RCL onboard revenue growth has grown impressively in 2013, partly due to the success of the new Celebrity 1-2-3 Go program . But can the momentum be sustained into 2014?
- A revitalization of RCL’s onboard programs has carried RCL through a difficult 2013 operating environment. The Celebrity 1-2-3 Go program has done particularly well.
- RCL’s core itineraries in the Caribbean have been 7-9 day cruises, which tend to attract repeat cruisers. Repeat cruisers generally spend more on the ship.
- Since 2001, 2013 was the only time where RCL onboard and other revenue grew while CCL’s fell. It should be noted that the ‘other’ component (Pullmantur excursions) have had an adverse impact so far in 2013.
- As the charts below show, the last couple of times where RCL ticket revenue growth lagged onboard revenue growth by ~5%+, onboard lagged ticket by at least a couple of % points the following year
- Because of Caribbean pressures, ticket revenue continues to grow at a tepid pace. As mgmt mentioned on the call, ticket revenue would play a larger role in 2014, largely due to harder comps on the onboard revenue side. There’s much more uncertainty with that part of the business.