The Carnival Cruise Lines case focuses on how Carnival Cruise Lines should strategically exploit enterprise systems and available customer data to perpetuate its success. Specifically, it focuses on the role that Customer Relationship Management (CRM) can play in organizational strategy. Case Questions:
1) Highlight the key characteristics of Carnival Cruises' competitive environment (e.g., major competitors, market position, customers and distribution channels, threat of new entrants, threat of product substitutes)?
2) Describe the IT infrastructure (consider Weill’s article) at Carnival Cruise Lines and the role (current & potential) it plays supporting processes, people and strategy. Given Carnival’s IT
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Product design of fun ship depended on providing quality cruise vacations that exceed customer expectations and needs, Carnival considered it as one of its critical success factors.
Carnival’s conservative stance toward IT was also thought to have paid dividends due to the low success rate of many companies who tried the CRM approach.
2. Should CCL develop a CRM strategy? Why, and for what purpose?
Yes, because they want to know their customers better by analyzing data with the purpose of gaining new customers and increasing the loyalty from existing customers. Carnival was just beginning to experiment with loyalty program to incent customers to spend more money on board; and there was growing recognition at carnival of the value of business intelligence about customers to solve complaints. Also, the firm had the experience of a sophisticated revenue management group since 1999th at is using inventory, pricing and booking data to optimally price each cruise and understand performance of agents.
3. How should CCL approach the implementation of a CRM strategy?
Currently, CCL only devoted a fraction of a full-time equivalent employee to customer data analysis, though several data analytic projects were currently in the work. Basically CCL should take into consideration the following:
(1) Hire or contract specialized consultants to help in the implementation; (2) Verify the accuracy
A pause strategy is the best initial course of action for Carnival Corporation to improve on its health standards, overall safety and public relations. This allows the corporation to consolidate its resources to take more precise action towards its critical issues. Taking a pause strategy approach the corporation can put its growth strategy on temporary hold, keying in on improving ship infrastructure and implementing better safety features. Carnival can begin by issuing more frequent maintenance and upkeep of ships, improving the diligence of sanitization of surfaces, and executing better care and handling of perishables. This strategy gives Carnival Corporation the opportunity to show progressive action towards improving overall customer health and safety. Carnival can then utilize this to apply a marketing strategy showcasing its efforts to continually keep customer wellbeing at its
Question 5: What threats exist for the future performance of the cruise-line industry and, specifically, of Carnival Cruise Lines? If you were in charge of Carnival, how would you (a) try to prevent these threats from becoming reality and (b) deal with them if they did become reality?
Carnival Corporation & plc is a global contender with the title of the world’s largest cruise and leisure travel company. The goal of this assessment is to analyze the strengths and weaknesses with the financial ratio analysis of the company along with conducting an internal factor evaluation matrix to view the status of the company in comparison with their top competitor, Royal Caribbean Cruises Ltd.
Taking advantages of the special tax loopholes Carnival has been avoiding to pay US corporation taxes, however back in 2009 the US government and the IRS started a movement to close those loopholes. If these loopholes are closed, it could affect their financial statements and fiscal bottom line in the future.
1. Compare and contrast the use of IT in an “information Age” company versus that in an “industrial Age” company? Is Cisco an Information Age company? Why?
Carnival Cruise’s, Disney Cruises and Norwegian was the only other clear competitors to RCL but in terms of subsidiaries Crystal Cruises was the only direct rival in terms of size and scale and position in the industry but in analyzing the demand increase from 1999 to 2001 a 16.7% increase in demand showed that Celebrity cruises had to maintain their position as a luxury brand to continue being a major player in the industry. The demand was strong and the competition was average, as it relates to entries to market the cruise line industry requires multiple stipulations and regulations required thus unless one of the major players mentioned above acquired a smaller cruise line to increase in operations and services Celebrity’s position was relatively strategic and smart. The competitive landscape was relatively small so quality improvement process should be the main focus during this time, they already created the process needed to offer superior service thus tweaks such as management training, career progression programs and increases in standard of performance programs would set Celebrity’s consistent quality assurance position in the industry to better
Diamond Cluster Entertainment is trying to build a solid relationship with their loyal customers. For the past few year customer satisfaction have declined
Carnival Corporation & plc. is a global company with over 100,000 employees that serve 5 million passengers a year. At the end of 2014 Carnival Corporation & plc. income earnings were $15,884,000 dollars. Tickets sales at $11,889,000 dollars. After paying salaries and other fees Carnival Corporation & plc. income came to $459,000 which is low considering that in 2012 and 2013 income was over $1,070,000 dollars for each year after deducting costs. (Financial Information) The total sales come for the different age demographics, so approximately 50 percent of the predictions for cruise come from the 25-39 age group followed by the 40-59 age group at about 39 percent and the 60 plus age group at 11 percent. (Cruise Demographics)
They make it enjoyable for all by adding value to the many different activities that they have on and off board. Carnival Cruise wants to be known as a cruise that instills a great time no matter what. Their rapid growth is simply amazing, due to the great people that work on their marketing team. When you think of some of the top companies in the world today, Carnival Cruise has to be one of those companies. They are the leader of the cruise line industry, and they will continue to be the leader of the cruise line industry, because they are able to adapt to the times.
Porter’s 5 forces model allows to analyse the factors outside the Cruise industry that influence the nature of Carnival competition within it, the forces inside the Cruise industry that influence the way in which Carnival compete, and so the company’s likely profitability. With an understanding of where power lies, Carnival can take advantages of a situation of strength, improve a situation of weakness and avoid taking wrong strategies. Porter has identified five competitive forces that shape every industry and every market: bargaining power of suppliers, bargaining power of buyers, threat of new entrants, threat of substitutes and rivalry among competitors. A sixth element has also been added
Carnival’s value proposition was to be a cheaper alternative to land vacations at all inclusive resorts while providing a variety of activities and destinations in one trip. Carnival was the “fun ship”, providing contemporary vacationing to first-time and repeat cruisers. Because customer retention is low, Carnival uses a more traditional style of marketing, focusing on the short-term customer.
Question 1: How can an effective Customer Relationship Management program be used to identify, retain, satisfy and retain customers?
There are nine main cruise line, these include Ambassador International, Carnival Corporation, Crystal Cruises, Disney Cruise Lines, Louis Cruises, Regent Seven Seas Cruise Lines, Royal Caribbean Cruises Ltd., Silversea Cruises and Star Cruises (Cruising). The major cruises out of these are Royal Caribbean and Carnival Corporation. These cruises line are known for using their popularity to their advantage by raising their prices at any given time. But on the other hand, all the ships are comparable. All passage can anticipate the equivalent experience on board. In addition Rivalry is at a peek because getting rid of a cruise industry cost more than to just keep into development.
The use of CRM could also be used to target specific marketing programs for individual customers. It will help the company evaluate its customers, which in turn will aid Canyon Ranch in developing features, products or services that will suit clients’ preferences. The
Carnival has a strong market expansion strategy for selling the mass-market cruise category and first-time cruisers. Furthermore, Carnival Cruise Lines are successful because they have a clear vision and a commitment to their brand essence,