The Business of Vacations

Ensconced in the luxurious observation lounge of a brand-new 168,000-ton ship, Meg Lee, chief marketing officer of Norwegian Cruise Lines, greeted me with smiles and a champagne glass. This demonstration of the notion that travel should be fun ended with my first question about her definition of marketing. She responded: “filling ships.”

“My job is to fill a fleet of 16 ships—that’s a couple of million people a year,” Lee said. And it’s not an easy job, given the highly competitive nature of the industry. Nor is it a static business. Norwegian Cruise Lines adds about one new ship to its fleet each year.

Having been in her role for more than five years and at the company for more than 11, Lee knows that her success depends on a number of factors, starting with a product experience that “makes people happy and want to come back again.” Lee also primes the marketing pump with travel agent education, amplification in social media and via word of mouth, and, last but definitely not least, good old TV advertising. Ultimately, if you need to fill a lot of ships, you need to reach a lot of people.

Can you talk a bit about the customer journey?

When you think about the customer journey, a term I find annoying but useful, in traveling and cruises, generally we’re in the fortunate business of marketing something that people save their time and their money to do, and they want to plan it all the time. People are dreaming about vacation all the time. We call it “the dream phase”; that phase when you’re thinking about where you are going next, what experience you want to have and who you want to go with. What’s the occasion? There’s all kinds of fun and exciting things that we do to celebrate with travel. And then there’s experiences that we want to collect and have, through travel. We’ve got to find the people who are right for us. When they’re thinking about what they’re going to do, we want to make sure that they’re thinking about and considering a cruise—and a Norwegian Cruise Line, specifically.

How do you market new ships? How far ahead do you start?

We typically start selling a new ship two years before the ship is going to arrive. We’re selling a really fabulous dream. This ship, Norwegian Bliss, is the first ship in North America to launch with a race track on top. It takes you several minutes to get around the track. You can go up to 35 miles an hour. You can really race, it’s electric. So, this is the largest race track at sea but it’s not the first; we launched the first one on our new ship that went to China last year on Norwegian Joy. When you’ve never had a race track at sea before you can imagine it’s very difficult to help people understand what that could be like. And you also can imagine as a marketer, that’s like candy. I mean what story can I not get people interested in that includes a race track on top of a cruise ship?

How did you market a race track before you had one?

For the launch of the first ship in China, we had to build out a full digital experience in terms of renderings and then we expanded upon that when we knew we were going to be launching it in North America. So, we built a full VR experience; you could do it on the website, you could do it with goggles, you could do it on your phone—you could do it however you chose to do it. There was a whole plan around it. It was built out to help with selling travel agents and training them on it so that they would be able to understand it and get their customers excited about it and bring them onboard.

Did the VR experience extend beyond the travel agents?

Yes. We had every version of it that you can think of, from the one that you can just do in your own home to the full implementation that we took around to all kinds of trade shows. With that one, you could sit in the chair and steer and experience either through goggles or on a screen. It was a huge hit. And we produced all the visual assets to make sure that people could tell that story, share it, and get excited about it. And that was amazing. All in advance of the actual ship.

Cruise marketing is often seen as b-to-c, but it’s a lot of b-to-b via travel agents, right?

Travel agents are key for cruises. Cruise is a very considered purchase. There are lots of barriers to people making a decision, not just to leave home and go somewhere else but to leave home, often get on a plane, they have to have a passport because we sail internationally. When you are going on a cruise, you are not going to a new place that doesn’t move; you are actually getting on a vessel that leaves and goes on the water and goes perhaps to multiple places that you’ve never been. We are hugely reliant on the great relationships we have and the great work that we do with travel partners. And we do a lot of work to get the brand across to our partners.

How do help these agents sell NCL?

It’s a big job and we work really hard at it all the time. We have incredibly robust training platforms, like an online university called NCLU which we developed internally with the help of a partner. It was a huge amount of work. You get certified at various levels of expertise that are associated with our brand. There’s just so much you have to learn. If you’ve never traveled to Alaska, or you’ve never traveled to Europe or the Caribbean, our job is to help make you knowledgeable, confident and able to help somebody plan a fabulous trip to any of those destinations.

What role does social media play in your marketing?

Word-of-mouth is basically the number one driver for consideration and purchase in travel and vacation. It’s a highly discretionary purchase and everybody wants validation from other people, or recommendations. How many times have all of us asked, “How was your vacation and would you recommend the place you stayed?” Or, “Have you ever been to this place? Did you like where you stayed? Did you like what you did? Did you like the ship you sailed on?” So, people are constantly looking for recommendations and validation along that decision path. And for us, social media is word-of-mouth on steroids, at a scale that’s monetize-able, that we can use for marketing purposes and track. It’s been just fantastic for our business. It’s a critical area and we continue to look at how to invest in it smartly.

So how do you accelerate the social conversation?

For many years, the travel industry was an early adopter of every type of digital marketing you can think of. Paid search is the one that obviously comes to mind and social is close behind that. We’re very fortunate in that we have tons of content that’s being produced by the people on board our ships who are having fabulous experiences all the time. Our challenge is not how to get the content, it’s how to curate the content. We need to make sure we’re sharing it out in a way that’s meaningful and going to get people interested in us. It’s about sharing the right thing, with the right people, in the right place where they are in their exploration and shopping process. And we have more content than we know what to do with. Fortunately, a lot of the vendors and partners that we work with, they’ve caught up to that. So, it used to be that we didn’t have enough tools to be able to manage that scale. That’s changed and it’s been really helpful for us and our team.

Do you have a couple dos and don’ts for your fellow marketers?

Do the foundational work and do the thinking. Make sure your strategy is right and your target is right. Be very clear on the business objectives and make sure your plan is going to drive to that. Then, invest in content and really great creative because otherwise you’re wasting your money. Don’t spend money on it unless you’re going to make it really great. That’s our job. And another don’t—never let fear be a driver of your decisions.