Rise of Alternative Business Models in the Era of Expensive Megaships

Abstract

Ships build the main structure of cruising businesses of any kind. Their technical attributes are determined in advance to fulfill the long-term business strategies of their respective operators. However, decision-making in terms of new orders will increasingly become an issue, as it is expected that two future trends will be inconsistent: ships growing in size (costs per ship) and the increasing pace of future changes (market uncertainty). This paper discusses the position of the ship among the cruising business architecture and compares it to similar business concepts with alternative enterprise policies and stakeholder-network arrangements. The alternative businesses are categorized in four models: Onboard Hospitality and Entertainment (OHE) Condominium/Residential Model (CM), Shore To Shore Floating Services (SSFS) and Limited Onboard Involvement (LOI). The models are then compared with each other through a Morphological Analysis (GMA) based on the role of the ship in their respective businesses. Multiple scenarios are generated, ranked and interpreted to demonstrate which configurations of different ship attributes will best match to the studied business models to be driven by cruise companies. The scenarios picture a 15 years perspective up to 2030. The results can be utilized by cruise providers as a business expansion strategy or a stock of alternative plans in case of a market shock.