A Sea Change in the Cruise Industry

The world is chasing after Gen Zers—so what can companies learn from an industry that has made them some of its best customers?

The image most people have of a cruise vacation—a stodgy, processed trip for grandparents Decked out in cabana wear—hasn’t changed in years. Turns out, that image is wildly outdated.

In a survey by market-research firm CivicScience, Gen Zers are the age group most interested in taking a cruise vacation. Sixty-nine percent of Gen-Z respondents describe themselves as either “very or somewhat interested,” versus 59% of millennials and only 40% of those 55 and over. For the industry’s  leaders, changing the perception of cruises among millennials and Gen Z consumers has been a conscious, painstaking, yearslong process, says Zach Peikon, a senior client partner in the Global Marketing Officers practice at Korn Ferry.

“They’ve done a great job capturing the enthusiasm of young people around experiences,” Peikon says. He observes that leaders in industries (like retail and sports) that are still struggling to reach this fickle demographic—or even leaders just trying to get Gen Zers to come into the office—would do well to emulate the leaders of the cruise-ship companies. 

Their success with younger customers has gone a long way toward turning the industry around, with trips up 6% since pre-pandemic days—and experts say it began with a strong social-media effort. TikTok, Gen Zers’ social-networking app of choice, is loaded with viral images of the Icon of the Seas, the world’s largest cruise ship, and hundreds of millions of people have watched streams, hashtagged #ultimateworldcruise, in which passengers document their nine-month journeys. Peikon says this social-media popularity speaks to the company’s success in shifting its focus from the product it sells (a cruise) to the experience it provides—an attempt to appeal to Gen Z’s interests that many other hospitality, retail, and consumer-products firms have not been able to duplicate. “What experience are you providing to drive people to the store?” Peikon asks rhetorically.

It hasn’t always been like this for the cruise industry, which battled image problems for years. In comedian Albert Brooks’ novel 2030, about a futuristic America that doesn’t seem all that futuristic anymore, cruise ships are converted into “floating retirement homes” to house the aging population. The joke worked because when the book was published, in 2011, the average age of a cruise passenger was well over 50. At the time, the cruise industry was also confronting many of the same questions airlines are dealing with now, about safety, reliability, and environmental pollution, among others.

Macroeconomic factors have also played a role in the cruise industry’s surging popularity. Cruise operators have been able to keep prices down relative to other types of travel, for instance. But Radhika Papandreou, sector lead for the Travel, Hospitality, and Leisure practice at Korn Ferry, says the cruise industry deserves credit for being particularly innovative in leveraging consumer data—such as engagement surveys and behavioral analytics—to create specialized experiences and offerings. She points to cruises designed for singles and childless couples, themed cruises featuring rock bands or wellness aficionados, and enhanced onboard options, like free Wi-Fi and restaurants run by celebrity chefs. The same cruise can be packaged and messaged to different demographics as well. “They’ve made intergenerational cruising seamless for the sandwich generation,” says Papandreou, “with itineraries designed for kids, parents, and grandparents.”

Like many other businesses, cruises depend on repeat customers. Industry statistics show that people who have taken a cruise are five times more likely to go on another one. By using data to understand what Gen Z wants out of a cruise, Papandreou points out, the industry was “able to create an experience that will hopefully get them to come back.”


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