The cruise industry is awash in beverages—and, for that matter, beverage dollars, as the category has become a top profit center for many of the largest cruise lines. “It’s the number one profit center onboard,” says Frits van der Werff, vice president of Food & Beverage Experience for Holland America Line. “That includes everything from shops to shore excursions, casino, spa, and other [services] on the cruise ship. And all of those things are pretty active. But beverages are at the top of the list.”
Cristian Pirvutoiu, senior corporate manager of beverage operations for Celebrity Cruises, has seen similar success with Celebrity’s drinks program. “Beverage represents about a third of the overall onboard revenue we earn annually,” says Pirvutoiu. “It’s a strong area of focus for our brand—culinary is another key pillar—and one of the many reasons guests choose to sail with Celebrity.”
A Shift in Onboard Beverage Programs
The types of drinks that are helping to boost beverage profits, however, aren’t the ones you may have watched bartender Isaac serve aboard The Love Boat on television back in the ’70s. They’re not even the same drinks that were being served on cruise ships just a few years ago. Today’s drinks lists are reflective of broader trends taking place throughout the beverage industry. They’re an increasingly higher-end mix of artisanal cocktails, craft beers, and expert-selected wines. “Where historically you had the umbrella drinks and piña coladas as the major beverages being offered,” says van der Werff, “that now has clearly shifted to more sophisticated wines, rosés, champagnes, cocktails, and craft beers on board our ships.”
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As cruise goers have come to expect this selection of modern beverage choices, it has led the cruise companies to take a fresh look at their beverage businesses. The result: dazzling new bars have been opened, celebrity mixologists and wine experts have been hired, and private-label offerings have become commonplace.
Zachary Sulkes, international key account manager of the cruise channel at Bacardi Global Travel Retail, explains that cruises are a key strategic pillar of the Bacardi Travel Retail business—the division that manages the company’s product distribution on cruises and ferries, in airports, border stores, and inflight. “The importance has been growing in recent years as we see great potential for the global cruise market,” says Sulkes. “Cruise consumers like to enjoy spirits brands they’re familiar with in their domestic market, especially when they’re expertly presented in the growing number of fantastic cocktail bars and experiences offered by the cruise lines.”
And “fantastic” is an appropriate way to describe these onboard drinking establishments. In Holland America’s Gallery Bar, where the walls are lavishly adorned with an eclectic mix of artwork, guests can order their favorite classic cocktail or try one from the cruise line’s signature cocktail menu, created in partnership with Master Mixologist Dale DeGroff. At Holland America’s Notes whiskey bar, 120 whiskey labels are on display. An interactive menu board and multiple tasting options are designed to identify uniquely personalized whiskey flavor profiles for each guest.
Cruise goers who settle down for a tipple in the Rising Tide bar on Royal Caribbean’s Harmony of the Seas are offered a memorable drinking experience—the entire bar slowly rises and descends, traversing different decks of the ship. This same ship is also home to the popular Bionic Bar, where robotic bartenders serve up the drinks. The robots regularly turn out two cocktails per minute and can make up to 1,000 each day.
Pre-Paid Beverage Packages
In many cases, cruise goers have come to identify their cruise vacations as synonymous with a steady supply of refreshing poolside cocktails and other liquid enhancements, such as having a glass of wine in hand when taking in the breezy sunset. And the cruise industry abides, with most lines offering an array of pre-paid beverage packages that help soothe the cost of what might otherwise add up to a pricey bill.
“For those that like to plan ahead and just kick back and relax once on vacation,” says Celebrity’s Pirvutoiu, “it’s [easier].” Like many lines, Celebrity offers several tiers of beverage packages, from a lower-priced option that starts at $45 per night and covers more standard drinks to a more premium option starting at $69 per night.
Some of the companies are taking advantage of another trend—that of partnerships with big name mixologists or wine experts—to further upsell their beverage packages. For example, Holland America recently introduced a new Elite Beverage Package that opens purchasers up to DeGroff’s collection of unique, classic cocktails, such as The Ritz Cocktail, The Hemingway Daiquiri, and Midnight Sun, his latest creation, which celebrates Holland America’s 70th year exploring Alaska. The company also recently named the renowned wine critic James Suckling as its wine curator.
Beverage directors say such pre-sold packages—which started becoming commonplace in the industry about a decade ago when the cruises began opening specialty restaurants and bars onboard—have been a huge hit with customers. “It’s a win-win for our company and our guests,” says Giovanni Guido, the MSC Cruises corporate F&B director for the USA and Caribbean. He says it helps remove the element of sticker shock from a guest’s cruising experience. Guido adds that around 70 percent of MSC Cruises’ guests elect to go with a pre-paid beverage option when signing up for their cruise. “That’s a huge amount of guests.”
A Unique Set of Challenges
One of the uniquely challenging issues for the cruise lines is offering a beverage program that by necessity needs to be managed top-down from a head office somewhere but that also retains an element of being local and distinctive to the particular voyages the ships take.
As Andrea Sugranes, a spokesperson for Norwegian Cruise Line, explains: “Norwegian Cruise Line offers different beverage experiences for guests depending on the destination the ship is visiting.” For example, she says, guests get the opportunity to try Gosling’s Rum in Bermuda when cruising to the island from New York in the summer and they can enjoy beers from Alaskan Brewing on the company’s Alaska destination cruises. “We’ve also partnered with Bacardi and other rum distilleries when travelling to the Caribbean,” she says. “[The beverage program] changes seasonally and annually.”
Van der Werff points out that the biggest challenge for his cruise line’s beverage program is global availability of products. “If we have a ship that leaves Fort Lauderdale today and is not returning to the U.S. for the next six months or maybe even longer,” he says, “it becomes a challenge for us logistically and purchasing-wise.” Holland America calls on more global ports and destinations than any other cruise line—400—says van der Werff.
Bacardi’s Sulkes says that as a global supplier to the cruise industry such scenarios provide his company with some advantages. “There are specific logistical issues with cruise lines in terms of space onboard and a fragmented route to market,” he says. “As such, the cruise lines need the assurance of working with drinks companies, like Bacardi, with an established supply chain in multiple locations and a diverse portfolio of popular brands with fast sell-through rates.”
Wine- and Spirits-Focused Extras
On longer voyages, beverages often take on another important role—as part of the onboard activities. These include mixology classes, spirits and wine tastings, and many other such events. Celebrity, for example, collaborates with Riedel on a wine glass comparative workshop. The experience includes a packaged tasting set of four Riedel glasses that gets shipped to each guest’s home address.
At Norwegian’s The Cellars—A Michael Mondavi Family Wine Bar, guests can engage in hands-on educational wine activities. There is a wine aroma seminar, a wine and chocolate pairing, and a Black Glass blind-tasting class in which guests explore the differences between white and red wines.
Private label has also taken on new importance, helping to establish the cruise lines as beverage experts themselves. MSC offers a wine collaboration with a famous celebrity—the Italian singer Andrea Bocelli, whose family has been making wine since 1831. Guido says the Bocelli family’s background was a good fit with MSC’s own history of family ownership, and the European feel of its cruising that distinguishes it from other American cruise lines. “This is the kind of partnership that we want,” says Guido, “where we can assure that we have genuine people—family people—that really relate with what we do at MSC.”
A relative newcomer to the U.S. market, MSC plans to launch 10 new ships by 2026, further evidence of how rapidly the cruise industry continues to grow. In fact, according to Bacardi, cruise is the fastest growing channel in the travel retail industry, with significant incremental growth in established markets—and also the development of several new markets, especially in Asia Pacific.
For a beverage supplier like Bacardi, it’s a strategic channel to be closely aligned with. An important part of its partnership with the industry is the Bacardi Legacy Cruise Competition, which recognizes the best bartenders in the cruise industry—and helps coach them in the process of creating their own signature cocktails. The competition attracts thousands of entries every year, and this year’s winner, Shekhar Grover of Royal Caribbean International, went on to reach the top 16 in the drinks industry-wide Bacardi Legacy Bartender of the Year 2018 competition in May, where he competed against many of the world’s top professional bartenders—an accomplishment that would surely make The Love Boat’s Isaac quite proud.
Andrew Kaplan is a freelance writer based in New York City. He was Managing Editor of Beverage World magazine for 14 years and has worked for a variety of other food and beverage-related publications, and also newspapers. Follow him on Twitter at @andrewkap.