Private Islands and Cruise Line Success: The Growing Trend

Cruise lines are banking on a new destination type to help them boost revenue, and it’s not emerging destinations like Dominica or those currently trending, like Costa Rica: it’s their own private islands. 

Many of the major cruise lines now offer at least one private island experience in the Caribbean region: Royal Caribbean was one of the first, with the launch of Perfect Day at CocoCay, and it recently announced it would build another Perfect Day experience, this time in Mexico. Disney Cruise Line has its Lookout Cay, MSC Cruises has its Ocean Cay MSC Marine Reserve, Norwegian has its Great Stirrup Cay…and the list goes on. 

The reason for their popularity and their economic benefit to cruise lines should be pretty straightforward: they’re a destination owned and operated by lines themselves, allowing the cruise lines to grow revenue without paying governmental fees like taxes and port charges. 

“Perfect Day at CocoCay has been a game changer for both our guests and our business,” said Jason Liberty, president and chief executive officer of Royal Caribbean Group upon the announcement of the line’s second Perfect Day destination. “With travelers prioritizing unique experiences and destinations driving their booking decisions, we’re excited to expand our Perfect Day Collection by creating Perfect Day Mexico to super serve guests who want to explore the Western Caribbean.”

According to Reuters, private islands have been part of cruise lines’ success: Royal Caribbean’s expenses have increased 34 percent from when Perfect Day at CocoCay opened in 2019, but revenues have also increased 43 percent. Another key factor: visitation to private islands has grown year over year from July 2023 to July 2024 faster than visitation to non-private islands in the Caribbean: 41 percent to 18 percent. 

Nonetheless, the private islands still welcome less people due to capacity. The past year saw about 10 million people visiting the islands, whereas other destinations in the Caribbean welcomed 57 million cruise passengers. 

There are twelve private cruise destinations in the Caribbean, with more on the way, like Carnival’s Celebration Key, which will debut in 2025 with a price tag of around $600 million. It’s clear that private destinations for cruise lines are here to stay, and are only expected to grow. 

This article originally appeared in TravelPulse.

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