At its Investor Day in May, Norwegian Cruise Line Holdings introduced a term: ROEx, short for return on experience. It means delivering experiences that customers want in an efficient way.
In an on-stage discussion at CruiseWorld, Travel Weekly editor in chief Arnie Weissmann asked the man who came up with that term, NCLH CEO Harry Sommer, to elaborate on ROEx.
Sommer compared the philosophies of former CEOs Kevin Sheehan and Frank Del Rio, describing Sheehan as a "CFO by trade" who emphasized return on investment (ROI) with a focus on maximizing financial returns. In contrast, Sommer regarded Del Rio, his mentor, as someone committed to providing exceptional guest experiences, although this sometimes led to offering experiences that did not align with guests' preferences.
Sommer highlighted the sculpture garden on the Norwegian Prima, a ship that launched in 2022, as an example of Del Rio's passion for art and decor, which he carried over from Oceania Cruises. However, Sommer noted that while the garden is visually appealing, it did not resonate with Norwegian Cruise Line guests, who did not necessarily value that experience.
Now, NCLH aims to "focus on providing guests with experiences that they value," which combines the best of the Sheehan and Del Rio philosophies, Sommer said. And so, ROEx is being applied to food, entertainment, amenities, destinations, excursions – any experience or amenity that touches the guest. The company uses data from guest satisfaction scores to help uncover what guests are willing to pay for.
Sommer recalled that in his first week as CEO, about a year-and-a-half ago, he asked the head of hotel operations for a list of all the meals that guests ordered, a request that drew a surprised reaction.
"He said, 'No one's ever asked me for this,'" Sommer said. "Well, if we serve meals that guests don't want, then let's stop preparing them, because it just adds waste into the system and distracts us from better preparing the meals that guests do want."
Sommer says the ROEx philosophy is working, as shown by guest satisfaction scores, which are "the highest they have ever been across all three brands." He called the company's record financial results "the cherry on top."
Source: Travel Weekly