Richard Bailey, Chairman, Paul Gauguin Cruises

By Theresa Norton Masek

Published on: January 20, 2010

Richard Bailey, who runs five resorts in French Polynesia, acquired the luxury cruise ship Paul Gauguin in August and on Jan. 6 sailed on the inaugural cruise under his Pacific Beachcomber brand. The Louisiana-born, Harvard-educated Bailey has lived in Tahiti for 25 years. He serves as managing director of Pacific Beachcomber and chairman of Paul Gauguin Cruises. We spoke with him about entering the cruise arena and also his development of a sustainable resort on Marlon Brando’s private island.

Why did you choose to acquire Paul Gauguin? It was a tactical decision and a strategic decision. It was tactical because for the past 10 years we have already worked and been the principle partner in pre- and post-cruise stays with the Paul Gauguin. The ship has a fine reputation, so when it became known that its presence in French Polynesia was in doubt, we immediately positioned ourselves. If the ship left, we stood to lose about 3,000 room nights a year from Paul Gauguin passengers alone. It’s a strategic decision because we are a destination specialist. We’ve been here for 25 years, we have five hotels on several islands, and we know the destination. We believe by having a cruise product as part of our portfolio, we will be able to respond to a broader range of customer alternatives for visiting the destination. We want to be a one-stop travel experience provider in French Polynesia.

Are you working with U.S. travel agents? We are a very travel agent friendly company. Our hotels in French Polynesia are very travel trade friendly. This destination by necessity is travel trade friendly. We are an emerging destination with low volume, a somewhat complex message to convey, as well a destination where there is a fair amount of education involved. That type of travel experience does not lend itself to distribution other than with the full support of travel trade, mainly the travel agents. Travel agents remain at the center of our focus in terms of our distribution strategy.

When did you officially take ownership of the ship? We took over the ship on Aug. 15, but Regent Seven Seas still marketed it until the end of the year. We have now set up our own sales and marketing organization in Bellevue, Wash., where we already have two dozen people. We have a res office, a call center and a sales organization. We have sales representatives Joyce Simon in Seattle, Christine Anderson in Los Angeles, Elizabeth Coleman in the Northeast and Jim Applebaum in the Southeast. We encourage agents to contact them for more information. In addition, we have a charter and incentive sales rep for cruise ship. Laurent Le Broten is the acting CEO of Paul Gauguin Cruises based in Papeete, but he will be spending half his time in the U.S. We feel the operations in the U.S. are key. In addition, with respect to the national accounts, we have David Morris International working with us. DMI was instrumental to reintroducing us to the travel agent consortia, where the product was not unknown, but I think some of the travel consortia felt their interests were not aligned with the distribution strategy of the former owners of the vessel.

Are you planning major changes to the Paul Gauguin? We want to try to improve upon a good thing. We have added a naturalist position onboard, which we think enriches the cruise experience in terms of knowledge about the flora and fauna and culture of French Polynesia. We have changed the spa from Carita to Algotherm and we are looking at redecorating it, so we’ll be stepping up our game there. As a destination specialist, we’re also very familiar with all the shore excursion offerings, so we are going through those to decide if some shouldn’t be changed out for others. We found the ship to be in excellent physical condition and obviously no effort will be spared to maintain that condition. Overall, we’ll be looking for ways in which we can offer our superior knowledge of the destination to our guests.

Many other cruise lines have pulled ships from French Polynesia. Is there demand for cruises here? In many cases, cruise ships seek out exotic new destinations in an up market and retreat to domestic departure points in a down market in order to position their product at a lower price point without expensive air travel. So there’s sort of a wave phenomenon of expansion and retreat during economic cycles. Right now we’re experiencing the effects of the down cycle. Tahiti remains a very compelling destination and I’m confident that in the future we’ll attract other cruise operations that are based year-round out of Papeete the same as we do. With respect to expansion plans, right now we’re in a digestion phase, but we think cruising is a great experience for French Polynesia. And we certainly are not excluding the possibility of expansion.

Can you tell us about The Brando, the sustainable resort you planned with the late actor? The resort we’re building on the island of Tetiaroa, Marlon Brando’s island, is the result of a common vision he and I developed over a four-year period from 1999 to 2003. The vision was to build a model community in accordance with precepts of sustainable development, which means that the community is at the intersection of environmental interests, local community interests and, of course, financial interests. At the same time, it would provide a compelling experience for the visitor. We believe that the visitor, the tourist, is the agent of change. When a tourist can be brought to making the right decision from a sustainable development standpoint, by getting a unique experience at a reasonable price point, that’s when the world will begin to change. That’s when green initiatives will find traction.

What is the resort’s physical plant going to look like? The resort will be 100 percent autonomous with renewable energy. The goal is to have as close to zero carbon footprint as possible. We’ll be building a 40-villa hotel, with a spa and all of what guests would expect. We will have an eco-station a research facility focusing on biodiversity, sustainable development and renewable energy – which has attracted a lot of attention from various research institutions. We’ll build the facilities and turn them over to a non-profit organization. We’ll build a staff village the island is 25 nautical miles from Tahiti, so we expect some of our staff will live there permanently, so we need to provide infrastructure for that. We’ll also have approximately 40 residential lots for people who wish to build on them. We’re developing about 150 acres out of approximately 2,000 acres on 12 islets. We hope to have this all built by March 2012.

For more information on Paul Gauguin Cruises, call 800-848-6172 or visit www.pgcruises.com.