Sunday, October 10, 1999

River cruise industry growing fast

Tall Stacks fever a glimpse of future?

The Cincinnati Enquirer

        The 900,000 people expected for Tall Stacks '99 this week should paint a vivid picture for local tourism officials wondering about the spending power of inland waterway cruise ship customers.

        Industry experts say that group is an affluent, fast-growing and diverse sector of vacationers with plenty of disposable income and plenty of time to go shopping in towns like Cincinnati.

        That view is not lost on planners rebuilding the Cincinnati riverfront.

        “We are and will be positioned as a great gateway for cruise tourists,” said Rick Greiwe, president and chief executive officer of the advocacy group Downtown Cincinnati Inc. and director of Tall Stacks. “In three to four years, the empty-nester will be a target market on a number of fronts.”

        Downtown's Ohio River shoreline early next century will have everything needed to attract tourists, Mr. Greiwe said.

        “A (National Underground Railroad) Freedom Center that provides education and entertainment. We will have the home of professional baseball in a retro-ballpark. The Banks (development plan) promises to bring a residential quality to the riverfront — a neighborhood setting where visitors can stay in a boutique hotel and sip a cappuccino from a cafe overlooking the river,” he said.

        “It will have all the qualities for visitors hoping to stay for a night after or the night before a cruise.”

        The cruise ship customer has traditionally been a wealthy middle-aged tourist or senior citizen who heads to sunny southern climes for rest and relaxation. But these days, in increasing numbers, cruisers are seeking the repose of an inland riverboat to relax and bask in the nostalgic atmosphere of an America from another century.

        They are not afraid to spend either — paying an average of $260 per night for a Delta Queen cruise.

        For the industry, another demographic is creeping into the equation.

        Cruise customers are getting younger, said Karen Bohning, spokeswoman for the Cruise Line International Association. That is the marketing arm of the North American Cruise Industry, a 23-member trade group based in New York City.

        “We are continuing to see senior citizens on cruises, but increasingly we are seeing people on board who are 27 to 35 years old,” Ms. Bohning said. “People have such hectic schedules that many can't take off for a week or more so they take three to five days for a trip. That is the largest growing market.”

        Mr. Greiwe said that because Greater Cincinnati is a Delta Air Lines hub and is linked to most Midwestern cities through Comair, the community is ready to serve as a port for even more cruises.

        Chicago-based American Classic Voyages Co., parent of the Delta Queen, Mississippi Queen and American Queen, found last year that its Queen line of ships has a recognizable brand worldwide. In August 1998, the company chartered a European riverboat on the Danube River to market a new itinerary to past passengers — a European ""Delta Queen” vacation.

        It sold out in days.

        That does not surprise Mr. Greiwe. Nightly photos from Tall Stacks are extremely popular among CNN's international viewers, he said.

        In 1999, ships with the Delta Queen Steamboat Co. will make a total of 23 stops in Cincinnati, compared with 13 in 1998 and 13 in 1997. It is an increase credited to the American Queen returning to the Ohio River, said Terri Monaghan, vice president of corporate communications for Delta Queen Steamboat Co. and American Hawaii Cruise.

        She estimated that $100,000 is spent in direct purchases in Cincinnati by the company each time the Mississippi Queen and the American Queen arrive. About $50,000 is spent when the Delta Queen arrives. Most of the spending is for food, laundry, water, fuel and trash.

        Next year, the company projects it will spend $2 million in Greater Cincinnati on its purchases and bring the city untold expsoure through advertising, publicity and a network of travel agents that promote the company's products and cities visited.

        “That does not include the ripple effect of money spent by passengers and crew on food, attractions, hotels and merchandise,” she said.

        The American Queen has up to 436 passengers and 180 officers or crew members. The Mississippi Queen has up to 416 passengers and 156 officer or crew members, and the Delta Queen accommodates 174 passengers and 75 officers and crew members.

        American Classic Voyages plans to triple the size of its mainland fleet in upcoming years by building five small coastal ships with turn-of-the-century decor to symbolize the elegant transportation options of New York and New England from the 1840s to the 1930s.

        The eastern seaboard and scenic ports in northern California and the Pacific Northwest are under consideration. Two 1,900-passenger ships costing $440 million each are under construction for a Hawaiian itinerary for 2003 and 2004.

        Beth Burson, leisure products industry analyst with ABN AMRO Inc., a securities firm based in Chicago, said the demographic bubble that has lifted cruise ship revenues through the 1990s is not going to pop anytime soon.

        “That is more than a few years away,” she said. “This is one demographic group that is growing substantially. And not only that, there's an untapped amount of people interested in cruising who've never done it before. In that age group, 50 percent of the people have never taken a cruise before.

        “Once they take a cruise, there is a 60 percent likelihood that they will cruise again within the next three years. So the growth is not just for a few years — but well beyond.”

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