there had been a downturn in business that seemed to emerge around the announcement that Lehman Bros. was going bankrupt. It's just not possible to say with any certainty right now what the depth or duration of the softer bookings will be. Our view is that there has been a lot of uncertainty in the financial markets and in the run-up to the election, so one of the things we are hoping is that knowing who has won the election will make for a more stable environment for consumers to make decisions. But we'll see.
Ad Age: Royal Caribbean, along with a number of major cruise lines, has been making adjustments to its pricing model, rearranging tour schedules to move ships closer to home, and dropping fuel surcharges, for example. What are some other strategies you are using to market yourself right now?
Mr. Goldstein: Right now we have been relying more on discounting to spur business, really more so than we had been before September. About now, you can cruise with us at some pretty attractive prices. We hope people will take advantage of the opportunity.
Ad Age: Can you tell me a bit about the much-talked-about ship Oasis of the Seas?
Mr. Goldstein: Oasis of the Seas is going to come into service just over a year from now; Dec. 12, 2009, is the maiden voyage. She has a phenomenal range of features, and we decided to organize our communications about the ship around seven New York neighborhoods. For example, there is Central Park, which is an elegant, romantic, unprecedented open-air space in the middle of the ship, while the Boardwalk is a family-friendly environment with eateries like Johnny Rockets. This will be the largest cruise ship ever constructed. We think it will take our brand, and the whole cruise industry, to a new level. Although we would have done our new marketing campaign in any event, we think it dovetails perfectly with the spirit of innovation at Royal Caribbean.
Ad Age: What can we expect from the new campaign created by your new creative agency, JWT?
Mr. Goldstein: It starts on Nov. 10. The campaign is a tribute to 38 years of an endless sequence of innovations that have allowed us to be leaders in the cruise industry, in terms of both the physical innovations of our ships and our programs. The way we got there over four decades was by asking "Why not?" Why not have a skating rink on the ship? Why not have a rock-climbing wall? The "Get Out There" platform has been running since 2000, and has helped us tremendously, but our company has changed since that time. ... We wanted a new marketing campaign and marketing platform to talk about our special space, where people are free to be their "Saturday selves" and be as active as they like, or not active as they like. ... We are saying that when you come to the "Nation of Why Not," you are free to come aboard our ships and ask yourselves what if you did this, that or nothing.
Ad Age: In terms of your advertising, what has your media mix historically been, and are you planning to make any adjustments to it?
Mr. Goldstein: We have had a fairly comprehensive media mix. We've been a consistent network and cable TV advertiser for at least 20 years, very visible in newspapers, especially weekend travel sections, and, like many brands, we are increasingly active in the online environment. The one area that we are not active in at the moment, but have sometimes been in the past, is consumer magazines. It is not our intention to go into that space for 2009. We do do trade magazine advertising, however. There won't be any dramatic changes to that. ... We are going to stay pretty consistent with that marketing mix as we go into 2009 and integrate our "Nation of Why Not" materials.
Ad Age: Cruising still seems to be associated with an older demographic and families. Are you undertaking any initiatives to appeal to younger travelers?
Mr. Goldstein: We are very active as a brand in prospecting for new cruises. Our average age has been pretty stable the last decade around 42 or 43 years old, following a big decline that really happened in the '80s, from an average age of 50 or older. We also have a good number of families. I think there is a continuing opportunity to attract singles and couples in their 20s and 30s and we hope the "Nation of Why Not" will be appealing to them.
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