The Big Interview: Adam Goldstein

Christopher Kanal: Can you give an update as to how your relief efforts are proceeding in Haiti?

Adam Goldstein: We are taking what happened in Haiti very seriously. It is a daunting challenge for everyone and we are very involved. We have a 30-year relationship with Haiti and as one of the main parties involved in the country we need to help. Every RCI ship that is going to Labadee in Haiti is transferring significant amounts of supplies. To date, 16 RCI and Celebrity Cruises ships have called at Labadee delivering more than 160 pallets of food, water and medical relief supplies. In addition, Royal Caribbean has raised more than $475,000 to donate to relief organisations dedicated to helping Haiti.

How do you respond to the criticism you have received for continuing cruises to the country?

I don’t think anybody enjoys public criticism but we knew we were doing the right thing. Everybody in Haiti and everyone in positions of authority related to the aid effort, everybody without exception wanted us to keep going there.

The implication of not going would be to hurt the Haitian people and that did not make too much sense to us. I’m very proud of our efforts and have seconded our staff to Paul Farmer [the UN’s deputy special envoy to Haiti], former president Bill Clinton and the UN Special Envoy Group who are doing a number of projects, including constructing a warehouse and a command and control centre for the distribution agencies to offload and pick up supplies. In time, the Haiti disaster may diminish in public consciousness around the world but it won’t fade for us.

How do you see the cruise industry evolving in the next five years?

The evolution of the cruise industry is going to become more mainstream. In the past, when we talked about cruising becoming more mainstream we were generally talking about the US, now we mean around the world. In every major tourism market cruising is beginning to play a role. In markets such as the UK, it is already playing quite an important role. In almost every developed market, cruising is becoming one of the holiday choices that people are contemplating. In five years’ time the industry will be a lot more global than it is today.

RCI is seeing healthy growth in at least the top 30 countries. I believe that we are the world’s most international cruise line. We win almost every award in the world for the top cruise lines in every market, which demonstrates that we are respected across the globe in the product we deliver to our guests. Our ships are destinations in themselves that we match up with geographical destinations to create a very compelling cruise experience.

There is still enough room in the market for cruise lines to be pursuing their own agendas. The amplification of choices, whether they are land-based or water-based, is astounding today. Cruising is a small piece of that action, and is still collectively only 2% of the holiday market. One of our goals is convincing consumers that cruising will deliver the highest level of satisfaction possible. RCI is able to cater to a global audience and can bring our ships anywhere.

As we speak we have the Legend of the Seas in Singapore, Rhapsody of the Seas in Australia, Splendour of the Seas and Vision of the Seas in Brazil, Brilliance of the Seas in Dubai and Enchantment of the Seas off Colombia. We are able to do these things at a high level and still have the Oasis of the Seas, Freedom of the Seas and Liberty of the Seas doing things that we have traditionally done. We have been growing for 42 years and we expect to continue.

What are you doing to attract a new generation of cruisers?

In the US, we bring out ships that have captivating features so you can have an active, comfortable cruising vacation in your 20s and 30s. If you know Oasis of the Seas, you don’t need to wait until you are older to take a vacation on board. You are going to have a fabulous time right now. In other parts of the world, we are happy to have people of all ages with us, but in general we are attracting an older clientele. It is like what North America was 15 years ago, but today we are saying that cruising is not as you imagined and we are bringing a fresh face to it.

I believe the Oasis of the Seas and Allure of the Seas will contribute towards attracting a new generation. The Oasis of the Seas generated global publicity on a level that was surprising even for us. When the Allure of the Seas comes out at the end of the year, we will have another burst of publicity.

Oasis of the Seas is generating very comfortable revenues despite the economic downturn. Do you see this continuing?

We didn’t have the Oasis of the Seas constructed with the purpose of her coming into service during the downturn, but even now she has done remarkably well. There isn’t anything currently under construction or under contract in the world in terms of cruise ships that is even attempting to compete with the Oasis of the Seas and Allure of the Seas. It will be years until these ships have rivals. They are clearly going to be the flagships for the industry for the foreseeable future. Big works for us. We don’t pontificate and say this is the only way it can and should be done.

So, is big always beautiful?

We like to build multi-faceted cruise ships with lots of options, varieties and choice that allow people to programme their own vacation as they see fit. Our ships are constructed for lots of people to have an extraordinary time and that is what happens. The best thing about the cruise industry is the level of choice on offer. There is an incredible array of options and you don’t have to do the same thing twice.

The Oasis of the Seas and Allure of the Seas are our flagships and exemplify the best expression of our brand. Both are great ambassadors for the industry but so is the Legend of the Seas. Every single time it comes to the Bund in Shanghai, this gleaming white shipper, bigger than anything around her, is an ambassador for the industry.

What is the company’s main financial objective for 2010?

We want to return to at least the level of revenue yields we were experiencing before the downturn as fast as we can. That will clearly take time. It will take more than this year to recover the deficit that we experienced. That is the huge priority. Clearly, we have to operate as efficiently as possible under the circumstances and make sure ever dollar that we spend is for a purpose and guarantees a return.

We don’t take any new ships for granted. The Allure of the Seas needs to be introduced in a very positive way. Like every year, 2010 is full of opportunities and challenges. It is a difficult time economically, but things seem to be getting better so we have a lot of faith in the long-term outlook for cruises.

And what steps are you taking to improve the environmental record?

The industry understands that our environmental record is of the utmost importance. We believe we are world leaders in many respects from our management of waste streams to constantly pushing for greater energy efficiency. But you need to be better tomorrow than you are today.There are always new challenges, whether you talk about improving the ship propulsion machinery, shipboard systems or the way we run from point A to point B.

Everyone can read our Environmental Stewardship Report online because we are incredibly proud of what we do. We explore many avenues but there is big difference between exploring an avenue and contracting to have something on board your ship. I’m pretty sure that in a five-to- 10-year time frame, the cruise industry is going to be involved in opportunities that are very exciting from an environmental standpoint, and we are trying to figure out which ones. There are always people who are not going to be satisfied, but we believe that most reasonable people understand that we do pursue continual improvements and that we do deliver.

Do you have a favourite experience on board the Oasis of the Seas?

Everybody is giving me the credit for the jogging track and the table tennis facilities. I didn’t ask for one but my colleagues know what I like to do and they took it very seriously, so now we have the greatest jogging and table tennis facilities that have ever been on water!