Cruise Liner Schedule

Jason Deleon Steve Rockwell

Will Wathen

Background

• Vacation Cruise Industry (2012)– Over 20 Million passengers – Generated over $42 Billion in economic activity (US)

• OR Consultants hired by Major Cruise Liner– Analyze current voyage network– Minimize cost– Itinerary recommendations– Analyze resiliency of network– Impacts of catalysts

*Paid hefty sum for analysis, no need to question resultsM

Real World Problem

• Network Design• Measures of Effectiveness on an itinerary for

an n day cruise– Cost (Transit and Port Fees)– Fun - Utility

• Analyze effects of desired fun– Relate to target demographics

• Impacts of catalyst i.e. weather, coup

M

Network Map Overview

M

Network Description

• Cruise Liner Voyage Network

– Consists of all possible voyage routes  

– Connects all possible ports for a particular cruise liner (Royal Caribbean)

– Time-layered network • Each layer is a day

M

Network Design

• Nodes: Port on a given cruise day i.e Haiti 3– 16 Ports x 8 days = 128 nodes – S & T = Homeport = Fort Lauderdale, FL

• Node Data: Fun Factor, Lat/Long

• Edges: Connection of two ports from one time layer to another

– Bahamas 2 ------ Haiti 4 (Two Day Transit)

• Edge Data: Cost = Transit Cost + Port FeesM

Five Day Time Layer Network (Subset)

Day 0

Day 5

Day 4

Day 2

Day 3

Day 1

HA

BAH HA DR

DRHABAHFL

DR

FL

FL BAH

BAHFL

BAHFL

BAH HA DRFL

HA DR

HA DR

Five Day Time Layer Network (Subset)

Day 0

Day 5

Day 4

Day 2

Day 3

Day 1

HA

BAH HA DR

DRHABAHFL

DR

FL

FL BAH

BAHFL

BAHFL

BAH HA DRFL

HA DR

HA DR

Nodes

M

Start/End Node

M

Example of Route

M

Day 0

Day 1

Day 3

Day 2

Day 5

Mathematical Model

Shortest Path MILP• Minimizing Port Costs & Transit Costs • Netflow Constraints

• Design Constraints (Real World):• No overnight stays in port• Cannot return to visited port other than Homeport• Length of cruise in days

• AnalysisFun Factor constraint

M

Assumptions

• Direct Path - Navigable Route• Great Circle Distance• Average Speed of ship is constant : 25 knots• Max Range: 400 NM/day• Fun Factor: Excursions/Affordability• Port Fees: $10-$25 per person. • Haiti- $0 port fees - Long Term Lease in

Labadee (Royal Caribbean).

M

Situation Dependent Variables

• Travel Miles per day• Cruise Length in days• Cost of Fuel• Fuel Consumption rate• Ship speed • Port Fees• Fun Factor• Range/day* All Variables can be modified to correspond to real cruise network

M

Results: Min Cost

• 5-day Route:– FortLaud0, Bahamas1, Haiti3, FortLaud5– Cost: $425,194

• 7 -day Route: – FortLaud0, CaymanI2, Haiti4, Bahamas6, FortLaud7– Cost: $ 610,296

• 10-day Route:– FortLaud0, Bahamas1, StThomas4, PuertoRico5,

StMaarten6, Haiti8, FortLaud10– Cost: $ 891,990

M

Adding Utility

• Added Utility to the model– Fun Factor

• Utilized Constraint to ensure a certain level of “Fun”

• Increased Fun Factor from minimal feasible solution to maximum feasible solution

– Cost Vs. Fun Relationship– Demographic Comparisons

M

Utility: Fun Factor

• Cruise Length Fixed at 7 days• 16: FortLaud0, Bahamas1, Haiti3 , CaymanI5, FortLaud7

– Cost: $ 610,296 • 19: FortLaud0, CaymanI2 , DomRep4, Bahamas6, FortLaud7

– Cost: $ 721,276 • 21: FortLaud0, StThomas3, PuertoRico4, DomRep5, FortLaud7

– Cost: $ 751,934

• 22: FortLaud0, StMaarten3, StThomas4, DomRep5, FortLaud7 – Cost: $ 836,982

• 24: FortLaud0, DomRep2 , Aruba3 , CaymanI5, FortLaud7 – Cost: $ 902,282

M

Fun Factor vs. Cost

P

Target Market (<$75k)

- Marketing cruises based upon demographic.- Design cruise for family with combined income <$75k (~35% of passengers).

- Priority of customer may be price and not necessarily itinerary.

- Example: 16: FortLaud0, Bahamas1, Haiti3 , CaymanI5, FortLaud7

Cost: $ 610,296

Target Market (>$75k)

- Marketing cruises based upon demographic.- Design cruise for family with combined income >$75k (~65% of passengers).

- Priority of customer may be itinerary and not necessarily price.

- Example: - 24: FortLaud0, DomRep2 , Aruba3 , CaymanI5, FortLaud7

Cost: $ 902,282

Multi-Segment Strategy

- Utilizing a strategy to target multiple market segments that are based upon demographics.

- If only one itinerary is marketed, what would attract the most customers?

- Low price while providing moderate/high level of fun factor.

-Example:• 21: FortLaud0, StThomas3, PuertoRico4, DomRep5, FortLaud7

– Cost: $ 751,934

Attack

Attack

Scenario:• 7- day Itinerary for “most fun” cruise route• 2 days prior to departure

– Hurricane Thelma hits– Randomly takes out ports– Follow on attacks

• Consultants called to find alternate route with a near equivalent fun factor

Max Fun Route - No Attack

M

1 Attack

M

2 Attacks

M

3 Attacks

M

4 Attacks

M

5 Attacks

M

6 Attacks

M

7 Attacks

M

8 Attacks

M

9 Attacks

M

10 Attacks

M

Resiliency

Conclusion

• Shortest Path MILP– Minimizing Port Costs & Transit Costs– Analyzed impact of Fun Factor

• Positive Correlation (Fun & Cost)– Most Fun Cruise 1.5X as expensive as least Fun– Translates directly to Customer– Recommended Cruises based on Utility value

• Effects of Attacks & Resilience• Key Take-aways

P

Follow-on Work

-Enable User Interface -Multiple Cruise Ship Types-Alternate Homeport Analysis-Add Granularity Detailed Routes, Detailed Cost Variables

-Model Risks of traversing Bermuda Triangle

References

-crusing.org/regulatory/issues-facts-cruiseweb.com/royal-caribbean/eastern-caribbean/#itineraries

-vacationstogo.com/cruise_port/Caribbean.cfm-www.timeanddate.com/-www.latlong.net/ -www.cruisemarketwatch.com

-Professor Ned Dimitrov’s Brain

Questions?Cruise Liner Schedule

P