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In annual ritual, cruise ships bring big business back to Juneau

Pat Forgey
Michael Penn

JUNEAU -- Every spring, residents of Alaska's capital city look forward to a breather in the time between when the politicians and lobbyists leave downtown following the legislative session and the tourists begin pouring in.

This year, they got the town to themselves for about half a day.

What with the Legislature unable to finish its business as scheduled, and the wholly unscheduled arrival of the cruise ship Volendam the next day after a weather diversion, the seasons of Juneau's two most prominent industries abutted like never before.

When the Volendam popped in after storms diverted it from its planned stop in Kodiak while returning to the U.S. from Japan, the businesses that were already open made the most of their good fortune. The Holland America ship's 2,000 passengers and crew -- and their spending money -- were welcomed to town with open arms, even though some businesses had to scramble to be ready.

Last year Alaska got almost 1 million cruise ship visitors, nearly all of whom passed through Juneau, the state's top cruise port.

This year it is expected to be down a bit, but the locals are expecting a good year anyway.

"I just think the economy has gotten a little better in the last year and they're not discounting the cruises as much as they did in the past," said Bob Janes, owner of Juneau's Gastineau Guiding.

"They're getting people willing to spend a little more on the cruise, and the shore excursions," he said.

The Alaska Division of Economic Development's tourism section said the industry expects 972,000 cruise passengers this year, down from last year's 999,600.

"It's basically the same number of boats, but slightly fewer berths," said Nancy Woizeschke with the Juneau Convention and Visitors Bureau.

Among the changes this year, she said, are newly scheduled visits by Carnival Corp.'s Crown Princess, with a capacity of more than 3,000 passengers and the largest ship to call in Alaska this season.

Also passing through is the company's Pacific Princess, which is much smaller, with capacity for 350 passengers, but is also one of the Princess Line's most luxurious and expensive vessels.

All of that bodes well for the season, Woizeschke said, and things are looking up in the first few weeks.

"A lot of times they discount significantly to get people up here in the early weeks of the season, but we haven't seen that as much (this year). As a result, it seems like people are willing to spend a bit more when the get off the ship."

In downtown Juneau, Caribou Crossings owner Tanja Cadigan said her shop was seeing that already in its customers and looking forward to a great year despite the decrease in berths.

"The passengers have just been incredibly enthusiastic about being here and wanting to get the full Alaska experience," she said. "I think we're getting a higher quality passenger, they're really engaged in being here."

lucrative destination

Carnival Corp. executives told Wall Street analysts recently that occupancy on Alaska cruises was running well ahead of alternative destinations such as the Caribbean, which likely means higher prices later in the season.

Royal Caribbean Cruises, parent to both Royal Caribbean Line and Celebrity Cruises, went even further. It's the state's second largest cruise company, behind Carnival, and said that Alaska was a key market during its highly profitable summer months.

"We expect Alaska yields to increase in the low to middle single-digit range and to be similar to yields in our record 2011 season," said Michael Bayley, Royal Caribbean's president and CEO, according to a transcript on the SeekingAlpha.com investment website.

They're already seeing it performing well, especially in what cruise lines call "onboard" spending. That's the extra revenue cruise companies charge beyond tickets, and it includes a share of shore excursions, which in Alaska include glacier tours, whale-watching and flightseeing that are booked on the ships.

Bayley said the company is seeing room to make even more money there, and expects Alaska to be its most profitable itinerary again.

One of the reasons Alaska's so profitable, Woizeschke said, is "multi-generational" travel; kids, parents, grandparents, even great-grandparents that enjoy what Alaska has to offer.

"For a lot of them, it is a trip of a lifetime, taking their family on some of the larger, traditionally a little bit more expensive excursions," she said.

"People like to go in big groups, and do big fun things together," she said.

For some local businesses, rather than hoping for the luck of an extra Volendam visit, they're making their own luck by finding ways to target that youth-oriented market.

When Disney began sending its family-friendly cruise ships to Alaska, the company wanted Gastineau Guiding to offer excursions for kids as well.

"We do whale-watching with a science twist where we take some measurements and gather some information for a couple of agencies here in town," said Gastineu Guiding owner Janes.

They also do some pulling up crab pots to check for invasive species, and provide information to NOAA and the University of Alaska Fairbanks, he said.

Other cruise companies beyond Disney have sought out that type of tour, because customers want it, Janes said.

Reach Pat Forgey at pat@alaskadispatch.com.

 


By PAT FORGEY
pat@alaskadispatch.com