Seatrade Cruise News: Explora Journeys sales doubling weekly, pricing will go up: Ungerer
By Anne Kalosh | 10-24-2023 |
Since Explora I entered service, sales have doubled every week, and pricing will be going up, Explora Journeys CEO Michael Ungerer told Seatrade Cruise News.
After the ship's introduction was delayed several times — and this followed the repeated delays for The Ritz-Carlton Yacht Collection's first ship — luxury customers were taking a wait and see approach to this new brand, according to a key US retail partner. Many wanted their advisor to go first and tell them if it's worth it.
So bookings lagged for this particular retail group even though Explora I has 'delivered beautifully by all accounts' and 'the sales team is working incredibly hard,' the travel partner said. On a recent eight-day Canada/New England cruise the 922-passenger ship was at just 25% occupancy, according to Cruise Week.
Ungerer is confident this will change, especially given the number of influential travel partners experiencing Explora I and the positive word of mouth.
'It takes a bit of time,' he said, for a new brand to get traction.
Seeing is believing
Ensemble Travel Group held its annual conference aboard Explora I's Aug. 1 inaugural cruise, and Ensemble President Michael Johnson was back aboard for Thursday's naming festivities in New York. Other leading retail figures included Virtuoso's Matthew Upchurch, Internova Travel Group's JD O'Hara, Signature Travel Network's Ignacio Maza and Tully Luxury Travel's Mary Jean Tully, among others.
'We're very travel-advisor-focused and we cherish long-term partnerships and we want to get as many [advisors] on board as we can as long as we have space,' Ungerer said.
Advisors have been hearing about 'the ocean state of mind' for several years, but nothing beats first-hand experience.
They're telling Ungerer 'Now we understand' what sets Explora Journeys apart. It offers a luxury resort at sea, with 18 food and beverage choices, four pools and tony boutiques including the first Rolex shop afloat (which, unlike shops ashore where customers have to order the watches, is permitted to sell up to four a day on Explora 1).
Suites start at a very ample 377 square feet/35 square meters and have a bevy of lavish touches.
Ungerer said Explora's European heritage also 'plays a big role' in differentiating the brand.
The company sources about half its guests from the Americas and half from the rest of the world. Fifty to 60 nationalities have been on the initial voyages. And many have been new to cruising.
Prices going up
Explora has no plans to nudge up occupancy by discounting.
'I don't have to price to fill, and I won't,' Ungerer insisted. 'That was one of my prerogatives from day one. And we've raised prices twice since last year and we will raise them again.'
He put the starting per diem at €650, or €1,300 for two in a suite. 'Everything is included. It's great value for money,' he said.
(There is a charge for one dining spot, Anthology, which brings aboard top guest chefs, many with multiple Michelin stars; the price is €175 for a 12-course menu plus €90 for the wine pairing.)
Adding sales clout
In addition to the recent move of MSC Cruises powerhouse Achille Staiano to chief commercial officer at Explora Journeys, the brand has added business relationship leads in New York, Miami, the US West Coast and in Canada, reporting to Saul Fonseca, head of sales, USA East and the Americas, based in Miami, and Aimee Price, head of sales, USA West and Canada, based in Seattle. They report up to Chris Austin, chief sales officer.
Other markets will be getting additional sales support in 2024.
MSC Group came through the pandemic stronger and richer than ever thanks to its container business, and has made a €3.5b commitment to build Explora Journeys into a six-ship fleet.
'No one else could do that at this time,' Ungerer said.
He added that's how the privately held MSC has always operated, quickly building scale to dominate sectors. By 2028, when the sixth Explora ship arrives, this will be the luxury brand with the most capacity, according to current known industry supply growth plans.
The last four ships will be LNG-powered and the last two will also have hydrogen fuel cells to supply power needs in port. All this should make Explora the most environmentally advanced of the luxury cruise operators.
This is 'extremely important to me personally and also to the [Aponte-Vago] family,' Ungerer said, adding that Explora is a beacon for the Group, which has committed to achieving net-zero carbon emissions by 2050.
'The more the marrier'
Ungerer thinks it's great that new luxury brands are entering the cruise sector. 'I love it. The more the merrier,' he said.
He began his career at Ritz-Carlton and remembers the company talking about getting into cruising in the early 1990s. He considers Ritz, Four Seasons and Aman's Orient Express fantastic brands that validate cruising for people who may never try it otherwise.
A growing addressable market
In 2019, when Explora Journeys was doing its research, the team identified a market of 28m affluent customers worldwide.
Ungerer pointed out that at Virtuoso Travel Week in August this year, the luxury consortium said its target clientele, individuals with more than $1m in liquid assets, is growing in every market around the world at a faster clip than projected.
This will generate 16m additional high-net-worth customers between 2021 and 2026. That's 60% more than Explora's projections, a massive boost, Ungerer noted.
He's not concerned about macroeconomic or geopolitical issues, even rising oil prices.
'We're very privileged in our segment,' Ungerer maintained. 'We have assets that move and MSC is truly global. No one is global like MSC in sourcing and distribution.'
As for fuel cost, ships next year will also start paying an EU emissions tax.
'If you want to travel, it's not going to get any cheaper, that's for sure,' Ungerer said.