While it wasn’t quite as shocking as the Luka Doncic/Anthony Davis trade. It’s fair to say that anyone who saw social media posts about Royal Caribbean Group entering the river cruise market questioned whether the account was posting a prank or if it had been hacked.
The move to launch a river cruises brand under the Celebrity Cruises label was both shocking and unexpected.
Related: Royal Caribbean makes major change for its new ship
Consumers were waiting for more private destination news, new ship announcements, and perhaps more hard information on Royal Caribbean’s long-discussed “Discovery-class” smaller ships. It’s fair to say that very few, if any, journalists or analysts were expected to the river cruises announcement.
Celebrity Cruises President Laura Hodges Bethge talked about the move in a press release that came out right before Royal Caribbean Group’s fourth-quarter earnings call.
“Celebrity River Cruises will bring the quality and sophistication of our Edge Series ocean ships to the most iconic rivers, starting with Europe. We’ve redefined travel on the ocean with our best-in-class hospitality, award-winning food and beverage experiences, and elevated design and style. We are thrilled to bring these experiences to the river and combine them with authentic, destination-rich itineraries that will give our guests an experience unlike any other,” she said.
In retrospect, it’s a bold move, but when you look deeper into it, it makes sense for the brand and company. Royal Caribbean Group CEO Jason Liberty had a lot more to say about the launch during the earnings call.
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Jason Liberty, left, runs the overall company while Laura Hodges Bethge serves as president of Celebrity Cruises.
Image source: Daniel Kline/TheStreet
Celebrity River Cruises launches with 10 ships
Liberty shared some of the overall plans for the new Celebrity Cruises brand during his comments in the Q4 earnings call.
“Beginning in 2027, Celebrity River Cruises will provide yet another opportunity for guests to explore even more destinations with our leading brands. We placed an initial order for 10 transformative ships, which will serve as the foundation for this new Edge-class-inspired product,” he said.
That’s only the beginning, he added.
“Our ambitions, however, go far beyond that. We see river cruising as an exciting growth opportunity that aligns with our strategy of turning the vacation of a lifetime into a lifetime of vacations, expanding our ecosystem of vacation offerings, and broadening our reach into adjacent lines of businesses,” the CEO shared.
Liberty explained why his company sees an opportunity in river cruising.
“River cruising is a sizable and attractive market that has experienced double-digit growth over the last decade driven by increasing demand from both seasoned cruisers as well as new customers. It is a very fragmented market that presents an exciting opportunity for us to win substantial market share,” he added.
River cruising comes with certain advantages
Liberty explained why river cruises make sense in the Royal Caribbean portfolio.
“River cruising is a complementary high margin, high ROIC business that fits nicely within our portfolio,” he said. “The smaller scale of river ships and shorter build timelines allow us for faster deployment and return profiles.”
He believes the new offering will build off what the Celebrity brand already offers.
“Celebrity River Cruises is a natural extension of Celebrity’s premium ocean offering and appeals to a similar demographic of discerning travelers who value immersive, destination-focused experiences. River Cruises spend a disproportionate amount of their time and money on travel, including more spend on all types of cruises. We have a remarkable opportunity,” he added.
Liberty also shared that not offering river cruises might open the door for his company losing passengers to other brands.
“Approximately half of our guests have either already experienced or intend to take a river cruise vacation and a majority of guests who would add an additional vacation to take a river cruise,” he said. “Furthermore, Celebrity’s existing reputation for exceptional hospitality and unparalleled experiences will attract new demand from travelers who are curious about river cruising but who haven’t yet taken that leap.”
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He expects Celebrity River Cruises to be an immediate industry leader.
“Just as we’ve set the standard of excellence in ocean cruising, we will continue to innovate and elevate in the river space. The quality and sophistication of our Edge-class ocean ships will bring cutting-edge design, sustainable technologies, and reimagined onboard and shore experiences that raises the bar for river cruising,” he shared.
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