Royal Caribbean Cruise Line Readies a Huge CocoCay Change (Will it Be Perfect?) – TheStreet

For some cruise line passengers, the ship is the destination. That's especially true with Royal Caribbean (RCL) - Get Royal Caribbean Group Report and Carnival Cruise Lines (CCL) - Get Carnival Corporation Report which have steadily raised the bar when it comes to onboard experiences.

Carnival has added a roller coaster on its latest, the Mardi Gras, while Royal Caribbean has bumper cars as part of its unique "Seaplex" on Odyssey of the Seas, and an array of new and reimagined experiences on Wonder of the Seas, the biggest cruise ship in the world.

Both companies, of course, also have more ships coming with Carnival Celebration and Royal Caribbean's newest Oasis-class Utopia of the Seas and the brand-new first-of-its-kind Icon Class Icon of the Seas being built now. The ships, however, no matter how amazing they are, aren't just floating mega-hotels, they're also transportation.

And, while you can't underestimate how important customers consider being able to sail on the latest and greatest ship, they also care about where they are going. In one major area, at least when it comes to destinations, Royal Caribbean has built a big lead over not just Carnival, but also Norwegian. That's an edge that's also about to get bigger.

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For decades cruise lines did things the same way when it came to their private island destinations. A private island meant a beach with chairs, maybe a kids' play area, a barbecue-style meal, bars, and not much else.

Royal Caribbean's Perfect Day at CocoCay changed that. The reimagined island has multiple beaches, a gigantic pool (the largest one in the Caribbean), an added-fee waterpark with multiple slides and a wave pool, an extra-cost high-end beach club, as well as ziplines and a tethered hot air balloon that the company sells tickets for.

CocoCay has a lot you can do for free -- dramatically more than the sparse private islands offered by Carnival and Norwegain Cruise Line (NCLH) - Get Norwegian Cruise Line Holdings Ltd. Report -- but it also has a lot of other experiences. Without the added fee experiences, Royal Caribbeaan has the best private island due to its multiple beaches and the huge pool, but the total package gives the company a major advantage over its two chief rivals.

The company has decided to lean into that advantage with an upcoming expansion of the private island.

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"On the destination front, we continue to make progress on the expansion of perfect day at CocoCay with the addition of Hideaway Beach. Hideaway Beach will make perfect day at CocoCay even more perfect with an entirely new experience expanding capacity to the island," CEO Jason Liberty shared during the company's first-quarter earnings call.

Hideaway beach will be an adults-only section of CocoCay. The company has not shared whether it will come with an added charge. (Royal Caribbean has an adults-only "Solarium" on most of its ships that does not cost extra for passengers).

CFO Naftali Holtz declined to say whether the company had decided on whether the new area of CocoCay would be an added charge during a recent call with TheStreet.

Carnival and Norwegian have not put the same level of investment in their private islands. And while there are some cruise passengers who want a more unspoiled island experience, the reality is that CocoCay offers Royal Caribbean a major advantage.

It has classic beach areas where the cruise line has done little more than put out chairs. CocoCay also has the pool, complete with a huge pool bar, that neither of its rivals offers as well as the many added charge experiences on the island.

You can go to CocoCay and not spend an extra dime and still get a better, move varied experience than what Carnival and Norwegian offer. You can also opt to spend more and get access to the beach club and the water park which are premium experiences.

Hideaway Beach -- whether it be free or an upcharge -- will add to passengers choices on the island. That's something Royal Caribbean's rivals do not offer and it's a massive advantage which makes CocoCay a premium destination rather than simply a beach day.

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Royal Caribbean Cruise Line Readies a Huge CocoCay Change (Will it Be Perfect?) - TheStreet