2013.a6.032.14c final report prof hsu
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PUBLIC POLICY RESEARCH FUNDING SCHEME
公共政策研究資助計劃
Project Number : 項目編號:
2013.A6.032.14C
Project Title : 項目名稱:
Enhancing Hong Kong's Competitiveness as a Regional Cruise Hub from a Policy Perspective 從政府政策的角度探討如何提昇香港作為區域性郵輪樞
紐的競爭力 Principal Investigator : 首席研究員:
Professor HSU Hui Chun Cathy 徐惠群教授
Institution/Think Tank : 院校 /智庫:
The Hong Kong Polytechnic University 香港理工大學
Project Duration (Month): 推行期 (月) :
15
Funding (HK$) : 總金額 (HK$):
556,600.00
This research report is uploaded onto the Central Policy Unit’s (CPU’s) website for public reference. The views expressed in this report are those of the Research Team of this project and do not represent the views of the CPU and/or the Assessment Panel. The CPU and/or the Assessment Panel do not guarantee the accuracy of the data included in this report.
Please observe the "Intellectual Property Rights & Use of Project Data” as stipulated in
the Guidance Notes of the Public Policy Research Funding Scheme. A suitable acknowledgement of the funding from the CPU should be included in any
publication/publicity arising from the work done on a research project funded in whole or in part by the CPU.
The English version shall prevail whenever there is any discrepancy between the
English and Chinese versions. 此研究報告已上載至中央政策組(中策組)網站,供公眾查閱。報告內所表達的意見純屬本
項目研究團隊的意見,並不代表中策組及/或評審委員會的意見。中策組及/或評審委員會不保
證報告所載的資料準確無誤。 請遵守公共政策研究資助計劃申請須知內關於「知識產權及項目數據的使用」的規定。 接受中策組全數或部分資助的研究項目如因研究工作須出版任何刊物/作任何宣傳,均
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PUBLIC POLICY RESEARCH FUNDING SCHEME
Project number: 2013.A6.032.14C
Enhancing Hong Kong’s Competitiveness as a Regional Cruise Hub from a Policy Perspective
Final Report
Principal Investigator: Professor Cathy Hui-Chun Hsu
The Hong Kong Polytechnic University
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Abstract in English
The newly launched HK$8.2 billion Kai Tak Cruise Terminal represents the government’s
determination to establish Hong Kong as a regional cruise hub (Hong Kong Tourism
Commission, 2013). The 2014 Chief Executive Policy Address further emphasized the
government’s support to ensure timely completion of the second berth in 2014 and develop Hong
Kong into a leading cruise hub in the region. Hong Kong has been a must-see destination for
international tourists and the most popular outbound destination for Mainland Chinese. However,
Hong Kong faces fierce competition from neighboring ports (e.g., Shenzhen and Guangzhou).
Singapore and Shanghai have also declared their plan of being a regional cruise hub.
Neighboring economies (e.g., Vietnam, South Korea, and Taiwan) are also aggressively
expanding their cruise port infrastructure and trying to capture the rapidly growing Asian cruise
traveler market.
Formation of the Northeast Asia Cruise Circle (China-South Korea-Japan) and the Southeast
Asia Cruise Circle (with Singapore as the core port) may marginalize Hong Kong’s importance
as a cruise homeport. The traveling distance between Hong Kong and the next available port-of-
call (e.g., 17 hours to Xiamen, 23 hours to Sanya, and 28 hours to Keelung) could make Hong
Kong-based travel itineraries less attractive. In 2012, the number of cruise passengers in Hong
Kong decreased 11.6% from that of 2011 (Hong Kong Tourism Board, 2013). With the launching
of the new Kai Tak Cruise Terminal, the number showed an 8.7% year-on-year increase in 2013
(Hong Kong Tourism Board, 2014) and a 7.8% increase in 2014 (Hong Kong Tourism Board,
2015). However, it is necessary to have a comprehensive understanding of what it takes to
become a competitive regional cruise hub.
2
Such an understanding should include at least four dimensions: (1) travelers’ cruise preferences
and behaviors, (2) cruise lines’ decision-making criteria in selecting ports (e.g., supportive host
government policies), (3) tourism businesses’ readiness to accommodate cruise travelers (e.g.,
professional competency in selling/handling cruise tourism and capacity), and (4) the
competitive landscape particularly in the Pearl River Delta region and in Asia. Armed with a
thorough understanding of these key aspects, the government will be able to draw policy
implications to support its development. Without proper government policy support, the goal of
becoming a regional cruise hub may have difficulty to be realized, and the investment in the
Cruise Terminal may be scrutinized. This study used rigorous methodologies, including in-depth
interviews, focus groups, telephone survey, and benchmarking global best practices, to draw
conclusions and provide policy implications.
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Abstract in Chinese
2013 2014
2013 8.7% 2014
7.8%
1 2
3 4
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Cruise Industry Development
The cruise industry has experienced a stable growth with an average of 7.6% annual growth rate
of passenger numbers since 1980 (Cruise Lines International Association [CLIA], 2011). The
popularity of cruise vacation among the public can also be reflected in the full occupancy of
cruise lines and the continuous increase of supply (CLIA, 2013a). Data from the 26 member
cruise lines of CLIA indicated that 13 more ships were introduced in 2013, with over 14,000 new
beds (CLIA, 2014).
Despite the increased revenue of cruise tourism, only a very small percentage of people in the
world have cruised. Taking the U.S. for an example, only 3.55% of Americans traveled with
cruise in 2014 even with the country’s dominant role in the global cruising arena. Therefore,
there is ample room for further development of cruise tourism in the global market.
Although the development of cruise tourism is not a recent phenomenon, the focus of
development has been on North America followed by Europe. In 2012, as much as 68% of cruise
passengers were sourced from North America (CLIA, 2013b). The European cruise source
markets also maintained a double-digit annual growth rate between 2007 and 2011 (European
Cruise Council, 2013).
While remaining active in North America and Europe, the cruise industry has started to explore
new markets in Asia in recent years. The rising role of Asia in the global economy has drawn
much attention to the Asia Pacific region. Although Asia comprises of only a small portion of the
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current cruise tourism business (representing merely 3.4% of global itineraries and deployment),
its growth potential can be reflected in the 302% increase of ship deployment in the Asia Pacific
region between 2008 and 2013 (CLIA, 2013b). Cruise Industry News (2013) reported that,
compared with the previous year, the worldwide market share of Asia Pacific increased from 6%
to 9.1%, a more than 50% increase.
Take Mainland China as an example, China Cruise and Yacht Industry Association (CCYIA,
2013) reported 285 cruise ship arrivals in 2012, an 8.8% growth over the previous year. The
number of cruise passengers reached 660,000, a 31.9% increase over 2011. The number of cruise
ships using Mainland China homeports increased to seven. In 2013, the cruise ship arrivals were
expected to increase 34% in Shanghai and 289% in Tianjin (CCYIA, 2013).
Seeing the business opportunities in Asia and the huge potential demand from Asian tourists for
cruise travel, governments and industry partners including cruise companies, port authorities and
travel agencies are eager to form strategic alliances for exploring and attracting new Asian
customers on board. Consequently, several facilitating tactics have been initiated to nurture such
collaboration including building homeports to accommodate cruise ships, formulating more
encouraging policies to attract international cruise companies, and strengthening the social
networks among industry partners. The recent cruise conferences and forums in Tianjing (7th
China Cruise Shipping and International Cruise Expo in September 2012), Shanghai (The 3rd
Seatrade All Asia Cruise Convention in September 2012), and Hong Kong (Hong Kong Cruise
Forum in January 2013) demonstrate the interests of destinations and industry partners in
developing cruise tourism in Asia. Participants are eager to strengthen the regional collaboration
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to respond to the rising demand of cruising.
Competitive Landscape in Asia
The newly completed HK$8.2 billion Kai Tak Cruise Terminal represents the government’s
determination to establish Hong Kong as a regional cruise hub (Hong Kong Tourism
Commission, 2013). To become a cruise hub, the city needs to attract cruise lines to operate their
cruises using the city as a base, or a homeport. For example, Miami is the homeport of 30 ships
from 13 cruise brands (Port Miami, 2014). Homeports have the advantages of a constant flow of
visitors, stable revenue for cruise terminals, and significant impacts on local economies. For
instance, cruise industry generated 11,017 jobs, US$1.6 billion business revenue, and US$4.3
million of state and local taxes for Port Canaveral, another popular homeport in the United States
(Martin Associates, 2013).
Located at a strategic geographical position in Asia Pacific, Hong Kong has been a must-see
destination for cruise passengers and other international tourists visiting Asia. The rapid growth
of the cruise industry in Asia provides great opportunities as well as raises big challenges to
Hong Kong. On one hand, the development of port infrastructures in Asian cities and the growth
of the Chinese outbound travel market can enhance Hong Kong’s role as a regional cruise hub.
The latest incentive policy from the central government, which allows Mainland cruise
passengers to board a Hong Kong-based cruise ship, visit intermediate ports in Taiwan, sail to
Japan or Korea, and directly go back home, creates broad space for developing new itineraries
with Hong Kong as the homeport.
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On the other hand, Hong Kong is facing fierce competition from major neighboring ports. For
example, both Singapore and Shanghai have declared their plan of being a regional cruise hub.
Beside Shanghai, at least 15 other ports in Mainland China (i.e., Yingkou, Tianjin, Dalian,
Weihai, Yantai, Qingdao, Zhoushan, Ningbo, Xiamen, Shantou, Guangzhou, Zhuhai, Beihai,
Haikou, and Sanya) have hosted international cruise ships (CCYIA, 2011). The formation of the
Northeast Asia Cruise Circle (China-South Korea-Japan) and the Southeast Asia Cruise Circle
(Southeast Asian countries with Singapore as the core port) may marginalize Hong Kong and
make it a port-of-call, only used for seasonal repositioning of the ships. In 2012, the total number
of cruise passengers in Hong Kong decreased 11.6% from that of 2011 (Hong Kong Tourism
Board, 2013). With the launching of the new Kai Tak Cruise Terminal, the number showed an
8.7% year-on-year increase in 2013 (Hong Kong Tourism Board, 2014) and a 7.8% increase in
2014 (Hong Kong Tourism Board, 2015).
There has been several media reporting of the various unfortunate events happened on the
overnight gambling cruises over the past few years (Chong, 2010; Kao, 2013). In fact, 96.9% of
Hong Kong residents’ cruise experience from Hong Kong is on those cruises without destination
(Hong Kong Tourism Board, 2014). The proliferation of overnight casino cruises departing from
Hong Kong has caused confusion among local residents and visitors to the city about Hong
Kong’s cruise industry. Blog posts have discussed whether cruise ships operated by a particular
cruise line are all casino cruises. Many bloggers often showed difficulties in differentiating
between gambling focused cruises and other cruises (e.g., Angel, 2007; PN4X, 2007). Thus, the
impact of these events and reports as well as local cruise passengers’ past experience on the
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image of Hong Kong’s cruise industry need to be examined to identify any potential barriers in
developing cruise tourism.
The Asian cruise industry is now exploring more fresh and exotic destinations and itineraries to
attract more people on board. The industry is also expanding the customer base by promoting
cruise vacations to different segments of Asian travelers. With more and more Asian countries
and regions joining the cruise tourism business including Indonesia, Japan, South Korea,
Mainland China, Malaysia, Singapore, Taiwan, Thailand, and Vietnam, Hong Kong needs to
develop new product offerings, supporting services and other competitive advantages to expand
its customer base and consolidate its position as a preferred port for cruise travel.
For cruise lines to commit to a homeport, comprehensive analysis of the port and the city needs
to be done. Due to the competitive landscape now with many cities in the region trying to
establish themselves as the regional cruise hub, only the most competitive few will succeed in
this regard. Supportive host government policies have been highlighted as an important criterion
in considering future growth by cruise lines (Tercek, 2013). Thus, the Hong Kong government
needs to have a complete understanding of the cruise operators’ decision making criteria and
challenges, consumer market characteristics, and the competitive landscape particularly in the
Pearl River Delta region and in Asia to draw policy implications to support the development of
Hong Kong’s cruise industry. Without proper government policy support, the goal of becoming a
regional cruise hub may have difficulty to be realized, and the multi-billion dollar investment in
the Kai Tai Cruise Terminal may be scrutinized.
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How tourism destinations develop, preserve, defend, and reinforce their competitive positions in
an ever more competitive environment is a challenge that has risen to prominence in the tourism
industry (World Economic Forum, 2013). The challenge is exemplified by several important
complexities. First, a tourism destination is very different from other commercial products
because the tourist experience provided by the destination is delivered by many different sectors
of the economy, including tourism businesses (e.g., hotels, restaurants, airlines, tour operators)
and other supporting organizations (e.g., entertainment, sports, recreation, public transport,
government agencies). Second, tourists come from different backgrounds and bring different
preferences and behaviors. Tourism products cannot and ought not to be standardized so that
each tourist returns home with a unique memorable experience. Third, different parties involved
under the tourism development umbrella have different goals; some are for private gains while
others are for the public good. Some relate to economic returns, while others concern about
environmental and social outcomes. Thus, managing the sustainability of destination
competitiveness has become a major topic of interest for private enterprises as well as
governments. The current body of research has concluded that destination competitiveness
cannot be attributed to a small set of determinants (Crouch, 2011).
The task of becoming a cruise hub is even more challenging than becoming a successful
destination due to the multiple “customers” involved. Not only does the cruise hub need to attract
travelers to the city, which is a primary aim of destination management organizations, a cruise
hub also needs to attract cruise lines to use its facilities and services.
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Learning from Best Practices
Well established, successful homeports from the world’s top cruise markets (i.e., the US and
Mediterranean) (Cruise Lines International Association, 2013a) were investigated thoroughly to
examine the required tourism infrastructure to support a similar size homeport facility. For
example, issues to consider include tour operator capacity, types and number of specialized tour
guides, and tourist attraction capacity needed to host thousands of visitors during a short period
of time (usually less than 8 hours). The number of employees needed for the terminal operations
and the number of cruise specialists in travel agencies needed to serve the main traveler origin
markets would have implications for human capital development needs, which may need to be
addressed by labor or education/training policies. Best practices from US and the Mediterranean
could also help identify workable regional cooperation and cross industry sector collaboration
models. Finally, Hong Kong can learn from those mature homeports’ critical success factors.
Regional Competitor Analysis
Neighboring cities, such as Shenzhen, Guangzhou, and Zhuhai, in the Pearl River Delta region
have also invested in their cruise terminal facilities and plan to expand their cruise tourism
industry. To develop a regional collaboration strategy to best utilize the “co-opetition”
relationship among Pearl River Delta region cruise ports, it is important to examine the role of
governments and cruise port policies (e.g., incentive to cruise lines, pricing of ports, any form of
subsidy) in nearby competitive ports. Such an understanding will facilitate the development of
competitive strategies and examine regional collaboration opportunities and challenges, which
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may have policy implications. Operating under the “one country, two system” status, Hong
Kong’s challenges to form regional collaboration may include its different political and legal
framework from nearby ports, which create complexity in handling cruise lines and cruise
travelers. However, Hong Kong’s integrated logistics, including seaport and airport, provides the
city institutional advantages for international tourist flow. The study conducted a comprehensive
evaluation of the competitive landscape of cruise industry development in the Pearl River Delta
region.
Study Objectives
Based on the preceding background information, the following study objectives were developed:
1. To systematically analyze the supply and demand of cruise related infrastructure, cruise
product offerings, and associated tourist attractions and services regionally;
2. To develop effective strategies for Hong Kong’s development as a regional cruise hub
based on best practices of successful mature cruise hubs globally;
3. To draw necessary implications for the formulation of future tourism and tourist flow
related policies on the development of Hong Kong as a regional cruise hub in such a way
that the positioning of Hong Kong can complement that of other cruise ports in the Pearl
River Delta Region.
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Research Methodology
The study went through a four-stage process. Details of the research activities are summarized in
Table 1 and further elaborated in the following sections.
Table 1. Research process
Stage Activities
1. Literature review and background information
Desk research on Cruise tourism and product offerings Cruise travel behaviorsAsia regional cruise port infrastructure developmentTourism development plans in the regionAcademic publications and public press
2. Best practices analysis
Site visitsUS: New York, Florida (Miami, Everglades)EU: Rome, Venice, Barcelona
Desk researchProduct offeringsPort infrastructure
Interviews (13 in US and 7 in EU)Port authorityTravel agencyTourism bureauCruise service company
3. Regional competitor analysis
Desk researchProduct offeringsPort infrastructure
Interviews (11 in Hong Kong, Shenzhen, Guangzhou, Zhuhai)Port authorityTravel agencyTourism bureau
4. Evaluation of local and regional source markets
Focus group4 focus groups with residents in Hong Kong and Shenzhen
Survey Items review6 experts on cruise travel18 cruise travelers in Ocean Terminal before embarkation
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SurveyPilot study in Kai Tak Cruise Terminal with 276 cruise travelers before embarkation Online data collection with 406 Hong Kong residents, 413 Guangzhou residents, and 415 Shenzhen residentsTelephone data collection with 250 residents each in Hong Kong, Guangzhou, and Shenzhen
Phase I. Literature review and background information collection
The major task in this phase was to further review the existing literature on the supply and
demand of cruise tourism and product offerings, cruise traveler behaviors and demand patterns,
Asian regional cruise port infrastructure development, and tourism development plans of various
governments in the region. A comprehensive review of literature provided a solid foundation of
and direction for competitive strategy and government policy formulation. Research background
information was collected from both academic and professional publications, and relevant
associations’ and organizations’ websites.
Phase II. Best practices analysis
Research field visits were conducted to successful homeports in the US (i.e., Miami, Port
Everglades, and New York) and the Mediterranean (e.g., Rome, Venice and Barcelona) to
investigate their industry structure, capacities, and logistics regarding tourist flows, as the US
and the Mediterranean are top cruise itinerary deployment regions (CLIA, 2013a). Interviews
were conducted with port authorities, managers of major international cruise lines that used
visited ports as their homeports, local tour operators, tourism organization officials, and relevant
departments of the government (e.g., tourism bureau and chamber of commerce). Sample
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interview guides are provided in Appendix A. Data collected during the site visits and interviews
were transcribed into text and content analyzed to identify government policies related to cruise
industry development, critical success factors of homeports, required tourism infrastructure,
human capital needs, and possibly travel trade regulations.
Phase III. Regional competitor analysis
Desk top research was conducted and tourism bureau officials of Hong Kong, Guangzhou,
Shenzhen, and Zhuhai were interviewed to identify the role of governments and their respective
cruise port policies (e.g., incentive to cruise lines, pricing of ports, any form of subsidy).
Managers of cruise lines that have decided to use Hong Kong and other nearby ports as their
homeport were also interviewed to find out the reasons and determining factors of the decisions.
Such an understanding facilitated the development of competitive strategies and examined
regional collaboration opportunities and challenges. Each port was assessed based on its
strengths and weaknesses as a homeport.
Local travel agencies selling cruise products and tour operators providing shore excursion
services were also interviewed to understand local trade practices, challenges faced, and any
knowledge/skill gap. Hosting capacities were further analyzed based on data collected from
various sources in Phases I, II, and III of the project.
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Phase IV. Evaluation of local and regional source markets for Hong Kong’s cruise industry
Focus groups and surveys were used to collect information from Hong Kong residents and the
main source market, Guangdong residents (Hong Kong Tourism Board, 2013), on the image of
Hong Kong’s cruise industry and their cruise preferences and future plans. In 2012, overnight
visitors to Hong Kong from Guangdong Province accounted for 50.9% of the total overnight
visitors from Mainland China. Among them, a significant portion was from Guangzhou (17.6%)
and Shenzhen (12.2%), which together accounted for almost 30% of the total overnight visitors
from Mainland China (Hong Kong Tourism Board, 2012). Therefore, the focus group and survey
samples were drawn from Hong Kong, Guangzhou, and Shenzhen residents.
The study conducted two focus groups in Hong Kong and two in Shenzhen as an initial step to
understand potential cruisers’ perceptions, motivations, and preferences. Focus group discussions
were audio recorded and transcribed. Text data were content analyzed using Altlas-ti software.
The survey questionnaire was design based on the literature (e.g., Fan & Hsu, 2014) and focus
group results. A total of 92 motivation items were identified from these two sources. An expert
panel of six academics with cruise research experience and an understanding of Chinese travelers
was invited to comment on the relevance of each of the 92 items, using a 3-point scale (1 = low
relevance, 2 = medium relevance, 3 = high relevance). In addition, 18 travelers who were ready
to embark on a cruise journey in the Ocean Terminal were invited to comment on the relevance
of each of the 92 items as well using the same scale. The consumer average, expert average, and
overall average of each item was examined. For items with an overall average of 2.0 or lower,
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the average of the experts and average of consumers were reviewed. When both averages were
2.0 or lower as well, the item was removed. When either expert or consumer average was higher
than 2.0, the item was retained. This process removed 26 items, resulting in 66 items.
To further reduce the number of motivation items, a pilot study was conducted in Kai Tak Cruise
Terminal among passengers who were waiting for their embarkation. The survey was completed
by 276 respondents. Exploratory Factor Analysis was used to identify potential dimensions of
cruise travel motivation and reduce the number of measurement items. After the measurement
refinement, 24 items were retained.
The 24 motivation items were included in the final questionnaire, along with perceptions and
intention of taking a cruise holiday, past travel and cruising experience, and demographic
questions. Two waves of data collection took place. The first wave was conducted online (with a
target of 400 completion per city) to generate some initial results, followed by a telephone survey
with a smaller sample size (with a target of 250 completion per city). The two different data
collection methods reduced common method bias, reached more diverse populations, and
speeded up the data collection process. The online survey, with a larger sample size, also reduced
the total costs of data collection due to the higher unit cost of telephone survey.
The online questionnaire was completed by 406 Hong Kong residents, 413 Guangzhou residents,
and 415 Shenzhen residents. Strict quality assurance measures were in place for the online
survey to enhance the reliability and validity of the data collected. For example, the order of the
question items within a category (e.g., motivation) was set as random, thus each respondent
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answered the questions in a random order to avoid sequence bias. Respondents who provided
80% or more of the same response (e.g., selecting 4 on a 5-point scale) in any category of
questions were disqualified; that is, the survey session ended once the 80% threshold was
reached. A speed check was also included in the online survey. Respondents who completed the
whole questionnaire within three minutes were disqualified due to the potential of not reading the
questions carefully as the survey should normally take approximately 10 minutes to complete.
Other measures include breaking long sections into multiple parts with an irrelevant question
(e.g., how many days are in the month of November) located between the sub-sections to ensure
that respondents were paying attention.
Based on the actual geographical distribution of population in these three cities, a quota sampling
method was used for the surveys. Based on the report from the Census and Statistics Department
of the Government of the Hong Kong Special Administrative Region (2013), the population
figures in the Hong Kong Island, Kowloon, and the New Territories in 2012 were used to
calculate the sample size of the various regions. The population and sample size are presented in
Table 2.
Table 2. Sampling in Hong Kong
District Population Percentage of Total (%)
No. of Online Survey
No. of Telephone Interviews
Hong Kong Island 1,277,200 17.9 72 45Kowloon 2,146,800 30.0 120 75New Territories 3,729,600 52.1 208 130
Total 7,153,600 100.0 400 250
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The same quota sampling method was applied to Guangzhou and Shenzhen. Data obtained from
the Guangzhou Statistics Bureau (2011) and the Shenzhen Statistics Bureau (2012) were used to
derive the study sample. Tables 3 and 4 present the calculation.
Table 3. Sampling in Guangzhou
District Population Percentage of Total (%)
No. of Online Survey
No. of Telephone Interviews
Town center 7,727,163 60.9 244 152New town 3,343,491 26.3 105 66County level districts
1,630,146 12.8 51 32
Total 12,700,800 100.0 400 250
Table 4. Sampling in Shenzhen
District Population Percentage of Total (%)
No. of Online Survey
No. of Telephone Interviews
Futian 1,325,200 12.7 51 32Luohu 931,000 8.9 36 22Yantian 211,000 2.0 8 5Nanshan 1,099,900 10.5 42 26Bao’an 4,548,400 43.4 173 109Longgang 2,351,900 22.5 90 56
Total 10,467,400 100.0 400 250
For the telephone survey, 250 completed responses were obtained as planned. Survey data were
analyzed using SPSS software. Descriptive statistics (e.g., frequency, means, and standard
deviation) were calculated to provide sample profile and basic information on respondents’
perception of Hong Kong’s cruise industry and its image, cruise travel preferences, and future
cruise travel plans. Additional comparisons, using Analysis of Variance (ANOVA), were made to
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identify differences among sample groups.
Results
Findings from Desk Research and Interviews
The forecast by McKinsey & Company shows that cruise travelers in Asia will represent 20% of
the global market, with approximately 7 million cruisers in 2020. The demand for cruise holidays
is expected to increase, with Mainland China as the primary source market in Asia. Secondary
source markets include Hong Kong, Singapore, Vietnam, Taiwan, and Japan, among others.
In terms of supply, cruise lines will continue to add capacity to Asia with more ships, larger
ships, and new ships. The following ships have been confirmed to be introduced to the China
market over the 2015-2018 period:
• Royal Caribbean' Quantum of the Seas (4,000+ guests) to Shanghai in 2015
• Star Cruises' new ship, Genting Dream, (3,400+ guests) in South China and Hong Kong
(triple homeports) by Nov 2016
• Costa Fortuna, built in 2003
• MSC Lirica, built in 2003, 1,500 guests
• Carnival Miracle, built in 2003, 2,000 guests
• Ovation of the Seas(RCI), newly built, 4,000+ guests
• Majestic Princess, newly built, 3,600 guests
• AIDA new ship, AIDAbella, likely 2,700 guests
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• Norwegian new 2017 ship, name TBD, 4,000+ guests
• Star Cruises new 2017 ship, World Dream
• Carnival Splendor new 2018 ship
Asia holds particularly strong potential in developing the cruise industry with the following
strengths:
• Market expansion and penetration (esp. in Mainland China)
• Tremendous development in infrastructure (e.g., Mainland China)
• Cruise lines adding capacity into Asia (more, bigger, newer ships)
• Plenty of beautiful and potential cruise destinations
However, Asia also has it challenges in developing the cruise industry:
• Dated and insufficient infrastructure (e.g., Vietnam)
• Awareness and understanding of cruise tourism (customers, governments, travel agents)
• Operational challenges (visa and paperwork)
• Political conflicts (e.g., China–Japan and China–Vietnam)
• Pollution (affects the sustainability of the industry)
The major source markets of Hong Kong's cruises are Hong Kong and Southern China.
Secondary markets include the rest of Mainland China; Japan, Korea, Taiwan, and Southeast
Asian countries; and medium- (e.g., India) and long-term fly cruise markets.
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The cruise throughput statistics of Hong Kong from 2010 to 2014 shows a gradual increase
(Figure 1), with similar number of local and non-local passengers. Total throughput is the sum of
passenger arrivals and departures. The overwhelming majority of Hong Kong residents' cruise
activities are onboard the "Other" type of cruises, primarily the overnight cruises to the open sea
with no destination. The "homeporting" passenger number did show an increase from 2013 to
2014 after the opening of the Kai Tak Cruise Terminal.
Figure 1. Cruise throughout statistics
Source: Hong Kong Tourism Board (2015).
The competition among regional ports is becoming fierce. Shanghai primarily serves as a
homeport for Northeast Asia itineraries to South Korea and Japan, while Singapore serves as a
homeport for Southeast Asia itineraries to Thailand, Cambodia, and Vietnam. Hong Kong,
located between these two major homeports, serve two main roles: (1) as homeport for round
- 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000
1,000,000
2010 2011 2012 2013 2014
Non-local Passengers
Transit Homeporting
Other Total
-
200,000
400,000
600,000
800,000
1,000,000
2010 2011 2012 2013 2014
Hong Kong Residents (estimated)
Homeporting Other
Total
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trips to Taiwan, Japan, and Xiamen (northbound) and Sanya and Vietnam (southbound) and (2)
as port-of-call and turnaround port for itineraries between Southeast Asia and Northeast Asia.
Based on site visits, interviews, and desk research, the success factors of homeports include
location, transportation/accessibility, destination image, port condition, commercial and
entertainment facilities, customer service, innovation, collaboration with different entities, and
promotion. Details of the factors are outlined in Table 5, with best practice examples provided.
Table 5. Success factors of homeports
Factors Characteristics Examples
Location 1. Distance to other popular cruise destinations
2. Availability of a large population base
1. Miami
2. Miami
Transportation/accessibility 1. Access to the city, including road and airport infrastructure
1. Miami, Barcelona
Destination image 1. The city is a famous tourist destination in itself
2. Attractions and hotels
1. New York, Miami, Venice, Barcelona
2. Miami, Barcelona
Port condition 1. Multiple berths2. Efficient facilities (e.g., two
loading bridges per terminal)
1. Manhattan Terminal2. Everglades
Commercial and entertainment facilities
1. Shopping 1. Everglades
Customer service 1. Quality service of all segments
2. Efficient visa processing3. Multilingual tour guides
1. Barcelona
2. Venice3. New York
Innovation 1. iPad check-in 1. Barcelona, FranceCollaboration with different entities
1. Cruise lines, government, tour operator
1. New York, Miami, Barcelona
Promotion 1. Events and festivals 1. Venice
23
Regional competitiveness of Hong Kong was investigated and compared with the ports of
Guangzhou and Shenzhen. The advantages and disadvantages of Guangzhou and Shenzhen ports
are summarized in Table 6.
Table 6. Regional competitiveness
Guangzhou Shenzhen
Future outlook
1. Uncertain status of Guangzhou as a homeport
2. Cruise will remain an area of focus for travel agencies
1. Taizi Bay will be positioned as a homeport, although it takes time
Pros
1. Large population base, and outbound travel is popular among Guangzhou residents
2. Transportation hub in the province3. Plenty of tourism resources4. Nansha is expected to receive
policy support, and it has sufficient land area
1. Economic development & quality of life
2. Comprehensive transportation system
3. Cruise lines are willing to come, convenient for Mainland passengers
4. China Merchants Group :a state-owned enterprise has good relationships with government
Cons
1. Nansha cruise terminal is away from city center
2. Lack of experience in handling international cruise lines
1. A late comer in the business2. Frequent traffic jam in Shekou area3. Relatively weak in shopping,
dining, and MICE
Relationships with Hong Kong
1. Cooperation in terms of cruise itineraries
2. Competition in terms of the source market
1. Hong Kong will draw more international passengers, while Shenzhen will rely more on domestic market
2. In the long run, direct competition as a homeport
24
Compared to Guangzhou and Shenzhen, the competitiveness of Hong Kong is outline as follows:
Advantages:
• World class facilities
• International name recognition
• Big emerging market of Hong Kong and Mainland China
• Positive image from source markets
• Infrastructure (e.g., air connectivity, service quality, hotels)
• Support from the government
• Travel agencies’ training and marketing
Disadvantages:
• Residents’ understanding of cruise holidays
• Extra time and money for people coming from Guangzhou and Shenzhen
• Main source market’s entry permit issue
• Location: limited port of call choices; long sailing time to attractive destinations
• Regional competition
• Inadequate transport arrangements near Kai Tak
Findings from Surveys
After cleaning and screening, data collected through online and telephone surveys were
compared to identify potential differences caused by the different data collection methods.
However, no significant differences were found, thus the data were combined for further analysis.
25
Table 7 reports the profile of respondents, which shows that the surveyed residents represented a
mix of gender, age, and income groups. Respondents were generally well educated.
Table 7. Demographic Characteristics of Respondents
Characteristic Percentage
Hong Kong Shenzhen Guangzhou
Gender Male 37.7 41.2 44.8Female 62.3 58.8 55.2
Age<18 - - -18-25 22.4 14.5 16.526-35 39.4 46.5 45.836-45 22.9 28.9 28.346-55 12.6 9.9 7.056-65 2.7 .2 2.2>65 - - .2
EducationSecondary/high school or below 24.9 3.9 3.9College diploma or university degree 68.2 85.5 87.4Postgraduate degree or above 6.9 10.6 8.7
Monthly household income< HK$10,000, or < CN¥4,000 9.9 .7 1.0HK$10,000-14,999, or CN¥4,000-7,999 13.8 2.4 3.6HK$15,000-19,999, or CN¥8,000-11,999 21.4 7.0 14.8HK$20,000-24,999, or CN¥12,000-15,999 18.0 13.0 16.2HK$25,000-29,999, or CN¥16,000-19,999 15.5 10.4 14.3HK$30,000-39,999, or CN¥20,000-29,999 11.6 26.0 24.2HK$40,000-49,999, or CN¥30,000-39,999 9.9 20.2 13.3HK$50,000-59,999, or CN¥40,000-49,999 - 9.9 6.3HK$60,000-69,999, or CN¥50,000-59,999 - 7.0 3.1>HK$69,999, or>CN¥59,999 - 3.4 3.1
Marital statusSingle 58.9 20.2 23.0Married without child(ren) 13.3 12.8 14.0Married with child(ren) 27.8 67.0 63.0
Household size1 2.2 1.9 2.22 18.7 10.1 15.73 28.3 65.5 55.0
26
4 34.7 14.9 16.05 9.9 6.0 8.7>5 6.2 1.4 2.4
Respondents' self-perceived travel experiences are quite high, especially for domestic travel
among Guangzhou and Shenzhen residents (Table 8). For outbound travel, Hong Kong residents
reported the most experience, followed by Shenzhen and Guangzhou respondents. As for cruise
travel, Hong Kong respondents reported the lowest mean. Generally speaking, Shenzhen
residents are more well traveled compared to Guangzhou residents.
Table 8. Travel experience
Type of Tour Hong Kong Shenzhen Guangzhou
Meana SD Meana SD Meana SD
Domestic tour (by all means) - - 4.38 .694 4.26 .728Outbound tour (by all means) 3.98 .876 3.76 .960 3.59 1.014Cruise tour 2.50 1.217 3.38 1.159 3.03 1.217a Scale: 5 = rich experience and 1 = no experience.
In terms of respondents' perceptions of cruising, significant differences were found among Hong
Kong, Shenzhen, and Guangzhou residents (Table 9). Shenzhen and Guangzhou residents
appeared to have more positive perceptions of cruise holidays than Hong Kong residents did.
Shenzhen and Guangzhou residents reported higher means of most perception items. However,
Hong Kong residents held the perception that cruises take much longer than other forms of travel,
cruise holidays' costs are high, and they may feel bored and uncomfortable at seas. They also
held the believe that existing cruise itineraries are not attractive, cruising keeps them confined,
cruises are for senior citizens, and food served on cruise ships are not very tasty.
27
In terms of the top perceptions of cruise travel, Hong Kong respondents indicated that cruising
normally takes much longer than other modes of travel and that cruise holidays cost a lot of
money. On the positive side, Hong Kong respondents believed that cruise holidays take care of
the needs of all generations in the family and take the hassle (e.g., with luggage transfer) away.
Mainland respondents, on the other hand, thought that cruising is romantic, taking cruises allows
them to take plenty of photos and instantaneously share them on social networking sites, and
cruising is rising in popularity, thus they want to keep up with the trend.
Table 9. Perception of cruising in general
Perception Hong Kong Shenzhen Guangzhou F value
Meana SD Meana SD Meana SD
I get to visit multiple destinations and have both onboard and onshore experiences.
3.92 b .633 4.19 b .686 4.06 b .797 15.3***
Cruise ships are huge and equipped with an array of great facilities.
3.90 b .652 4.33 b .672 4.16 b .765 38.5***
Cruising normally takes much longer than other modes of travel.
3.82 .802 3.74 .908 3.75 .890 1.0
Cruise holidays offer a brand new experience and allow me to experience a destination from a different angle.
3.81 b .663 4.29 b .695 4.14 b .728 50.8***
Cruising relaxes my mind and body.
3.77 b .695 4.31 b .678 4.16 b .762 62.0***
Cruise holidays cost a lot of money.
3.71 bc .861 3.22 b .929 3.35 c .983 30.2***
There are special/themed programs onboard which I do not get to experience by other travel modes.
3.64 b .712 4.27 b .742 4.13 b .803 78.8***
Staff members onboard are kind and pleasant, making me feel warm and welcome.
3.64 b .652 4.17 b .703 4.05 b .826 60.3***
28
Cruise holidays take care of the needs of all generations in my family.
3.62 b .698 4.09 b .673 3.90 b .809 42.8***
Cruise ships are large social networking platforms where I can socialize with other passengers.
3.62 bc .726 4.21 b .681 4.17 c .702 89.4***
Cruise holidays take the hassle (e.g., with luggage, transfer) away.
3.62 b .727 4.06 b .700 3.87 b .841 35.0***
Cruising is romantic. 3.54 b .784 4.36 b .707 4.13 b .884 114.4***By taking a cruise, I can go to
places that are difficult to get to by other travel modes.
3.51 bc .891 4.08 b .741 3.96 c .813 55.2***
Compared to package tours, cruise holidays let me decide when to do what.
3.43 b .818 4.12 b .714 3.89 b .774 85.9***
Cruise ships provide reliable medical care onboard.
3.41 b .692 4.03 b .717 3.89 b .767 81.8***
Taking cruises allows me to take plenty of photos and instantaneously share them on social networking sites.
3.39 b .826 4.21 b .731 4.07 b .813 126.2***
Cruising is rising in popularity and I want to keep up with the trend.
3.33 b .846 4.18 b .727 3.95 b .823 123.4***
I might get bored while at sea. 3.29 b .918 2.57 b 1.114 2.84 b 1.100 48.7***Cruise seems to be a safe way to
travel compared to some other options (e.g., by air).
3.18 b .762 3.99 b .731 3.69 b .846 112.7***
I might feel uncomfortable mentally or physically being away from land.
3.10 b .960 2.63 b 1.107 2.91 b 1.113 20.7***
Existing cruise itineraries are not attractive.
3.03 b .881 2.52 b 1.167 2.75 b 1.078 23.9***
I do not have to worry about the safety of my belongings during a cruise holiday.
2.94 b .955 3.80 b .943 3.53 b .969 87.4***
Cruising keeps me in a confined environment and could be depressing.
2.91 b .932 2.39 b 1.122 2.64 b 1.137 24.6***
The cruise products are targeted at senior citizens.
2.88 b .973 2.63 b 1.060 2.77 1.017 6.4**
Food served on cruises does not taste good.
2.82 b .824 2.47 bc 1.105 2.68 c 1.000 13.8***
a Scale: 5 = strongly agree and 1 = strongly disagree.
29
b c Means in the same row followed by the same superscript are significantly different at p < .05.*p < .05, **p < .01, ***p < .001
When respondents were asked what comes to their mind when thinking about cruises in Hong
Kong, Hong Kong residents thought of short-haul and long-haul cruises (Table 10). However,
residents in Guangzhou and Shenzhen reported the highest means of ferries sailing on the
Victoria Harbor. Gambling cruises to nowhere had the lowest means among all three groups.
Table 10. Perception of cruise products in Hong Kong
Perception Hong Kong Shenzhen Guangzhou F value
Meana SD Meana SD Meana SD
I think of short-haul cruises to nearby Asian destinations.
3.69 b .806 4.01 .705 3.90 b .834 3.1*
I think of luxury long-haul cruises to Europe or America.
3.54 .974 4.06 .785 3.85 .965 1.9
I think of ferries sailing on Victoria Harbor.
2.98 b 1.150 4.11 b .771 3.92 .950 4.8**
I think of gambling cruises to nowhere.
2.85 1.093 3.11 1.069 3.15 1.061 .1
a Scale: 5 = strongly agree and 1 = strongly disagree.b c Means in the same row followed by the same superscript are significantly different at p < .05.*p < .05, **p < .01, ***p < .001
Regarding the perception of cruises sailing from Hong Kong compared to those from Shenzhen
and Guangzhou, Shenzhen residents consistently rated Hong Kong cruises the highest, while
Hong Kong residents reported the least favorable perceptions (Table 11, Figure 2). The only
exception is about the time-consuming nature of the journey to cruise terminal in Hong Kong, of
which Guangzhou residents rated the highest in agreement.
30
Table 11. Perception of cruises sailing from Hong Kong compared to those from Shenzhen and Guangzhou
Perception Hong Kong Shenzhen Guangzhou F value
Meana SD Meana SD Meana SD
Overall speaking, I can have a good travel experience.
3.72 b .632 4.25 b .644 4.12 b .775 65.3***
Passengers onboard the ships represent diverse nationalities.
3.69 b .796 4.20 b .707 4.03 b .828 44.9***
Supporting facilities and services are sufficient and efficient.
3.69 b .698 4.21 b .629 4.02 b .796 57.5***
The terminal premises are kept clean and hygienic.
3.67 b .791 4.07 b .777 3.91 b .812 25.4***
The cruise ships convey a feeling of elegance and luxury.
3.65 b .761 4.26 b .696 4.07 b .832 68.7***
Services provided are satisfactory. 3.63 b .630 4.22 b .686 4.03 b .758 76.7***I can be assured of a high level of
security. 3.60 b .822 4.05 b .716 3.85 b .836 32.8***
Quality of food is satisfactory. 3.54 b .732 4.07 b .722 3.88 b .838 51.4***The cruises are mostly punctual. 3.52 b .765 4.14 b .714 3.96 b .748 75.4***I can find a wide variety of
itineraries from these cruise products.
3.47 b .755 4.15 b .716 3.98 b .818 88.1***
The cruise products are good value for money.
3.37 b .790 3.98 b .791 3.77 b .839 61.0***
It is an arduous and time-consuming journey to get to the cruise terminal.
2.91 b 1.006 2.88 c 1.119 3.15 bc 1.035 7.8***
a Scale: 5 = strongly agree and 1 = strongly disagree.b c Means in the same row followed by the same superscript are significantly different at p < .05.*p < .05, **p < .01, ***p < .001
31
Figure 2. Perceptions of cruises sailing from Hong Kong compared to those from Shenzhen and Guangzhou
Respondents were asked to indicate their motivation for taking a cruise. Again, significant
differences were found among the three groups on all motivation items (Table 12). Shenzhen
residents consistently reported the highest motivation, followed by Guangzhou respondents.
Hong Kong residents reported the lowest scores for all motivation items. In terms of the top
ranked motivation items, Hong Kong respondents were motivated by reducing stress and getting
away from usual demands of life. Mainland residents were mostly motivated by being close to
and harmonious with nature.
32
Table 12. Motivation for taking a cruise
Motivation Hong Kong Shenzhen Guangzhou F value
Meana SD Meana SD Meana SD
I cruise to rest and relax. 4.06 b .634 4.43 b .625 4.31 b .779 31.9***I cruise to experience something
different.4.02 b .612 4.44 b .614 4.31 b .703 44.7***
I cruise to give my mind a rest. 3.90 b .659 4.36 b .643 4.18 b .732 46.7***I cruise to reduce stress. 3.90 b .656 4.21 b .659 4.04 b .803 20.1***I cruise to get away from everyday
physical stress/pressure.3.85 b .711 4.25 b .661 4.04 b .778 31.6***
I cruise to get away from everyday psychological stress/pressure.
3.83 b .664 4.19 b .689 4.05 b .830 26.3***
I cruise to have diverse experiences (onboard/onshore, multiple destinations).
3.81 b .678 4.29 b .654 4.16 b .773 50.8***
I cruise to get away from the usual demands of life.
3.78 b .705 4.14 b .728 3.94 b .787 23.9***
I cruise to have fun through cruise activities and facilities (e.g. bar, swimming pool, gym, basketball, jogging, yoga, karaoke).
3.77 b .748 4.25 b .739 4.10 b .791 43.7***
I cruise to get a better appreciation of nature.
3.71 b .762 4.38 b .644 4.21 b .784 91.9***
I cruise to be free to do whatever I want.
3.68 b .713 4.16 b .754 4.03 b .813 43.0***
I cruise to strengthen relationships with my family/friend(s).
3.66 b .709 4.15 b .699 3.97 b .825 46.3***
I cruise to strengthen relationships with my companion(s).
3.65 bc .714 4.06 b .716 3.95 c .794 33.7***
I cruise to be harmonious with nature.
3.65 b .751 4.35 b .656 4.11 b .852 90.3***
I cruise as I do not need to worry about time.
3.65 bc .818 3.96 b .774 3.85 c .859 15.4***
I cruise to be close to nature. 3.59 b .783 4.36 b .658 4.16 b .817 114.7***I cruise to explore the unknown. 3.50 bc .756 4.04 b .740 3.92 c .835 55.0***I cruise to observe other people in
the area.3.42 bc .796 3.79 b .858 3.71 c .857 22.8***
I cruise to meet people with similar values/interests.
3.37 b .731 4.17 b .731 3.97 b .868 115.8***
I cruise as I need not constantly worry about the safety of my belongings.
3.31 b .820 3.94 b .808 3.67 b .894 58.3***
33
I cruise to have daring/adventuresome experience.
3.27 bc .823 3.88 b .891 3.74 c .934 52.8***
I cruise to meet the locals. 3.17 bc .872 3.72 b .829 3.66 c .877 50.5***I cruise to follow the current trend
of cruising.3.13 b .895 4.07 b .771 3.85 b .878 138.4***
I cruise to follow current events. 2.93 b .848 3.88 b .815 3.65 b .822 146.3***a Scale: 5 = strongly agree and 1 = strongly disagree.b c Means in the same row followed by the same superscript are significantly different at p < .05.*p < .05, **p < .01, ***p < .001
When asked about their intention to take a cruise in the next three years, significant differences
were found among all three groups (Table 13, Figure 3). Shenzhen respondents reported the
highest intention, followed by Guangzhou and Hong Kong respondents.
Table 13. Intention to take a cruise
Intention Hong Kong Shenzhen Guangzhou F value
Meana SD Meana SD Meana SD
I intend to take a cruise from Hong Kong in the next three years.
3.55 b .898
4.42 b .639 4.08 b .889 116.8***
I intend to take a cruise in the next three years.
3.50 b .910
4.39 b .588 4.18 b .796 146.3***
a Scale: 5 = strongly agree and 1 = strongly disagree.b c Means in the same row followed by the same superscript are significantly different at p < .05.*p < .05, **p < .01, ***p < .001
34
Figure 3. Intention to take a cruise
A factor analysis was conducted using the Principal Axis factoring method and Oblimin with
Kaiser Normalization rotation. The analysis resulted in a seven-factor solution explaining
63.82% of the variance, as shown in Table 14. The seven motivation factors were named Nature,
Personal interaction, Escape/relax, Novelty, Hassle free, Fashion, and Relationship, with
Escape/relax, Relationship, and Nature having the highest means.
Table 14. Factor analysis of motivation items
MotivationFactor
LoadingEigen-value
% of variance
Nature ( = .866, Mean = 5.85a) 8.955 35.809I cruise to be harmonious with nature. .839I cruise to be close to nature. .756I cruise to get a better appreciation of nature. .646I cruise to be free to do whatever I want. .570I cruise to experience something different. .532
35
Personal interaction ( = .856, M = 4.69) 2.394 8.684I cruise to meet the locals. .950I cruise to observe other people in the area. .784I cruise to meet people with similar values/interests. .594
Escape/relax ( = .871, Mean = 6.00) 1.576 5.198 I cruise to get away from everyday psychological
stress/pressure..782
I cruise to get away from the usual demands of life. .702 I cruise to get away from everyday physical
stress/pressure..669
I cruise to reduce stress. .662 I cruise to give my mind a rest. .634 I cruise to rest and relax. .444
Novelty ( = .778, Mean = 5.55) 1.388 4.279 I cruise to have daring/adventuresome experience. .714 I cruise to explore the unknown. .628 I cruise to have diverse experiences
(onboard/onshore, multiple destinations)..592
I cruise to have fun through cruise activities and facilities (e.g. bar, swimming pool, gym, basketball, jogging, yoga, karaoke).
.453
Hassle free ( = .759, Mean = 5.32) 1.233 3.618 I cruise as I need not constantly worry about the
safety of my belongings.-.660
I cruise as I do not need to worry about time. -.513
Fashion ( = .885, Mean = 3.88) 1.118 3.333 I cruise to follow current events. .932 I cruise to follow the current trend of cruising. .852
Relationship ( = .792, Mean = 5.97) 1.057 2.898 I cruise to strengthen relationships with my
companion(s)..690
I cruise to strengthen relationships with my family/friend(s).
.663
Total variance explained 63.819Total scale reliability .874a Perception scale: 7 = strongly agree, 1 = strongly disagree
36
Policy Implications and Recommendations
This study analyzed the supply and demand of cruise related infrastructure, cruise product
offerings, and associated tourist attractions and services regionally. With a good understanding
of the market size and characteristics, competitive landscape particularly in the Pearl River Delta
region and broadly in Asia, and best practices of successful mature cruise hubs globally,
competitive strategies and policy implications were derived based on a triangulation analysis of
the information collected from various sources. The recommendations are classified into three
categories:
Demand side:
1. Market to a 3-hour radius region to maximize benefits from the Hong Kong-Zhuhai-
Macau Bridge and high speed rail
Guangzhou and Shenzhen residents reported positive perceptions of cruising from
Hong Kong and strong motivation to take a cruise holiday. As the transportation
network and accessibility to Hong Kong becomes enhanced, the primary source
market could be expanded to beyond the Guangdong Province. The 3-hour radius can
be redefined.
2. Increase Shenzhen and Guangzhou residents’ awareness of short-haul and long-haul
itineraries
37
When asked about what comes to their mind when thinking of cruises in Hong Kong,
ferries on the Victoria Harbour had the strongest image. Efforts should be stepped up
to inform Mainland residents of the variety of short- and long-haul cruise itineraries
so as to increase their desire and behavior of taking such cruises from Hong Kong.
3. Increase awareness/interest among Hong Kong residents of cruise holidays
Hong Kong residents generally reported lower perception, motivation, and intention
to take a cruise holiday from Hong Kong. More promotions could be launched to
inform residents of the variety of activities and facilities on modern day mega-cruises
to generate their interest in taking a cruise holiday. Cruise lines and travel agencies
could work with the media to produce television programs or community road shows
to increase awareness and interests.
4. Educate Asian consumers about the nature of cruise
Hong Kong residents reported the perception that cruises take longer than other forms
of travel and they would feel confined and uncomfortable while onboard cruise ships.
More consumer education may be required to inform Hong Kong and other Asian
residents that cruises are not merely a mode of transportation that takes passengers
from point A to point B. Instead, cruises are “floating resorts” that offer all-inclusive
vacation experiences. In addition, recent incidents of consumer boycott about the
change of cruise destination/itineraries due to poor weather conditions happened due
to the lack of understanding of the nature of cruise holidays.
38
Supply side:
1. Continue to promote Hong Kong and bring ship deployment
Efforts should be continued to bring more ship to Hong Kong, in particular to use
Hong Kong as a homeport, which could generate more economic benefits than port-
of-call.
2. Transportation to/from Kai Tak Cruise Terminal
The current transportation network around Kai Tai is insufficient during cruise days
when thousands of visitors arrive and depart. Public transportation options should be
explored to improve its accessibility.
3. Onboard immigration clearance
While there are cost and time issues involved, efforts should be made to facilitate
cruise lines and immigration department to work out feasible options so as to reduce
disembarkation time. This will allow travelers to spend more time in Hong Kong and
make the cruise journey more enjoyable.
4. Explore/develop new ports to expand itineraries
39
Distance between Hong Kong and the next available port creates a challenge for
Hong Kong as a homeport. The limited options available (e.g., Taiwan and Hainan)
also restrict the variety of itineraries that could be offered, which may reduce the
number of repeat cruisers starting their cruise journey from Hong Kong. It would be
worthwhile to work with cruise lines and neighboring governments to explore new
and or exotic ports to expand future itineraries. The variety of connecting ports and
itinerary options are also helpful in attracting cruise line to use Hong Kong as a
homeport.
5. Attract more cruise lines to use Hong Kong as their regional headquarter
Having one of the most attractive business environments in the world, Hong Kong
could be attractive to cruise lines to use the city as their regional headquarter. Once
they are headquartered in Hong Kong, it is more like that they will use Hong Kong as
a homeport and bring ships to visit Hong Kong as a port of call.
6. Cross-governmental agency collaboration
To develop Hong Kong into a regional cruise hub, various government departments
need to work together to resolve various issues, including transportation, visa/travel
permit, tourism related services, safety and security, and economic development.
40
Cross-community collaborations:
1. Regional collaboration
• Avoid duplication of offerings and promote distinctive positioning of each
port
Governments, port authorities, cruise lines and the travel trade of the Pearl
River Delta region should devise strategies and plans to avoid
homogeneity of cruise product offerings, which will cause direct
competition. By positioning each port differently and collaborate with
each other, win-win situations could be developed to collectively grow the
regional cruise market.
• PRC passport holders’ travel permit regulation
The current travel permit and visa regulations make the travel
cumbersome for PRC passport holders. Long lead time is required due to
multiple visa/travel permit application processes, which requires stronger
travel motivation to overcome these barriers and prohibits spur of the
moment travel decisions. As a main source market for Hong Kong,
Mainland Chinese cruise travelers’ visa requirements have a significant
impact on the development of Hong Kong as a regional cruise hub.
• Special visa arrangements for cruise passengers
41
Cruise itineraries in Asia are likely to include the visit of several countries
and economies. For many cruise travelers, multiple visa applications are
required. If governments in the region can discuss and agree on a special
“cruise visa” with which cruise travelers can apply for one visa and visit
all ports of call, that will greatly facilitate the cruise industry development
in the region.
2. Trade association
It would be helpful to have a platform for various stakeholders to communicate and
collaborate. The trade associations could include members from travel agencies,
cruise lines, Tourism Commission, Tourism Board, Travel Industry Council,
transportation sector, tourism educators, etc. to discuss and develop mutually
beneficial strategies and actions. The trade association could facilitate the
development of the cruise industry and may be regulate the trade.
3. Cruise research and education
The current suite of training programs is limited to cruise product selling. Most
tourism management related degree programs in Hong Kong only offers one elective
subject, if any, on cruise tourism. More training opportunities at the tertiary level
could be developed to nurture future cruise management professionals. This project
42
represents one of the few cruise related studies conducted in Asian context. More
research is required to further understand the supply and demand of this new form of
tourism and to monitor the growth and development of this segment of the tourism
industry.
With the four-stage process, all proposed research objectives have been successfully
accomplished.
Public Dissemination
The project results have been disseminated through the following means:
1. A public seminar was conducted in Hong Kong attended by more than 50 tourism and
cruise industry practitioners, government officials, the media, and university
students/staff. The seminar announcement is provided in Appendix B. Subsequent press
coverage of the seminar is summarized in Appendix C)
2. A press release was distributed reporting major findings of the study (see Appendix D).
3. The paper “Competitive Landscape of Asian Cruise Ports” was presented at the 2015
Travel and Tourism Research Association Annual Conference in Portland, Oregon, USA.
4. The Project leader has presented preliminary research results at the National Kaohsiung
University of Hospitality and Tourism, Taiwan and Macau Polytechnic Institute, Macau.
5. One manuscript has been submitted to the Journal of China Tourism Research. Another
paper is under preparation for submission to the Journal of Travel Research. Additional
journal papers could be prepared for information dissemination.
43
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46
Appendix A: Interview Guides
47
Interview Guide (Tourism Authority/Operator)
Infrastructure capacity
1. From the tourism infrastructure perspective, what is the maximum number of passengers
and crew that your city is prepared to handle simultaneously?
Probe: could you give us a brief introduction of tourism facilities in your city?
# of hotel rooms at different star ratings
# of eateries
# of travel agencies and tour buses
# of travel information points
Capacity and types of attractions
2. Are there any specialized human resources in your city that can support the development
of cruise tourism? If yes, please elaborate.
Probe:
# of specialized tour guides?
# of cruise specialists in travel agencies?
3. What is the annual (current or potential) economic contribution of cruise tourism to this
destination?
Strengths and Challenges
4. What role(s) do you think your city (port) plays in the development of cruise tourism in
the region (e.g., PRD, Florida, Mediterranean)?
5. What are the advantages and disadvantages of your city (port) compared to neighboring
ports in the region?
6. What (do you foresee) are the challenges that constrain the development potential of
cruise tourism in your city?
Probe:
Human capital knowledge/skills gap
The markets’ receptiveness to cruise tourism
Regional competition
48
Cruise passengers
7. What is (do you foresee will be) the approximate composition of cruise passengers
departing from your city in terms of their places of origin (State/Province, Country)?
8. How do cruise passengers usually (do you foresee the cruise passengers will) arrive at
your city (%)?
Probe: could you give us a brief introduction of intermodal transports in your city?
Airport capacity
Rail connections
Road infrastructure
9. Are you involved in selling cruise products (e.g., itineraries, shore excursions, etc.)? If
yes, what are your usual practices in selling these products?
Probe:
Are your marketing strategies effective? How are the markets responding to your
marketing effort?
Policies and regulations
10. What role(s) does/will your government play to support the development of cruise
tourism?
11. Are there national/regional policies that support the development of cruise tourism in
your city? If yes, please elaborate.
Probe:
Cabotage policy
Incentives to cruise lines, berth charges, subsidy
National tourism policy (incl. visa policy)
12. What are the major factors that negatively affect the growth of the cruise tourism in your
port/city? Any suggestions on how these constraints can be removed in the near future?
Others
13. Can you describe some cooperative (marketing) activities among cruise lines, the port,
and the city?
14. Please share your views on any other cruise-related issues.
49
Interview Guide (Port Authority/Management)
Port condition and management
15. From the port infrastructure and management perspective, what are the critical factors
that contribute to your (potential) success as one of the world (region)’s top cruise
homeports?
Probe:
Port infrastructure (berth, passenger terminal, etc.)
Port natural condition (weather, distance to nearby ports-of-call, etc.)
Port services to cruise lines and passengers (service range, quality, and efficiency)
Cost of port services
Port marketing (CRM)
Port governance (public vs. private; parent companies, etc.)
16. What is the maximum number of cruise ships, passengers and crew that you can handle
simultaneously?
Probe:
How do you come up with your human capital planning? (Staff-passenger ratio?)
How do you manage the people flow?
17. How do you attract cruise lines to use your port/terminal as a homeport?
18. Please list 2-3 ports/terminals that you consider as your major regional competitors.
19. Please name some distinctive competencies of your port/terminal comparing to
neighboring ports/terminals. What are your competitors’ core competencies?
20. Besides competition, do you cooperate with rival ports to promote regional cruise tourism?
Policies and regulations
21. Are there national/regional policies that support your development as a homeport? If yes,
please elaborate.
Probe:
Cabotage policy
Incentives to cruise lines, berth charges, subsidy
National tourism policy (incl. visa policy)
50
City infrastructure
22. Beyond the port/terminal, is there any support from the city that is also critical to your
success? If yes, please elaborate.
Probe:
Economic development (proximity to source markets)
Tourism infrastructure (attractions, accommodation, restaurants)
General infrastructure (intra-city transport, inter-city transport)
23. What is the annual (current or potential) economic contribution of cruise tourism to this
destination?
Others
24. Compared with your port, what do you think are Hong Kong’s advantages and
disadvantages?
25. Can you describe some cooperative (marketing) activities among cruise lines, the port,
and the city?
26. Please share your views on any other cruise-related issues.
51
Interview Guide (Cruise Lines)
Major considerations
27. When selecting homeport, what are the major considerations that are included in your
decision making model?
Probe:
Attractiveness and infrastructure development of the city
Economic development (proximity to source markets)
Tourism infrastructure (attractions, accommodation, restaurants)
General infrastructure (intra-city transport, inter-city transport)
Port infrastructure and management
Port infrastructure (berth, passenger terminal, etc.)
Port natural condition (weather, distance to nearby ports-of-call, etc.)
Port services to cruise lines and passengers (service range, quality, and
efficiency)
Cost of port services
Port marketing (CRM)
Political and regulatory framework
Cabotage policy
Incentives to cruise lines, berth charges, subsidy
National tourism policy (incl. visa policy)
28. How does XX (city) fit your criteria? What are XX (city)’s distinctive competencies
compared to neighboring ports/terminals?
29. Once you decide to select a particular port/terminal as homeport, what kind of support do
you need from various parties in the city?
Cruise passenger
30. What is the approximate composition of cruise passengers departing from XX (city) in
terms of their places of origin (State/Province, Country)?
31. How do cruise passengers usually arrive at XX (city) (%)?
32. Have you discovered any particular travel-related preferences of cruise passengers?
52
Probe:
Motivations
Activities/types of attractions preferred
Differences between Asian and Western cruisers
33. What is the annual economic contribution of your company using this destination as a
homeport?
Hong Kong’s competitiveness
34. Does your company plan to deploy more ships to Asia? If yes, what are your target
homeports?
35. Does your company plan to increase your Hong Kong coverage? By how much? Why?
36. Compared with other Asian ports such as Singapore and Shanghai, what are Hong Kong’s
advantages and disadvantages?
37. What are the major factors that negatively affect the growth of the cruise tourism in Hong
Kong? Any suggestions on how these constraints can be removed in the near future?
38. What suggestions can you provide to Hong Kong to develop it into a leading regional
cruise hub?
Others
39. Can you describe some cooperative (marketing) activities among your company, the port,
and the city?
40. Please share your views on any other cruise-related issues.
53
Appendix B: Public Seminar Announcement
54
Appendix C: Press Coverage
Press coverage on the press release "PolyU Presents Strategies and Policy Implications to Enhance Hong Kong’s Competitiveness as a Regional Cruise Hub" on the following website:
1. Hospitality Financial and Technology Professionals (HFTP) -http://www.hftp.org/index.cfm?feedItem=http://hftp2.hsyndicate.com/news/4072693.html#fullArticle
2. American Hotel & Lodging Association (AH&LA) -http://ahla.hsyndicate.com/news/4072693.html
3. Hospitality Sales and Marketing Association International (HSMAI) -http://www.hsmai.org/details.cfm?id=http://cdn.hsyndicate.com/econnect/4072693.html
4. Hsyndicate - http://www.hsyndicate.org/news/4072693.html5. Hospitality Net - http://www.hospitalitynet.org/news/4072693.html6. Hotel Technology Next Generation (HTNG) -
http://htng.hsyndicate.com/news//4072693.html7. Wiredhotelier.com - http://www.wiredhotelier.com/news/4072693.html8. AMFORHT - http://amforht.campusgroups.com/platform/blog/press-release--polyu-
presents-strategies-and-policy-implications-to-enhance-hong-kong-s-competitiveness-as-a-regional-cruise-hub/5764/
9. ChinaReviewNews.com - http://hk.crntt.com/crn-webapp/touch/detail.jsp?coluid=92&kindid=0&docid=104002503
10. Oriental Daily - http://orientaldaily.on.cc/cnt/news/20151113/00176_017.html11. The Sun - http://the-sun.on.cc/cnt/news/20151113/00407_014.html12. ON.CC - http://hk.on.cc/hk/bkn/cnt/news/20151112/bkn-20151112163642939-
1112_00822_001.html13. Chinese Television System -
http://news.cts.com.tw/crntt/international/201511/201511131682401.html#.VkVFor8j6x814. Sina - http://news.sina.com.tw/article/20151112/15532413.html15. HK China News Agency - http://www.hkcna.hk/content/2015/1112/411923.shtml16. Asian American Hotel Owners Association (AAHOA) -
http://aahoa.hsyndicate.com/news/4072693.html
55
Appendix D: Press Release
Hung Hom Kowloon Hong Kong
E paadmin@polyu.edu.hk T (852) 2766 5101 F (852) 2364 0246
Press Release
12 November 2015
PolyU Presents Strategies and Policy Implications to Enhance Hong Kong’s Competitiveness as a Regional Cruise Hub
The School of Hotel and Tourism Management (SHTM) of The Hong Kong Polytechnic University (PolyU) today (12 November) announced the findings of a study on “Enhancing Hong Kong’s Competitiveness as a Regional Cruise Hub from a Policy Perspective”. The study offers a comprehensive understanding of what it takes to become a competitive regional cruise hub.
Spearheaded by Professor Cathy Hsu, Principal Investigator and Chair Professor of the SHTM, and funded by the Central Policy Unit of the Hong Kong SAR Government, the project employed rigorous research methodologies, including interviews, focus groups, and survey, to systematically analyse the supply and demand factors, to develop effective strategies for Hong Kong’s development as a regional cruise hub and to draw implications for the formulation of future cruise tourism related polices.
The cruise industry has experienced a stable growth with an average of 7.2% annual growth rate of passenger numbers since 1990. The rising role of Asia in the global economy in recent years has drawn much attention to the Asia-Pacific region and the cruise industry has started to explore new markets in Asia. This is particularly true for the Mainland China market as the number of Mainland Chinese tourists taking cruises is expected to surpass 1 million for the first time in 2015. The rapid growth of the cruise industry in Asia provides excellent opportunities as well as raises big challenges to Hong Kong.
“The newly launched HK$8.2 billion Kai Tak Cruise Terminal represents the Hong Kong government’s firm commitment to establish Hong Kong as a regional cruise hub,” said Professor Cathy Hsu. “While the development of port infrastructures in Asian cities and the growth of the Chinese outbound travel market reinforce Hong Kong’s role, the city is also facing fierce competition from neighbouring ports such as Shenzhen and Guangzhou”, Professor Hsu observed. Indeed, Singapore and Shanghai have declared their plan of being a regional cruise hub. Neighbouring economies such as Vietnam, South Korea, and Taiwan are aggressively expanding their cruise port infrastructure and trying to capture the rapidly growing Asian cruise traveller market.
With a comprehensive understanding of the competitive landscape, the project team presented strategies and policy implications in an attempt to facilitate the Hong Kong government to formulate and implement cruise tourism related policies in support of the development of Hong Kong as a regional cruise hub:
Appendix D - English Press Release
Hung Hom Kowloon Hong Kong
E paadmin@polyu.edu.hk T (852) 2766 5101 F (852) 2364 0246
Press Release
1. Demand side: o Market to a 3-hour radius region, maximising the benefits of Hong
Kong-Zhuhai-Macau bridge and high speed rail o Increase Mainland residents’ awareness of short-haul and long-haul itineraries o Increase awareness/interest among Hong Kong residents of cruise holidays o Educate Asian consumers about the nature of cruise
2. Supply side: o Continue to promote Hong Kong and bring ship deployment o Strengthen transportation to/from Kai Tak Cruise Terminal o Encourage onboard immigration clearance o Explore/develop new neighbouring ports to expand itineraries o Attract more cruise lines to use Hong Kong as their (regional) headquarters o Initiate cross-governmental agency collaboration
3. Cross-community collaborations: o Regional collaboration
Avoid duplication of offerings and promote distinctive positioning of each port
Relax PRC passport holders’ cruise travel permit regulation Arrange special visas for cruise passengers
o Trade association o Cruise research and education
Located at a strategic geographical position in the Asia-Pacific region, Hong Kong has been a must-see destination for cruise passengers and other international tourists visiting Asia. But with more and more Asian countries and regions joining the cruise tourism business, Hong Kong needs to further develop its competitive advantages and consolidate its position as a preferred port for cruise lines and cruise travel. “This study provides important information for the Hong Kong government to formulate strategic plans and draw policy implications to support the development of Hong Kong’s cruise industry” Prof Hsu remarked. “The SHTM is proud to be able to support the development of the cruise industry in this significant way.”
About PolyU’s School of Hotel and Tourism Management
For over 35 years, PolyU’s School of Hotel and Tourism Management has refined a distinctive vision of hospitality and tourism education and become a world-leading hotel and tourism school. Ranked no. 2 in the world, the School is a symbol of excellence in the field, exemplifying its motto of Leading Hospitality and Tourism.
With 65 academic staff drawing from 20 countries and regions, the School offers programmes at levels ranging from undergraduate degrees to doctoral degrees. A member of the UNWTO Knowledge Network, the School was bestowed the McCool Breakthrough Award in 2012 by
Hung Hom Kowloon Hong Kong
E paadmin@polyu.edu.hk T (852) 2766 5101 F (852) 2364 0246
Press Release
the International Council on Hotel, Restaurant, and Institutional Education (I-CHRIE) recognising its breakthrough in the form of its teaching and research hotel – Hotel ICON – the heart of the School’s innovative approach to hospitality and tourism education.
*****
Press contact : Ms Pauline Ngan, Senior Marketing Manager School of Hotel and Tourism Management
Telephone : (852) 3400 2634 E-mail : pauline.ngan@polyu.edu.hk Website : www.polyu.edu.hk/htm
Hung Hom Kowloon Hong Kong
E paadmin@polyu.edu.hk T (852) 2766 5101 F (852) 2364 0246
Press Release
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Appendix D - Chinese Press Release
Hung Hom Kowloon Hong Kong
E paadmin@polyu.edu.hk T (852) 2766 5101 F (852) 2364 0246
Press Release
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(UNWTO)(I CHRIE) McCool
*****
(852) 3400 2634 pauline.ngan@polyu.edu.hkwww.polyu.edu.hk/htm
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