The Alipay Chinese online payment service provider was recently deployed on Tallink Grupp’s Megastar vessel.

Baltic cruise and ferry operator AS Tallink Grupp is expecting a 10-15% increase in Asian passengers across its entire fleet by the end of 2018.

The company, which operates routes between Estonia and Finland, Estonia and Sweden, Finland and Sweden, and Latvia and Sweden, handled 9.8m pax in 2017.

According to Tallink, 48% of its passenger mix was Finnish, 19% Estonian, 12% Swedish, 4% Latvian, 2% Russian and 2% Lithuanian. Chinese made up 10% of the remaining 13% of total pax.

Total revenue amounted to €967m ($1.1bn) last year, with the Estonia to Finland route generating 37% of that revenue.

As reported, revenue from shops and restaurants amounted to €536.7m ($661.5m) in 2017, up from €521.5m the previous year.

Since the beginning of 2018, Tallink’s vessels have transported over 250,000 Asian passengers. The Tallinn-Helsinki route has carried almost 45,000 more Asian tourists in the first six months of the year, compared to the corresponding period in 2017.

SAILING ‘OUT OF ITS COMFORT ZONE’

In an extensive interview with TRBusiness, Tallink Duty Free Director of Business Development Magnus Skjörshammer reveals how the company must move ‘out of its comfort zone’ to expand and not simply focus on the Nordic region.

He explained: “We are bringing in passengers from outside the Nordics, which has led to an increase in Asian passengers, particularly mainland Chinese. We have also had a lot of travellers from Korea.

“Growth has been gradual, but we have always had a certain number of Asian pax, particularly from Japan. Maybe the biggest increase has been in the last four or five years.”

Regarding the aforementioned 10-15% expected Asian pax increase, Skjörshammer said: “This is quite a lot, especially if you keep in mind they purchase more per pax than the average Nordic equivalent.”

Asian shopping hosts speaking multiple languages are available to assist customers.

This month, Tallink became the first Estonian company to introduce the Alipay Chinese online payment service on its Megastar and Star vessels.

The aim is to accommodate the high spending Asian consumers, acknowledged Skjörshammer. “We already had Union Pay and discovered that when we introduce familiar payment systems, spend per passenger increases fourfold.”

Working with a completely different culture may be interesting, but is also challenging says Skjörshammer: “We are used to working with a Nordic culture where many people are introverts and do not need or want assistance on board. Now we are working with passengers from others parts of the world who actually expect to be assisted.

“As soon as they step on board, they really like to know what to buy and what the top-sellers are. Our sales staff have been briefed accordingly.”

Magnus Skjörshammer, Director of Business Development, Tallink Duty Free.

GIFTING PREFERENCE

When it comes to beauty, strong brands such as Parfums Christian Dior and Estée Lauder are the most popular among Asian consumers.

But according to Skjörshammer, they are also very interested in Nordic products.

“Finnish Cosmetic brand Lumene is a strong brand for Asian travellers along with L’Occitane and multi-pack hand-creams. These are all typical purchases among Asian travellers. Marimeko, another Finnish brand, also has strong appeal.”

Skjörshammer comments that Asian pax are ‘obviously’ interested in Asian brands, but says their focus is very much on gifting. This is contrary to Nordic pax who tend to purchase more for themselves.

In terms of confectionery, fashion, watches, sunglasses and bags, “brands such as Furla, Coccinelle and Bally are extremely popular”, continued Skjörshammer. He added: “We also sell a lot of Ecco shoes to Asian travellers, while Gucci and Swarovski are strong performers.”

OTHER NATIONALITIES

Attracting other nationalities in addition to Asians and accommodating their needs on board is unsurprisingly a significant focus.

“We are not going to evolve the business by concentrating on pax from this [Nordics] area. There are only a few players in this region and we have more or less half the market share. We must reach outside our borders in order to expand.

“Our marketing department is working with travel agents outside the Nordic region and EU, which is why we have web sales sites in 17 languages. Southern Europe, Asia, South America and North America is where we are expanding.”

A multi-lingual work force and digital touch-screens in different languages enhances the experience for non-English speaking pax, TRBusiness learns.

“This is the only way we can do it as a lot of these people don’t speak English,” he said.”Language is an important issue.”

Fashion outlet onboard the Baltic Princess. Source: AS Tallink Grupp/Hannu Nieminen.

Inside shops, touchscreens are used to scan products and provide information about them in different languages. In restaurants, they offer menus in various languages chosen by customers.

Skjörshammer added: “They can also be used elsewhere to obtain general information in several languages such as where cabins are located, where shops can be found and what their opening times are.”

The range of services is clearly expanding, but so is the product mix with new items not previously listed. Examples include Chanel Soleil Tan de Chanel (bronzing make-up) and whitening cream.

“These are on the same shelf catering for two different kinds of passenger which are complete opposites. This is something we are not used to and it is a challenge to work in this direction.”

Watch out for the September edition of TRBusiness for more from Tallink Duty Free Director of Business Development Magnus Skjörshammer.

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*Main image of Silja Symphony courtesy of AS Tallink Grupp/Marko Stampehl