Vacation Agent recently chatted with Jim Berra, chief marketing officer of Carnival Cruise Lines and chairman of the marketing committee of the Cruise Lines International Association. We discussed the 2014 overview for CLIA-member cruise lines and the climate at Carnival. Here’s an edited transcript of the conversation.

CLIA projects more growth in 2014, to 21.7 million passengers, about 400,000 more than 2013. Was there growth in 2013, which was the second tough year for the cruise industry?

Yes, the cruise industry grew in 2013 in part because of capacity increases with new ships and adding berths to existing ships like the Carnival Sunshine. We’ve done a better job of retaining experienced cruisers as events unfolded because the pricing became even more attractive. They recognize the safety and quality of cruising and took us up on our offers.

We’ve also pushed into new markets to gain more diversified global sourcing and stronger retention despite events that took place in the past two years. In any form of transportation, anything can happen, but the likelihood is very small. Couple that with fares and promotions, and it’s a great recipe for reacquiring past guests.

But the growth is slowing in 2014?

That is more related to the slowdown in capacity growth. The ships are sailing full, occupancies are high. Growth is a function of how many additional berths the industry has added. Vis-à-vis five years ago, the pace of new ships has slowed.

You talk about Millennials — those born in the 1990s — as being an even bigger generational boom than the Baby Boomers.

There are 95 million Millennials compared to 78 million Baby Boomers. Now the oldest Millennials are in their mid-20s, but they go back into their teens. They have less purchasing power now than the Boomers, but that will evolve.

Their preferences in travel and how they conduct their lives is very different from the generations that preceded them. It’s a real opportunity for travel. They travel more, they traveled earlier in their lives and it’s important to them. They want shared experiences, things they can share and project out to friends in their social networks.

They communicate heavily online and through social media, and they trust their friends in their social networks more than conventional marketing. They grew up in an age where marketing is omnipresent and there is far more media, both digital as well as broadcast. So they’re savvy in how they react to advertising. That’s why it’s a great thing for Carnival to work with a brand with a good reputation like Dr. Seuss, whose halo also connects to our brand.

The cruise industry is experiencing growth in multigenerational travel. How much of this do you see on Carnival?

Carnival takes 1.9 million reservations a year, and more than half are multiple cabins in a single reservation. I was surprised the stat was that high, although we do observe that anecdotally on our ships, seeing families and groups of friends together. It’s an encouraging sign for where the industry can go. The whole notion of shared experiences continues to grow, whether it’s several generations in the same family or people who play on the same T-ball team.

Does CLIA remain as committed to the travel agent distribution system as ever?

I think more so. Ultimately, as we continue to introduce innovations, diversified itineraries and go global, it’s harder for a large percentage of consumers to navigate that choice without the help of a trusted advisor who can help [find] the experience that works for them.

The types of tools and training CLIA offers will evolve. We need to embrace new technology to make sure the training is more digestible. Face-to-face training is great, but we need to do more short videos, webinars, daily newsletters and things that can relay information very quickly into the hands of agents.

Carnival in September re-launched a more generous Vacation Guarantee — have you had many takers who asked for refunds?

We have 90,000 passengers roughly every week, and we’ve had the program in place for close to 20 weeks. We’ve had less than 30 claims. What we’ve found by doing research and following up is that the majority are events outside of the cruise line — the passenger needs to get back for work, they have an issue at home, a loved one is sick, there’s flooding in their house. We expected it to be pretty low, so we’re encouraged. It’s a great statement of confidence in our people and our product.

How is Carnival faring in its brand recovery?

We’ve seen encouraging signs this fall [since launching a major advertising campaign, which continues]. Web traffic is growing significantly year-over-year, which we hadn’t seen in previous months. Interest in the brand is always improving, especially among people who haven’t cruised before.

Have travel agent bookings increased since the Carnival Conversations travel agent outreach program started?

We’ve seen some improvement, though it’s still early. We recognize that it’s one thing to have a conversation and another to implement and demonstrate through our actions that this program is going to be ongoing. 

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