Get All Access for $5/mo

Why Royal Caribbean Isn't Going All in on Massive Cruise Ships Despite the Wild Success of Its New Icon of the Seas Giant mass-market floating resorts usually attract first-time cruisers and families, but more seasoned travelers have been opting for quieter ships with more bespoke itineraries.

By Brittany Chang

Key Takeaways

  • Royal Caribbean International has unveiled a swath of giant cruise ships over the past few years.
  • Its CEO said its new world's largest ship, the Icon of the Seas, is its "best-selling product" ever.
  • But the cruise line doesn't plan on going all in on megaships forever.
Brittany Chang/Business Insider
Royal Caribbean has seen great success with its mega cruise liners. Despite this, the company is now considering a new, smaller class of ships.

This article originally appeared on Business Insider.

Earlier this year, guests at Royal Caribbean's Perfect Day at CocoCay private island were the first to revel at the historic sight of the world's largest cruise ships, Icon of the Seas and Wonder of the Seas, docked side-by-side.

The vessels towered over their communal dock like skyscrapers, casting a dark shadow over their relatively tiny shared pier.

Together, they can accommodate about 19,250 people.

Wonder of the Seas and Icon of the Seas docked at Perfect Day at CocoCay

Cruise ships like the Icon of the Seas will spend the majority of their trip at sea. Pieter De Boer via BI

At 1,196 feet long and weighing 248,663 gross tons, the Icon of the Seas is a sight to behold. When it launched in late January, the giant vessel upstaged its eight-foot shorter predecessor, the Wonder of the Seas, as the world's biggest.

At the time, it was no surprise: Every new Royal Caribbean ship seemed to dethrone another Royal Caribbean ship for this title.

But not for long.

The company's smaller ships, important for diverse trips, are aging.

Icon of the Seas' outdoor decks

Royal Caribbean saw the largest booking day ever when reservations opened for the Icon of the Seas in October 2022 — more than a year before the ship's official launch. Brittany Chang/Business Insider

The company is synonymous with its mega vessels. And they've been mega-hits: Michael Bayley, the president and CEO of Royal Caribbean International, has repeatedly called the Icon of the Seas the "best-selling product" in the company's history.

Royal Caribbean is set to launch four more megaships by 2028 — representing about a third of its total fleet. So far, most of the megaships' scheduled sailings are in the Caribbean.

The other 21 smaller vessels tend to have more specialized itineraries, Patrick Scholes, the managing director of lodging and leisure-equity research at Truist Securities, told Business Insider.

aerial of the Quantum of the Seas

Royal Caribbean International via BI

Given their trimmer sizes, these vessels can operate more sailings outside the Caribbean, which often reel in high fares and customer satisfaction for the company, Jay Schneider, the chief product-innovation officer at Royal Caribbean Group, told reporters in January. Think of the Mediterranean, Alaska, and South Pacific itineraries — the latter are especially important as the cruise line continues to ramp up business in Asia.

But these destination-flexible cruise liners are aging as Royal Caribbean continues to unveil their giant counterparts. The company launched its four oldest Vision-class ships, with a maximum 2,730-guest capacity, between 1996 and 1998.

They're tiny and old compared to the 2-month-old, 7,600-guest Icon of the Seas.

Looking ahead, Royal Caribbean plans to return to the basics: smaller cruise ships.

Grandeur of the Seas

Royal Caribbean's oldest ship is the 2,440-guest Grandeur of the Seas, which first set sail on December 14, 1996. Royal Caribbean International via BI

Despite the cruise line's success with mega-vessels, Schneider said Royal Caribbean is now considering a new class of ships that would start "smaller" — noting that he was "careful to say small, but less-than-large."

"The reality is, families want to go on vacations not just in the Western and Eastern Caribbean where a ship like Icon can get into," Schneider said. "They want to stay with our brand and journey to different destinations that require more versatility in ship size."

Desirable destinations such as French Polynesia and Venice, Italy, have limited visiting cruises, including size restrictions, to curb pollution and overcrowding. But, as Schneider said, small-vessel-enabled specialized itineraries are also important to travelers.

regent seven seas grandeur's pool deck

The pool was surrounded by several hot tubs. Brittany Chang/Business Insider

Giant mass-market floating resorts also often attract first-time cruisers, enamored by their family-friendly water parks and Broadway-style shows. But after a few good vacations at sea, these no-longer-new-to-cruising guests might start craving quieter ships or more bespoke itineraries.

"Alaska cruises tend not to be the first-time cruiser," Scholes told BI. "I don't really see Icon of the Seas doing a Norwegian Fjord or Alaska trip."

Plus, "there's probably only so much demand for these giant ships," Scholes said.

Royal Caribbean has already succeeded in the first part: bringing in a swath of new cruisers with its megaships. Now, it has to retain them.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Growing a Business

4 Ways I Grew My Business From Startup to 17 Years of Sustained Success

Whatever the future holds, remembering these four lessons will help sustain and scale your startup to a lasting legacy.

Side Hustle

This 20-Year-Old Student Started a Side Hustle With $400 — and It Earned $150,000 Over the Summer

Jacob Shaidle launched his barbecue cleaning business Shaidle Cleaning in 2021 when he was just 15.

Business News

Barbara Corcoran Says This Is the One Question to Ask Before Selling Your Home

Barbara Corcoran sold The Corcoran Group in 2001 for $66 million.

Business News

Google Says It Won't Follow Amazon's Lead With a Return-to-Office Mandate — Yet

In a town hall, Google leaders told staff the current hybrid plan will stay in place.

Business News

'Not a Big Deal': Barbara Corcoran Says the NAR Ruling Hasn't Had Much of an Impact So Far

The ruling removes the commission rate that home sellers are expected to pay.