This Guide has been specifically designed to assist businesses to achieve effective engagement with the Region s growing cruise ship industry.

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2 ALL ABOARD Welcome to the Townsville Enterprise Cruise Ship Industry Guide, a practical resource for tourism businesses interested in engaging with Australia s cruise ship industry. Townsville Enterprise is the peak economic development and destination marketing organisation for North Queensland. Townsville Enterprise identifies, develops and leads, or supports as appropriate, strategically important projects and lobbies for sustainable economic growth. We position North Queensland as a dynamic and diverse regional economy and destination to attract investment, tourism and business events. Townsville Enterprise is dedicated to creating economic growth in a responsible and sustainable way for the benefit of members, investors, visitors and residents. Our focus is based on the future growth of the North Queensland Region that will in turn benefit our members and the broader community. This Guide has been specifically designed to assist businesses to achieve effective engagement with the Region s growing cruise ship industry. The following pages contain a collection of practical resources and tools for better understanding how the cruise ship industry operates, identification of the key industry stakeholders involved, and how to appropriately position your product or service so you can effectively participate in our Region s cruise ship industry. Townsville Enterprise encourages operators to get on board with the cruise ship industry and to utilise the knowledge and resources within this Guide. Photo courtesy of Tourism Queensland

3 THE AUSTRALIAN CRUISE SHIP INDUSTRY IS BOOMING! The latest research from peak industry body Cruise Down Under identifies that the direct expenditure (including domestic and international passenger and crew and operator expenditure) associated with the cruise shipping industry in Australia was estimated at $789.6 million, compared within $682.7 million in This equates to a 15.7% increase in the year, with the increase explained by a higher number of base port visits which resulted in higher passenger and crew expenditure as well as significantly higher port related expenditure. 42 different cruise ships visited Australia in compared to 34 ships in Cruise ship passenger capacity has increased to 49,254 in from 41,803 in Port related expenditure increased from $364.5 million in to $440.6 million in QUEENSLAND The Brisbane cruise ship industry recorded economic impacts as follows: $338.1 million total expenditure in Mackay/Whitsundays and Hamilton Island recorded $12.15 million total expenditure from the industry in Townsville recorded $1.8 million total expenditure from the industry in Cairns, Cooktown, Port Douglas and Thursday Island recorded $16.2 million total expenditure from the industry in PROJECTED INDUSTRY GROWTH In the cruise ship visits to Australian ports are expected to increase by approximately 180 to an estimated The projected strong growth in takes the number of port visits back to the historical trend. Growth is projected to be driven by the Easter Seaboard capital cities of Sydney (+74 visits), Brisbane (+39 visits) and Melbourne (+20 visits). Other ports expected to record strong increases in include Hobart, Broome, Burnie and Fremantle. Several cruise ships will be based in Australia either permanently or for part of the year. This expected increase will likely lead to a significant increase in passenger and crew expenditure in Australia and associated economic impact. CRUISE DOWN UNDER Cruise Down Under (CDU) is the cooperative marketing brand for cruise destinations and the service providers to the cruise industry in Australia and the South Pacific. CDU is dedicated to making Australia and the region a major world class base and destination for cruise ships. CDU is a member-based organisation comprising of Australian ports, tourism agencies, cruise lines, shipping agents, inbound tour operators and companies associated with the cruise shipping industry in Australian and the South Pacific. VISION Develop the Australian, Asian and South Pacific region as a major world class base and destination for cruise ships. For more information please visit:

4 Townsville North Queensland building for success Despite the State s impressive growth, Townsville receives less than one in every 15 cruise visits to a Queensland port. In , only 5% of cruise passengers visiting a Queensland destination came ashore in Townsville. The planned development of a dedicated cruise berth in Townsville is a key element for future growth of this industry to Townsville. Townsville s unique geographical location and abundance of surrounding natural assets provide our industry with an opportunity to capitalise on the growth of the cruise industry and increase the value of cruise tourism to North Queensland. In , Townsville welcomed a total of seven cruise ships. Tentative cruise ship bookings for 2012 indicate that a total of 10 cruise ships are expected to visit Townsville over this 12 month period. Consistently delivering outstanding port calls for cruise passengers is vital to the success of a cruise destination. Ships Agent Industry coordination is the key With Townsville s cruise ship industry on the rise, the need for greater industry coordination is clear. Townsville Enterprise has an important role in attracting cruise lines and coordinating cruise ship visits with the Port of Townsville, the Great Barrier Reef Marine Park Authority (GBRMPA), Local Government and Visitor Information Centre Volunteers. Townsville Enterprise will work with North Queensland businesses to see how we can help you get on board this growing market. Our region currently offers only a small number of cruise shore excursions. An opportunity exists to expand this range and better cater to existing and potential new cruise ships and their passenger needs. Building on our strengths presents fantastic opportunities for proactive operators in Townsville.

5 HOW TO GET INVOLVED Cruise ship visits are planned well in advance. Being a part of a cruise ship visit can deliver additional customers to your business, however, getting involved requires appropriate planning. THERE ARE TWO WAYS TO GET INVOLVED: BE A PART OF A PRE-DETERMINED SHORE PROVIDE AN EXPERIENCE TO PASSENGERS NOT 1 EXCURSION THROUGH A GROUND HANDLER 2 PRE-BOOKED ON A SHORE EXCURSION Most of the cruise lines visiting Australia use a ground handler to keep them up-to-date with tours and activities a particular destination can offer their cruise ship passengers. Information provided by a ground handler plays an important role in determining whether or not a cruise line develops an itinerary inclusive of a particular destination. What is a ground handler? A ground handler is a specialist who designs suitable shore excursions by packaging a range of products from a particular cruise destination and on-sell these tours/activities to cruise lines for sale on board the ship prior to arrival at the destination. The ground handler is responsible for arranging any necessary transport, catering arrangements and support to be able to ensure that passengers are getting a good experience and value for money. The ground handler acts as a central point of contact between a destination s tourism operators and visiting cruise ships should a potential unforeseen incident occur. The ground handler negotiates rates with product suppliers when designing the package, which can be up to 18 months prior to a visit. OPERATOR TIP: You need to promote your product to a ground handler at the right time. The cruise season is November to March. Make contact with a ground handler in October and follow up in March for the potential inclusion of your product in the following year s schedule. Responding to requests for pricing and more information in a timely manner will increase the likelihood of your product being included in a cruise ships shore excursion program. The various ground handlers operating in Townsville can be found in the Cruise Industry Contacts section within this Guide, or by contacting Townsville Enterprise.

6 Not every cruise passenger goes on a shore excursion when visiting a destination. The majority, approximately 80%, do at some point along their journey, and of those, 75% participate in pre-arranged tours/activities, leaving a significant number of individuals who are Free Independent Travellers (FITs) who do their own exploring. On any given cruise ship visit around 30% of passengers go on a shore excursion, 30-40% do their own thing and 30% stay on board the vessel. Only 5% book a tour direct with an operator and don t go through the cruise line and this is actively discouraged to ensure passengers arrive at the deck on time for departure. OPERATOR TIP: While you may not receive notification of the final passenger numbers for your shore excursion until close to the day, you can ask your ground handler to send you regular updates of booking numbers and don t be afraid to discuss a cancellation policy. It is possible to over-package, most cruise lines want only one-two products in a half-day tour and three-four in a full day tour. FITs need quality information delivered on the day by volunteers at the cruise ship information desk. Be sure your product is being promoted to these passengers by supporting Townsville Enterprise. We discourage businesses from trying to approach us (a cruise line) directly as we get hundreds of these approaches and the majority simply finish up in the round filing cabinet under the desk Cruise Line Understanding commissions The cruise industry works in a similar way to mainstream inbound tourism when it comes to working with operators on pricing. The cruise line, its sales agent, and the ground handler need to receive approximately 10-15% commission to sell your product to their customers. This adds up to 20-25% commission overall which needs to be included in the sales price of your product. You will need to honour the distribution system by not selling your product at a discounted price (i.e. minus commission) through other avenues such as your website. It is better to offer cruise passengers a value added experience (e.g. back of house tours) not offered on your website or in brochures so there can be no price comparison and it is a unique and special offer. OPERATOR TIP: Be sure to allow for a 20-25% commission on your product price for international distribution through the ground handler and cruise line, similar to selling your product through an Inbound Tour Operator (ITO).

7 PLANNING AHEAD The diagram below illustrates the various relationships in planning, coordinating and facilitating a cruise ship visit. The cruise lines plan their itineraries around 18 months to two years in advance. Cruise itinerary planners identify which destinations they will travel to using information provided through customer feedback surveys, information from the shore excursions team and most importantly the logistics of shipping calls including transit time. Industry & Government Groups Promote Australia as a destination and the ports within it to cruise lines, e.g. Tourism Australia, Tourism Queensland, Cruise Down Under, Townsville Enterprise Regional Tourism Organisation (TEL) Coordinate the logistics of a cruise call from the destination point of view including volunteers, information and welcome party/meet and greet E.g. Townsville Enterprise (TEL), Port of Townsville, Shipping Agent, Chamber of Commerce and Ground Handlers Ground Handler/Tour Operator Provides desination information to a cruise line on what s new and what has been successful in the past to help with itinerary planning Proposes specific tour and activities programs 12 months prior to a visit Manages shore excursion logistics and some passenger exchanges Cruise Lines Commence planning 2-3 years before planned call Set an itinerary (18 months prior) Set a shore program and sell it to customers either at booking or on board (12 months prior) Bring passengers to the destination The Customer Operators and the Destination Through the ground handler, advise the ship of things to see and do in the days leading up to the visit (cruise news) Provide visitor information on the day Provide destination experiences either onshore excursions or to passengers on self - guided day excursions Ship Agents Provide port and logistics information relating to berth/anchorage Make bookings for berth/anchorage and support services i.e. Customs and Quarantine Source: adapted from Tourism Queensland (2005) Cruise Destinations - a How to Guide

8 PLANNING DIAGRAM 18 months prior to a visit Itinerary is planned Contact Townsville Enterprise to find out which ships are planning calls and the ground handlers for those vessels. Knowing the vessel type, passenger type and timing of the call should influence the product you offer. Pre Arrival months prior Shore excursions are planned Contact the ground handler for the vessel and let them know you want to be included in the shore excursion program. You will need: To fit within a half-day and full day itinerary (new or existing) A price that includes commission for the ship and the ground handler Appropriate public liability insurance To know the maximum and minimum number of people you can carry Shore excursions confirmed You may need to negotiate on price, number of passengers you can carry, cancellation policy, or other details. 6 8 months prior The ground handler will let you know if you are included in an itinerary and you should run through the logistics of your itinerary to confirm all details. 2 3 months prior If your product is not included in formal cruise line shore excursion program you will need to brief Townsville Enterprise on the experience/product you wish to promote to FIT passengers not pre-booked on a shore excursion on the day. 1 2 days prior The Ship via the ground handler will confirm the final passenger numbers participating in you shore excursion. THE DAY Be sure you are ready for all possibilities! Post Arrival After the call Ongoing Seek feedback from the ground handler about your product and potential ways to improve upon your passenger experience for next time. Maintain contact with the ground handlers and Townsville Enterprise to plan for future cruise ship visits and raise awareness of your product with the various cruise lines.

9 CREATE AN ATTRACTIVE SHORE EXCURSION What makes an attractive shore excursion? It all starts with the customer. Cruise line itinerary planners talk to one another, and a good or bad experience at any destination is generally known by most of the cruise industry within a very short time. Destinations or shore excursions that gain a low customer feedback rating will be reconsidered in the development of future itineraries. Itinerary planners are looking for diversity of experience for their passengers. So if the vessel has called into Cairns the day before and visited off-shore reefs they will be looking to create a different experience in Townsville...whatever it is, it needs to be different to the day before. Ground Handler Factors influencing the selection of shore excursions Every cruise line itinerary and shore excursion program is scrutinised for its revenue potential by cruise lines and unless they meet a specific criteria they are not accepted. The development of a shore excursion that considers the nationality, age, special interests and number of passengers associated with a specific cruise ship, will have more likelihood of being included as part of that cruise ship s shore excursion program in comparison to one that has not. There are a range of factors cruise lines take into account when evaluating an itinerary and the individual products included within that itinerary. These include: OPERATOR TIP: Appropriate health and safety standards and insurance is paramount Commissionable product with available nett rates two years in advance A high degree of flexibility (situations arise where flexibility is required) A commitment to quality A 3-4 hour return travel time from the cruise vessel A unique product something the passengers can brag about An experience complimentary to other experiences offered at the destination An experience that fits the needs of the passengers specific to that cruise ship Tour structure and size Previous positive feedback (past passengers and/or crew members) Careful consideration should also be given to a cruise ship s designated time in port and the various destinations previously visited as part of its overall itinerary. OPERATOR TIP: Some passengers prefer to return to the ship at lunchtime and will therefore look for two half-day itineraries.

10 MAP OF THE IDEAL SHORE EXCURSION AREA regional uniqueness Townsville s reputation as a tourist destination is continuing to grow and this is set to persist as more of the Region s iconic, natural attractions are opened up for discovery. North Queensland offers a unique blend of natural environments including tropical islands and the Great Barrier Reef, dry tropical and seasonal wetlands, wet tropics, cool upland rainforests, grazing lands, savannahs and gorges. In terms of the built and cultural environment the region offers the largest city in tropical Australia, small regional towns with rich migrant history, numerous heritage buildings, agricultural areas, a true Outback, abundant Indigenous history and art, and some of the most active events and sporting culture in Australia. The development of innovative packaged shore excursion products that clearly differentiate our Region s unique characteristics will further strengthen Townsville s position as a desirable cruise destination. CASE STUDY Ideal travel time = less than 3hrs return Maximum travel time = less than 4hrs return Alaska is one of the world s busiest cruise destinations. Its ability to maintain its competitive edge as a cruise destination has often been attributed to its ability to continually develop new, innovative shore excursions. Over the last few years, the number of Alaska cruise excursions and activities available for cruise passengers has doubled. Today, shore options are focusing more than ever on adventure and outdoors activities: kayaking, bicycling, dog sledding, river rafting and sport fishing are possible in the scenic wilderness of this great state, alongside more traditional tours focusing on culture and history.

11 UNDERSTANDING CRUISE PASSENGERS CRUISE LINES ARE LOOKING FOR OPERATORS WHO UNDERSTAND THEIR MARKET AND HOW IT DIFFERS FROM OTHER FORMS OF TOURISM To successfully engage your product as part of a visiting cruise line s shore excursion program it is important that you are familiar with the different types of cruise vessels and the various needs of their passengers. HOW ARE CRUISE SHIPS DIFFERENT? Cruise ships come in all different shapes and sizes. Generally, a cruise ship is defined as a vessel undertaking scheduled, deep water cruising of two days or more with a passenger capacity of 100 or more. They can be themed for a particular nationality or age group, or may carry up to 5,000+ passengers and can be engaged in voyages ranging from two days to 120 days. Those visiting Australasia can be generally divided into four broad categories: TYPES OF CRUISE VESSELS - Expedition Cruise Ships are characterised as smaller vessels which can access more destinations and because of their size have the lowest infrastructure demands and impacts. This class is also generally characterised by higher passenger return visits and higher base port spends. - Boutique Cruise Ships are often small, require top quality excursions and services, and often have the highest passenger spend rate, due to their focus on the higher yield passenger market. - Mid-sized Cruise Ships have greater port infrastructure demands, requiring greater channel depths and generally requiring wharf berthing. Their size generates demand for a destination to offer a variety of shore excursion products. - Mega-sized Cruise Ships are the largest cruise vessels and require significant port infrastructure including greater channel depth, longer wharfs for side berthing, air space under bridges and high quality terminal facilities with baggage handling and international passenger processing facilities. Cruise ships also can be categorised based on their passenger capacity. Although passenger capacity does not necessarily define the cruise vessel, it does provide an indication of the market segment serviced by the vessel. There are typically three different types of cruises a cruise vessel will undertake. These include: - Base Porting regular return voyages from a base to various ports and returning (e.g. P&O Cruises from Brisbane or Pacific circumnavigations). - Repositioning Cruise moving a vessel from one port to another. - Round the World extended voyages through various ports in season (e.g. Northern and Southern cruising).

12 who is the average cruise passenger? Cruise passengers coming to Australia and the South West Pacific visit other destinations including Fiji, Noumea, Vanuatu, New Caledonia, New Zealand, Papua New Guinea and Bali. Tourism Queensland research indicates that passengers visiting Queensland on international transit calls can be described as follows: CRUISE PASSENGER EXPENDITURE 32% were aged 55 to 64 years 40% were aged 65 to 74 years Based on research in Queensland, daily passenger 15% were aged 75+ years expenditure in Queensland destinations can be 75% were retired estimated to be about $150 - $200 per passenger. 44% were males and 56% were females The top three source markets for cruise passengers were Europe, the United States and Australia. Other Queensland destinations often included in the same cruise line itinerary as Townsville are Brisbane, Fraser Island, Whitsundays, Cairns, Port Douglas and the Torres Strait. While food, accommodation and some entertainment are included in the ticket price, cruise passengers also spend money in the destinations they visit, primarily on taking excursions and shopping. Crew members also make a significant contribution to a destination as they take advantage of their off-duty time to go ashore and experience a destination. OPERATOR TIPS: Cruise passengers can be very internet savvy and will often research the costs associated with a shore excursion before choosing to participate. If your product s last minute internet special rate is cheaper than the rate offered on the cruise ship, passengers will see no value in booking your product with the cruise ship and you will potentially lose this valuable business. Make sure the product you offer to cruise lines is unique. To differentiate your product from what you would offer normal visitors, value-add to it where possible, so that cruise passengers do not receive the same experience if they were to do it as a FIT. If you are selling souvenirs to cruise passengers it is important to remember to check with the Australian Quarantine and Inspection Service (AQIS) about quarantine restrictions. what is a cruise shipping agent? Shipping agents represent cruise lines in a particular country or port for all matters relating to cruise ship visits. They secure berths and anchorages, arrange for stores and bunkers and organise for Customs and AQIS to visit the vessel. Long term associations turn into trusted relationships and many cruise lines rely extensively on their agents to provide them with market intelligence and advice on what is happening locally. Shipping agents pay client disbursements and reclaim them along with a fee for services rendered. The success of a cruise ship visit rests on the ability of a destination to bring together a number of factors on the day of a ship s arrival.

13 LOCAL CONTACTS Contact Phone Website Townsville Enterprise Limited Great Barrier Reef Marine Park Authority Port of Townsville Townsville City Council Burdekin Shire Council Charters Towers Regional Council Hinchinbrook Shire Council Townsville Chamber of Commerce CRUISE INDUSTRY CONTACTS Contact Phone Website Ships Agents Carter Marine Agencies P/L Australian Shipping Supplies Inchcape Shipping Services P/L Wilhelmsen Ships Services Ground Handlers The AOT Group (AOT) Abercrombie & Kent (Australia) P/L Select Tours Australia Australian Shoreside Management P/L General Travel Australia Orion Expedition Cruises Bob Wood Cruise Group Industry and Government Tourism Australia Tourism Queensland Cruise Down Under FURTHER ENQUIRIES CONTACT TOWNSVILLE ENTERPRISE Ph: Fax: Website: Disclaimer: Whilst all care and diligence have been exercised in the preparation of this report, Townsville Enterprise Limited considers the accuracy of the information contained within as industry best practise and accepts no liability for any loss or damage that may be suffered as a result of reliance on this information, whether or not there has been any error, omission or negligence on the part of Townsville Enterprise limited or their employees.

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