Virgin Voyages ចាប់ដៃគូជាមួយ Starboard របស់ LVMH នៅពេលដែល Harding+ Walks Away

Specialist cruise retailer Harding+ will part company with Virgin Voyages in stages between April and July this year, in order to cut its losses after a difficult launch period for the British cruise line. LVMH-owned Starboard Cruise Services will take Harding’s place later this year.

The switch comes just as Virgin Voyages is set to add another two ships to its current two-strong fleet, and the situation will be disappointing for both parties which have been partners for six years.

When billionaire entrepreneur Richard Branson first announced he was entering the cruise business with Virgin Voyages ត្រលប់ទៅ 2014, there was huge excitement. The Virgin brand is synonymous with originality and creative flair, and the new line was expected to shake-up a somewhat predictable and staid cruise business.

Unfortunately for Virgin Voyages, the Covid-19 pandemic came along at the worst possible moment, just as its first ship, the 2,700 capacity Scarlet Lady, was ready to launch in March 2020. The debut ត្រូវបានលុបចោល and it wasn’t until August 2021 that the vessel made its maiden voyage.

True to form, Branson brought novelty and an edge to the offering. Among the line’s firsts at sea were: ocean vacations exclusively for adults (targeting hip travelers 18 and older), banning the traditional buffet, risqué cabaret acts, and an all-inclusive price covering more than 20 eateries, gratuities, wifi, essential drinks and group fitness classes.

From a retail perspective, the same rules of unconventionality applied. Harding began its planning way back in 2017 marking out the cool cruise customer that Virgin Voyages wanted to attract. Scarlet Lady មាន vinyl record store onboard featuring limited editions, the first MAC Cosmetics store at sea, as well as a karaoke studio, plus products from the late punk fashion icon Vivienne Westwood.

In line with Branson’s sustainability push, Virgin Voyages also insisted on purpose-driven brands and Harding+ secured a number of ethically sourced labels. For example, Coral Eyewear’s trendy sunglasses made from recycled ocean plastics and hand-woven hammocks from Yellow Leaf which are on every Sea Terrace balcony and also sold on board.

Time for tough decisions

Sally Barford, Virgin Voyages’ associated vice president of hotel partnerships, said: “We’ve enjoyed an incredible partnership with Harding+ and their team, but we’ve mutually decided that it’s time for both brands to explore what’s next.”

Harding’s CEO James Prescott added that while it was “great fun” leading the cruise retail proposition it was also necessary to “make some tough choices around what’s right for business.” In Harding’s case, it appears that its core private equity backer could not wait any longer for returns that were originally blown out of the water due to the pandemic. Prescott added: “We wish everyone at Virgin Voyages the very best, and will be working hard to redeploy the Harding+ team members who have been part of the Virgin ship teams.”

Harding’s decision to depart comes after a six-year partnership, but one which has not realized the financial fruits that either side expected. A source familiar with the business told me that the cruise retailer was “hemorrhaging money” even though two ships were now in operation—Scarlet Lady និង Valiant Lady. It seems that the retailer could not wait it out for the next two vessels to come on stream: Resilient Lady will be inaugurated in May in Athens, Greece, and Brilliant Lady will launch later this year.

The source said: “Virgin Voyages’ occupancy levels over the past 18 months have been very low, and certainly not enough for an onboard retailer to make any money. It has been several years that Harding+ has not seen a return, so it’s not surprising that the company has pulled out.” Neither Harding nor the cruise line revealed the terms of their deal.

Virgin Voyages—which is a private company whose investors include Virgin Group, Bain Capital Private Equity, and other investors (most recently BlackRock with a $500 million injection)—did not divulge its occupancy levels when asked. A spokesperson told me: “Demand continues to grow and we just celebrated another record booking week. Occupancy continues to rise and we expect to see a healthy and strong Q4.”

A limited target audience

Occupancy levels at other, more conventional, cruise lines are rising fast and several, such as Norwegian Cruise Line and Royal Caribbean, បានព្យាករណ៍ that they will be back to historic levels this summer or earlier, helped, no doubt, by deals and incentives. Virgin’s adult-only, pricey positioning and somewhat alternative offering—which make it unique and distinctive in a buoyant market—might now hinder it as the target audience is limited and could therefore act as a drag on the business.

Virgin Voyages will now partner with cruise retailer Starboard Cruise Services which is a highly experienced purveyor of luxury brands, as one might expect being part of the LVMH Moët Hennessy Louis Vuitton stable, which has just announced records sales. However, Starboard does not have the quirkiness or humor that Branson’s brands are known for so this will make for an interesting pairing. Starboard made no official statement on its new partnership.

Meanwhile, Harding+ will turn its attention to 13 other ships on which it is launching as the retail partner. The British-headquartered company currently operates some 300 shops on more than 100 cruise ships run by over 20 cruise line partners, and claims to be the number one operator in the sector in terms of scale.