I Thought Celebrity's Changes Were Driven By Changing Demographics - Not True

[mnocket]

I have chalked up many of the changes Celebrity is making to their desire to appeal to changes in age demographics.   Essentially a belief that the older demographic (baby boomers) were dying off and the average age of the US population was shifting lower.  Thus there was a clear business driver for Celebrity to shift their focus from retirees and above to the younger, working, demographic. 

 

That was my belief until I looked at the data (link below because we are not supposed to cut-and-paste copyrighted images)

Age Distribution of US Population, 2000 to 2050

 

If this data is correct, my premise of age distribution shifting lower in the future was plain wrong. So the question remains..... Why is Celebrity making changes that seem to indicate that we oldsters are no longer their prime target?  The only answer I can think of is that it is not a matter of age, but culture.  Certainly the millennials et.al. have differing desires, behaviors. etc (which I lump into "culture") than us oldsters.  I guess Celebrity's expectation is that as these people age, their desires will not age to be more like current retirees - instead Celebrity's expectation is that the desires of the younger demographic will remain pretty much the same as they grow older.  I don't know that I agree with this.  I know that what I desired when I was younger was much different than what I desire now.   What do you think?  Is Celebrity (and much of the cruise industry) making a big mistake or is there some other driver for these changes?

[Host Jazzbeau]

I don't know nothin' about birthin' no demographics, I only know what I want.  I'm 71, just made Elite, and figure I have at least 10-15 years of cruising left.  But Celebrity doesn't seem to want my business, judging by the reviews of Edge.  As it happens, I just did the math and realized that I can't afford to sail Celebrity after this month's Edge cruise:  if we only sail Azamara until we reach the Elite Plus/Discoverer Plus level, we will have over 50% of our loyalty points on Azamara and therefore qualify for 6 free nights on Azamara.  Even a short Celebrity cruise would ruin that math.  So the loyalty program is about to help Azamara big time, but hurt Celebrity!

[The_Big_M]

14 hours ago, mnocket said:

I have chalked up many of the changes Celebrity is making to their desire to appeal to changes in age demographics.   Essentially a belief that the older demographic (baby boomers) were dying off and the average age of the US population was shifting lower.  Thus there was a clear business driver for Celebrity to shift their focus from retirees and above to the younger, working, demographic. 

 

 

Retirees weren't dying off, and RCL group has full access to the population forecasts.

 

What it appears though is that they were trying to expand their market, by identifying where the greatest possible uptake of cruisers were, and also a demographic that also had large disposable income but moreover were less targeted than by competitors. They see an avenue to capture an expanded market that their competitors have less hold on - not that they want to get rid of their existing cruisers necessarily; just be more appealing to a more youthful group.

 

As an equivalent, in the river sector, there is a brand who has taken that a step further by creating a dedicated younger brand - U.

[The_Big_M]

4 hours ago, Host Jazzbeau said:

I don't know nothin' about birthin' no demographics, I only know what I want.  I'm 71, just made Elite, and figure I have at least 10-15 years of cruising left.  But Celebrity doesn't seem to want my business, judging by the reviews of Edge.  

 

Ah, how the worm turns. Just a few months ago, you were happily telling many of us that we were wrong, and Celebrity was doing everything right as its prices increased because bookings were up.

 

Guess you see that's not so true now.

[yorky]

I many countries the percentage of the population over 65 is going up and up and expected to continue that way. By 2050 the number of people over 60 will be triple what it was in 2000.

Edited January 2, 2019 by yorky

[GastroGnome]

I'm not sure it would ever have been driven by population statistics.  Its too blunt a tool.  The overall number of any demographic group is a population isn't deeply relevant.  You need to know things like average disposable income, holiday expectations / aspirations, loyalty factors etc.  What niche's competitors fill, where the gaps are and where there might be potential to expand.  It will also differ in the UK and the US.  RCL are a large and successful organization - I'm sure they have all the marketing information they need. We might not like the outcome - but I'm sure it has a solid basis. 

 

 

[yorky]

3 minutes ago, GastroGnome said:

I'm not sure it would ever have been driven by population statistics.  Its too blunt a tool.  The overall number of any demographic group is a population isn't deeply relevant.  You need to know things like average disposable income, holiday expectations / aspirations, loyalty factors etc.  What niche's competitors fill, where the gaps are and where there might be potential to expand.  It will also differ in the UK and the US.  RCL are a large and successful organization - I'm sure they have all the marketing information they need. We might not like the outcome - but I'm sure it has a solid basis. 

 

 

All very true of course. Out of interest though I wonder what the average age of contributers on here is, certainly looking at the number of cruises taken and the accommodation many are in there is no lack of disposable income. I’m guessing the average age is not in the 20s. Or maybe this board is not typical of the average cruise demographic.

[hcat]

From inception, Celebrity was a  great smaller cruise line with fewer ships, top shelf everything and an amazingly loyal clientele.  It  had well designed ships , a unique identity and an experience that was like a private Club at sea at ...all at relatively affordable  prices  So lucky we had the pleasure of many cruises with X  over the years.

 

Royal C could not leave it alone  bringing their staff and  mass cruising concepts to X,  slowly killing off the X identity. Other than suite class, Modern Luxury as we knew it phased out, cut by cut.  Traditionsl upscale, elegant and classy  isn"t the  true focus or direction anymore.  X is  a different cruise line now.

 

Regardless of motivation,  EDGE represents the final morphing of Celebrity into just another version of Royal...Fortunately,  some of the new ideas are well done, others need work!

 

Time will tell...

 

 

 

 

[lisiamc]

I know that they didn’t do their research this way, but sometimes it seems to me that they’ve decided to go with everything that they think will chase off their current customers.  

 

I also can’t help thinking of the line from Field of Dreams, “If you build it, he will come”.  If Celebrity builds a product for the Millennials, they will come.  Whether it actually appeals to them or anyone else is another question, I guess.

[cgolf1]

What I am trying to figure out is what Millennials are interested in. The Edge is our first Celebrity but have looked before. In the past Freedom of the Seas won out over a Celebrity ship because of the variety of things to do onboard matches our pace. 

 

We took a chance early on Edge booking when it was cheap thinking there would be more activities to entertain the Millennials. Guess I was wrong looking at the daily sheets recent cruisers have posted. So no clue what the new target market is interested in, so we are packing some books and card and dice games to keep us busy if need be. Guessing it will be fine, we always find something to do:)

 

We we are in are mid 40s so I believe older than there new target market. We definitely don’t impulse buy, unless their is an impulse buy spot in the budget. 

Edited January 2, 2019 by cgolf1

[Rob the Cruiser]

We had not been on a cruise until we were 57 & 58. Prior to that we thought we would never, ever, ever take a cruise. No way.

 

Then we did the San Diego - Hawaii - San Diego cruise aboard Century. We were hooked. So much so that we made Elite Plus in 3 years.

 

If Millennials follow a similar path, Celebrity is in for a long wait.

[Orator]

1 hour ago, lisiamc said:

I know that they didn’t do their research this way, but sometimes it seems to me that they’ve decided to go with everything that they think will chase off their current customers.  

 

I also can’t help thinking of the line from Field of Dreams, “If you build it, he will come”.  If Celebrity builds a product for the Millennials, they will come.  Whether it actually appeals to them or anyone else is another question, I guess.

And it's working! A number of very high number Zenith cruisers either have stopped cruising Celebrity, or discussing moving to another line. I know one "top cruiser" who has cancelled future cruises with Celebrity and considering another line. I know Celebrity will be delighted if they leave since the cabin they would have had will now be occupied by higher spenders who don't cost Celebrity benefits. 

[K12Guy]

19 hours ago, mnocket said:

I guess Celebrity's expectation is that as these people age, their desires will not age to be more like current retirees - instead Celebrity's expectation is that the desires of the younger demographic will remain pretty much the same as they grow older.

There seems to be so much accurate about your presumption. From what I see of the 20 - 40 crowd these days is very few of them seem to take life seriously and they seem to live "in the moment", as if they will never age and their desires/expectations will not change. It might be that development teams working for the cruise lines are being driven, not by those with experience and knowledge, but by those with recent college degrees who think they know everything. Of course we've all been there, right? We know sometimes, as adult youth, it takes a whack to the forehead to realize we really don't know a lot (in spite of great education) about life. In the meanwhile there is an aging demographic that refuses to sit back and die off, being more active and living life more fully than ever before. It's truly a dichotomy for cruise development teams trying to figure out which demographic will keep their ships full and money in their pockets. 

 

Ironically, in twenty or thirty years, long after this keyboard is silent, someone will be lamenting that the current crop of young adults have unrealistic expectations and the millennial crowd will be groaning about how much they hate the changes that are being made and all the growth toward retrofitting ships to the early 2000 themes, including a new ship that has 'suite preference' staterooms and amenities. But lounge hogs will still be a problem on every ship.

 

So, we will tolerate the changes and enjoy being pampered for our fourteen day fall cruise of New England and Canada, and do everything we can to put up with the very few young adults that actually will be aboard.

[TFLG]

As the dad of 3 "millenials" I have some bad news for Celebrity, my kids just don't like Celebrity and they actually laughed when I showed them the videos of the Edge and Eden.  If Celebrity is after Millenials with the Edge they have missed the mark by miles. 

First off, most millenials are broke and the ones with money are not likely to spend it on cruises.  My daughters and thier friends would much rather take off for a week to Paris, London or some other popular destination.  They do it on the cheap, last minute and squeeze a few days to a week in when they can manipulate thier work schedules.  I would guess my kids are the market they are after. They have good jobs and make decent money, so they can afford to travel (and do).  But this generations looks for deals.  They are more likely to book a trip on Groupon that is cheap and last minute.  My oldest went to Paris (twice), London (twice), Iceland, Manchester and Disneyworld last year.  All of those trips were cheap, short and last minute.

 

Celebrity should stick to thier bread and butter 50-70 year olds. I hope they change a bit since I'm on the younger end of that range and to be honest I've always found the entertainment on Celebrity geared more towards my parents generation.  And to keep thier product geared to that range they will need to keep changing.  Right now they need to gear the music to people that grew up in the 80's,  in a few years the 90's and when I'm 80 they will be playing hip-hop for the 50 year olds (yea that'll be fun...not).  Change is inevitable.

[Host Jazzbeau]

5 hours ago, The_Big_M said:

 

Ah, how the worm turns. Just a few months ago, you were happily telling many of us that we were wrong, and Celebrity was doing everything right as its prices increased because bookings were up.

 

Guess you see that's not so true now.

 

Not at all.  Celebrity is doing everything right – for Celebrity.  Just not for me.  Looking at it as a customer is different from looking at it as a stockholder.

[TeeRick]

19 hours ago, mnocket said:

I have chalked up many of the changes Celebrity is making to their desire to appeal to changes in age demographics.   Essentially a belief that the older demographic (baby boomers) were dying off and the average age of the US population was shifting lower.  Thus there was a clear business driver for Celebrity to shift their focus from retirees and above to the younger, working, demographic. 

 

That was my belief until I looked at the data (link below because we are not supposed to cut-and-paste copyrighted images)

Age Distribution of US Population, 2000 to 2050

 

If this data is correct, my premise of age distribution shifting lower in the future was plain wrong. So the question remains..... Why is Celebrity making changes that seem to indicate that we oldsters are no longer their prime target?  The only answer I can think of is that it is not a matter of age, but culture.  Certainly the millennials et.al. have differing desires, behaviors. etc (which I lump into "culture") than us oldsters.  I guess Celebrity's expectation is that as these people age, their desires will not age to be more like current retirees - instead Celebrity's expectation is that the desires of the younger demographic will remain pretty much the same as they grow older.  I don't know that I agree with this.  I know that what I desired when I was younger was much different than what I desire now.   What do you think?  Is Celebrity (and much of the cruise industry) making a big mistake or is there some other driver for these changes?

As you point out the younger people now are of course aging but the distribution is not shifting.  So you have a lot of younger people who are used to technology, multi-tasking, which you characterize as a culture shift.  They become the future retirees and current and future target market. I am in my 60's and retired.  Perhaps years ago I went on cruises and did not care about WiFi and Flat Screens and iPads and even cell phones.  All of these things have come into my life as I aged.  I count on them and enjoy them too.  So what I desired when I was younger has certainly changed over time.  I would not sail on an older ship without WiFi or any of the modern conveniences that I use every day.  I know some older cruisers would disagree and be happy to put away their iPads and iPhones for a week but not me.  

[BosoxI]

51 minutes ago, Orator said:

And it's working! A number of very high number Zenith cruisers either have stopped cruising Celebrity, or discussing moving to another line. I know one "top cruiser" who has cancelled future cruises with Celebrity and considering another line. I know Celebrity will be delighted if they leave since the cabin they would have had will now be occupied by higher spenders who don't cost Celebrity benefits. 

It sure is working.  We started with bookings on two Edge cruises;  we're down to one now and it's only a matter of time before we're down to zero.  The more I read of people's Edge experiences, the less I want to cruise on her.  We've been Elite + for years and my wife hates to lose the benefits, but two cruises on Regent in 2018 have opened our eyes,  In March we're giving Oceania a try.  I have seen enough tee shirts on chic nights to convince me Celebrity is now merely a backup, not our first choice.

[SeaHunt]

Just download the pdf 2019 CLIA (Cruise Lines International Association) "State of the Industry Report Cruise Trends and Industry Outlook" (December 2018) to see their research and you can see the directions they are taking:

 

https://cruising.org/news-and-research/-/media/CLIA/Research/CLIA 2019 State of the Industry.pdf

 

https://cruising.org/news-and-research/research

 

https://cruising.org/news-and-research/research/2018/december/2019-state-of-the-industry

 

I also noted where they mention "Generation Z will be the largest consumer generation by 2020 outpacing even Millennials" = (jmo) their target "Gen Z at Sea" is already beyond M's.

[Lastdance]

1 hour ago, SeaHunt said:

Just download the pdf 2019 CLIA (Cruise Lines International Association) "State of the Industry Report Cruise Trends and Industry Outlook" (December 2018) to see their research and you can see the directions they are taking:

 

https://cruising.org/news-and-research/-/media/CLIA/Research/CLIA 2019 State of the Industry.pdf

 

https://cruising.org/news-and-research/research

 

https://cruising.org/news-and-research/research/2018/december/2019-state-of-the-industry

 

I also noted where they mention "Generation Z will be the largest consumer generation by 2020 outpacing even Millennials" = (jmo) their target "Gen Z at Sea" is already beyond M's.

 

Thanks for sharing these sites.  My DH and I told ourselves that we would keep up with technology and our health to do the things that we wanted, with travel second to health.  We would also plan to embrace as many changes as possible, but also in our own ways.  Life is what you make it, so everyone has their own limits as to what they can and cannot do...although much of that is mindset too.  We also combine a cruise with our own itinerary on land, finding that works best for us...

[Baron Barracuda]

10,000 baby boomers continue to retire every day.  They have free time and disposable income.  In decent health should be able to cruise 15+ years.   If X doesn't want their money Princess, HAL, Oceania, Viking, Regent and others will be happy to take it. 

[mnocket]

12 hours ago, SeaHunt said:

Just download the pdf 2019 CLIA (Cruise Lines International Association) "State of the Industry Report Cruise Trends and Industry Outlook" (December 2018) to see their research and you can see the directions they are taking:

 

https://cruising.org/news-and-research/-/media/CLIA/Research/CLIA 2019 State of the Industry.pdf

 

https://cruising.org/news-and-research/research

 

https://cruising.org/news-and-research/research/2018/december/2019-state-of-the-industry

 

I also noted where they mention "Generation Z will be the largest consumer generation by 2020 outpacing even Millennials" = (jmo) their target "Gen Z at Sea" is already beyond M's.

Thanks for the info.  Correct me if I'm wrong, but if seems all three links wind up at the same report.

 

I still didn't see any statistics showing that the younger age groups will supplant the 50 and up age group as the primary customer of cruise lines.  I can understand cruise lines seeking to increase revenues by ADDING more younger travelers to their established customer base.  The problem I see is that the changes they are making to attract these younger travelers are driving their established customers away.  This just seems like a risky strategy.

[cruising cockroach]

14 hours ago, TFLG said:

As the dad of 3 "millenials" I have some bad news for Celebrity, my kids just don't like Celebrity and they actually laughed when I showed them the videos of the Edge and Eden.  If Celebrity is after Millenials with the Edge they have missed the mark by miles. 

First off, most millenials are broke and the ones with money are not likely to spend it on cruises. 

 

+1.  Unless they were born with a proverbial silver spoon, they're (in the U.S.) mostly up to their eyeballs in higher education debt if they have any post-secondary education.  Tertiary education is no longer affordable for most.  Add in poor full-time/permanent jobs prospects poor mobility compared to previous post-WWII generations.

 

[mnocket]

19 hours ago, GastroGnome said:

I'm not sure it would ever have been driven by population statistics.  Its too blunt a tool.  The overall number of any demographic group is a population isn't deeply relevant.  You need to know things like average disposable income, holiday expectations / aspirations, loyalty factors etc.  What niche's competitors fill, where the gaps are and where there might be potential to expand.  It will also differ in the UK and the US.  RCL are a large and successful organization - I'm sure they have all the marketing information they need. We might not like the outcome - but I'm sure it has a solid basis. 

 

 

Good points.  I did a little more research on disposable income, vacation spending, and vacation expectations.  There are indeed statistics that show that millenials vacation spending is higher than boomers (albeit only marginally higher).  That was a surprise to me. 

[upwarduk]

8 hours ago, Baron Barracuda said:

10,000 baby boomers continue to retire every day.  They have free time and disposable income.  In decent health should be able to cruise 15+ years.   If X doesn't want their money Princess, HAL, Oceania, Viking, Regent and others will be happy to take it. 

Totally agree, I will certainly be looking else where, I can’t imagine the cost of cruising on Celebrity after the £50m refits.

[ambrtonj]

I understand the frustration of change but if I'm not mistaken, there is another generation that I don't see mentioned. Generation X. To me this doesn't mean that Celebrity is targeting Gen X, but I seem to recall the Save the Waves commitment and the "Going Green" initiative both of which would suggest that reducing their carbon footprint would be very important. Not just for cost savings, but for the environment. (I know more Gen X people that are really into "Saving the Planet.") 

 

Now I love balconies and since I refuse to spend that much money on a suite, the chances are not good that I will ever sail on the Edge class of vessel. I do however applaud any company that states their goals then follows through with putting their money where their mouth is so to speak. They are investing in ships that they feel meet that need and I suspect that if the prices come down to what I would call a reasonable amount, the ships will sail full. Not just with Millennials, Gen-Xs, or Boomers, but possibly Gen-Zs.