...Key Points The birth of the modern cruise industry can be dated back to the 1960s. With the Airline industry taking off, shipping companies began to reposition themselves as providers of transportation to that of vacation travel. As the means of travel changed, so did its consumer base. Cruising was dominated by brands that served a more affluent customer base, providing fine dining, formal atmospheres and a high degree of personal service. However this also rapidly transformed the market and brands like Carnival Cruise lines emerged. Carnival cruises is the market leader in the low-price cruise market. They strategically achieved this position by emphasizing on-board activities, and targeting a relatively younger cruiser. However, after acquiring 24 percent of the berth space in North America, it has plateaued in being able to set itself apart from its competitors. The case in question outlines key attributes that assist in determining if it wise that the brand make a lateral shift from their current low-priced market to that of a premium one. This analysis will be assessed by means of a brand strategy, possible marketing initiatives and various concepts discussed in-class. The case goes on to highlight that although Carnival Cruises is a key player in the entry level cruise business, it has room for significant improvement. As more competitors emerge, a “sea of sameness” begins to overtake the minds of potential cruisers. The author investigates the foundations of Carnival’s...
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...Carnival Cruise Line Case Study Abstract This case study reviews the financial position of Carnival Cruise Line. The data reviewed is primarily from the previous five years of annual reports produced by the company (2007-2011) and certain key ratios derived from those reports. For comparison purposes, this case study will use Carnival Cruise Lines nearest rival, Royal Caribbean Cruise Line. This case study will prove the financial strength and stability of this company and give the reader some indication as to why Carnival Cruise Line is the industry leader in the cruise market. Carnival Cruise Line Case Study The company that would eventually become Carnival Cruise Line (Carnival) began in 1972. It started with just one second-hand ship and enough fuel to make a one-way trip from Miami to San Juan, Puerto Rico (Carnival Web Site). Today, Carnival is the largest cruise company in the world – consisting of ten cruise brands operating 99 ships worldwide. For the fiscal year ended November 30, 2011, Carnival served over 9.5 million passengers and generated approximately $16 billion in revenues. Based on 2011 numbers, Carnival controls 49.2% of the market while its nearest competitor – Royal Caribbean – controls 23.8%. Various smaller competitors comprise the remaining market share of 27% (Cruise Market Watch, 2012). Carnival has managed to maintain its profitability and market share in an environment of economical and geopolitical swings. The structure of this...
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...Individual Report Case 16: Carnival Corporation & plc (2010) Carnival Corporation consists of 10 semi-autonomous cruise lines, each with its own set of concerns, strategic view, and market characteristics. In order to need to see these separate units as a whole, and make decisions based on total shareholder return and conceptualize Carnival’s diverse businesses, we employ a Growth-Share Matrix analysis. Carnival Cruise Lines was the most popular cruise line in the world leading to be a “cash cow’’ that could gain hugely profitable for Carnival in the long term. The following are Princess Cruises, Holland America Line, Costa Cruises, P&O Cruises, Cunard Line, and Ocean village that had transferred to P&O Cruises Australia, an area Carnival had forecast as having better growth potential. Carnival also had two star businesses; AIDA and Seabourn. These are potentially crucial brands to Carnival, and should be given the capital needed to grow aggressively. In the cruise business, this means adding capacity, and AIDA which was number one brand on German cruise market is getting that: 4 of the next 10 Carnival ships will be AIDA. Next was Seabourn which its cruise, The Sojourn was awarded "Best Newcomer of the Year- Silver" from the European Cruiser Association in 2010. It also was voted as "Best Small-Ship Cruise Line in the Conde Nast Traveler Readers' Choice Poll in 2008 and 2010. The line was also voted the "World's Best Small-Ship Cruise Line" in the Travel...
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...CARNIVAL CORPORATION STRATEGY REPORT GRIFFIN CONSULTING GROUP Benjamin Levin Jennifer Jones Tom Slade Wednesday, April 11, 2012 2 CONTENTS Executive Summary ..................................................................................................................... 4 Company Background ................................................................................................................ 5 History ....................................................................................................................................... 5 Costa Concordia Incident .......................................................................................................... 6 Business Model and Operations Summary .......................................................................... 8 Five Forces Framework ............................................................................................................. 11 Internal Rivalry ...................................................................................................................... 11 Supplier Power ....................................................................................................................... 13 Buyer Power............................................................................................................................ 14 Entry and Exit ....................................................................................................................
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...Jessie Carpenter Professor Merrie Marks MGMT500.2 Principles of Management 21 September 2013 Case Analysis: Micky Arison and the Costa Concordia Tragedy The former CEO of Carnival Corp. faced one of his biggest challenges when the Costa Concordia cruise ship began to sink off the Italian coast in January 2012. His actions at the time caused a bit of hype in the public eye. People wondered why Micky Arison wasn’t taking a more public role during the incident. From across the seas Mr. Arison expressed his condolences to victims via Twitter and in company news releases. He also gave his personal assurance that Carnival would take care of the passengers, crew and the victims and announced a comprehensive safety audit (Kinicky, Williams 92). Mr. Arison is known to be a big delegator. His management style is relatively less involved with the operating decisions of the multiple cruise lines named under Carnival Corporation. When the cruise ship crisis was reported he chose to stay in Miami and leave the immediate response decisions to the executives of that division as to avoid becoming a distraction in Italy (“Arison on Costa”). While another of the cruise ships under his domain was stranded at sea with diminishing resources Arison was publicly seen attending a Miami basketball game (Young). He was criticized for that seemingly negligent behavior as well. After stepping down from his position as CEO a year later, he went on to say that he would be taking an even less hands-on...
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...Royal Caribbean Case This main focus of this case study is an analysis on the current situation (data from around 2Q of 2010). The case compares Royal Caribbean to its main competitor, Carnival, through the entirety of the study. The most discussed issue in the case is of Royal Caribbean and its situation relative to the world economy as its recovering from one of the worst recessions since the great depression. From where the timeline of the case begins (2Q of 2010) it had made a large recovery in profit and had cut costs as well. However, even despite the forecasts predicting a further increase in profit, Royal Caribbean along with the cruise line industry is still in a delicate position. The case constantly brings up the point that cruises are solely a purchase based off of discretionary income. In times of economic struggle, discretionary items like cruises are left out of the budget. Another issue that the case brought up with every factor discussed is Royal Caribbean being 2nd place in the world for market share, bested by Carnival Cruise Lines. The case goes back and forth debating whether or not its position within the market share is a good thing. While they by far are in 2nd place, Royal Caribbean has a special niche in the market being the luxury cruise liner with the newer and nicer ships. Overall, the largest theme in this case study is the uncertainty of the cruise industry with the unpredictable economy that may or may not be recovering. Strategic & Financial...
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...Centralized Planning in Cruise Industry Abstract This paper identifies the conventional supply chain planning system MRP (materials resource planning) and the complexity of global cruise supply chain management and suggests a contemporary centralized ERP (enterprise resource planning) to solve supply chain issues. Introduction and background The ever-expanding cruise ship industry seems to have no end to its own growth. In the 1980s the growth beat every expectation and since then, the sustained growth has repeatedly given the cruise sector the title of the fastest growing segment in the tourism industry with an 8.4% average annual growth from 1980 to 2003 and a projected similar pattern for the coming years. Another sign of booming business is the fact that every cruise company is ordering 1–2 ships per year to increase their capacity. With these increasing size and capacity expansions, the problem of supply chain and logistics management is also compounded. The ships benefit from very tiny time windows to re-supply and these are not increasing proportionally with size. Therefore, these bigger ships will create new challenges on an operational level. To worsen the problem, cruise ships are committed to the supplies present onboard once leaving the port. Therefore, demand forecasting must be very precise if the safety stock is to be reduced in this space-starved environment, while preventing costly stock outs. Overall planning of supply chain Cruise industry consists of...
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...Alicia Trezza Zak Jones Carnival Cruise Lines 1. Conduct a SWOT analysis for Carnival: what are its strengths, weaknesses, opportunities and threats? In doing so, please evaluate its major competitors. Strengths - Carnival has 75 ships in its fleet and is continuing to brand the company as the “fun ships” - There are large barriers of entry into the cruise businesses. Ships are extremely costly and time consuming to build. - Carnival cruises provide a vacation that includes all activities, food, beverages and transportation to multiple destinations in one low price, appealing the budget friendly cruisers. - Carnival builds it ships specifically for entertainment and fun, the most important factors people are looking for when booking a vacation. - Carnival markets to all travel agents. With a variety of cruise ship offerings, Carnival has vacations that appeal to a variety of demographics, budgets and niches. - Carnival has ample opportunity during each cruise for ancillary revenues. Even through the cruises are “all-inclusive”, Carnival charges for short off boat excursions, casino play, and alcohol. - Ships almost always sailed full and satisfaction rates were extremely high. Weaknesses - Past issues, such as one ship hitting a sandbar on the first voyage leave lingering impressions on vacationers. - Customer loyalty is low. It appears customers are only willing to take 1-2 cruise vacations in a few year spans, despite Carnival’s high satisfaction ratings. -...
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...Justification Report Name Course Tutor Date Justification report Assignment 2.1- Justification Report(Part 1) Problem statement The main problem that employees face in Carnival Cruise Line Company is a hostile environment. This hostile environment in Carnival Cruise Line Company is also a form of harassment. A good number of other employees in Carnival Cruise Line Company normally think that issues that bring about the hostile environment in the workplace include; bosses who are irresponsible, rude coworkers, privileges, benefits, the lack of perks, work environment that is unpleasant and even recognition. In most cases, to consider the workplace hostile, some lawful standards and policies are supposed to be met. The creation of this hostility in the work environment is mostly done by the boss or a colleague whose behavior, actions, and communications makes it impossible to perform the responsibilities of the workplace or the organization. With the traits portrayed by the coworkers and the employers, it can be concluded that he traits are responsible for changing the terms and conditions or the anticipations of the conducive and comfortable work environment for all employees. Moreover, in order for a work environment to be considered hostile, the traits and actions should show unfairness. An example is where an employee posts nude images or says sexual and explicit jokes is termed as guilty of harassing a fellow employee sexually (Mann & Goodman 2008)....
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...Carnival Cruise Lines: Exploiting a Sea of Global Opportunity International business 13th ed. Summary: This case describes the history of the cruise industry and defines it, then it talks about the current state of the Cruise industry, then it goes on to discusses the business in international waters, after that it states the main points in Carnival Cruise Line operations, finally it argues the overseas environment. SWOT Analysis: Strengths: 1. Carnival cruise lines is one of three major companies that has the share of 91% of the market and it is the largest of all three. 2. That being said it is very strong financially. 3. The financial strengths of carnival cruise line generates international connections that will be very helpful in this line of business. 4. Another point resulting from the financial strengths is the ability to cover their customers geographically being based in different countries. 5. The ability to target different segments hence it has different cruises with different costs. Threats: 1. The health problem that faced them in 2006 where a virus hit the cruise caused bad publicity which causes carnival to take the infected ship out of service which caused financial losses. 2. Any health epidemics causes carnival to avoid ports of the country infected which also can cause financial losses. 3. The weather causes a major threat which normally forces the company to cancel the trip...
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...Carnival Cruise Crisis Management Carnival Corporation operates as a cruise and vacation company worldwide. Its stock is listed on the New York Stock Exchange. Carnival has a portfolio of the world most widely recognized cruise brands. One of these brands is Carnival Cruise Lines, which is the most popular cruise brand in North America and operates 24 ships designed to foster exceptionally fun and memorable vacation experiences at an outstanding value. In this paper, I focus on a crisis of Carnival Cruise Lines, which happened in 2013, and I will also give an analysis about how Carnival handled the crisis. In addition, I will give my own suggestions to this crisis management. Introduction of the crisis On February 7, 2013, the Triumph, one of Carnival’s ships, left Galveston, Texas, with 3143 passengers and 1086 crew aboard for a cruise, which was supposed to last 4 days. However, on February10, a fire broke out in an engine room on the Carnival Triumph, which was sailing in the Gulf of Mexico. The blaze was extinguished quickly and no one was injured, but propulsion systems were knocked out. Although the ship had two engine rooms, shared cabling between the two was damaged by fire, leaving only emergency backup power available. Triumph floated helplessly until the ship was towed back to Mobile, Alabama on February 15, which means Passengers had spent five uncomfortable days on the Triumph. The last five days for the people on Triumph were suffering because of limited water...
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...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 infrastructure, are they ready/capable to introduce enterprise systems (CRM in this case). 3) How did Carnival’s management build the line into the dominant brand in the industry? Consider how this approach/strategy relates to CRM? 4) Describe what CRM means to Carnival’s different levels/ages of management (e.g., Dickerson and old guard vs. Newer Management)? Why the different perspectives? 5) Based on your assessment, should Carnival do “CRM”? What should CRM look like at Carnival? Explain your position. 6) How would you go about implementing your strategy at Carnival? What would it take to deliver on your recommendations? Carnival Cruise Lines Case 1. How did CCL’s management build the line into the dominant brand in the...
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...April 13, 2014 Carnival Cruise Lines 3655 NW 87th Avenue Miami, FL 33178 Dear Carnival Cruise Lines Guest I realize that many of you experienced a hardship upon one of our vessels The Carnival Splendor and I would like to take this opportunity to express our deep regret for the discomfort you encountered. I would also like to take this opportunity to thank many of you who have written me personally to express your support. Our number one concern was to ensure the safety and welfare of our guests and crew and to get them home as soon as possible. Our staff worked tirelessly to take care of you and minimize your discomfort and inconvenience. We also focused on making sure your loved ones stayed up-to-date on the situation through the use of Twitter, Facebook, and our Funville blog. The safety and security of our guests remains of the utmost importance to all of us here at Carnival. I understand many people do not believe our vessels to be safe. This is just not the case. All Carnival officers and crew undergo comprehensive regular safety and emergency training that meets or exceeds all regulatory requirements. Also, Carnival ships undergo an inspection as mandated by the U.S. Coast Guard every 3-6 months which verifies safety processes and procedures. In addition, a third-party organization conducts annual inspections of the ship and our safety processes. As you can see our safety processes are first-rate and a priority for all crew and guests. I believe you...
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...Carnival Cruise Lines The company founded in 1970s is a market leader in the cruise vacationing category. It comes under Carnival Corporation which has a portfolio of 12 cruise lines and 75 ships. The operations are mainly in North America (where they sailed from 19 home-port cities). The company has its headquarters in Miami and is perceived as “Fun Ships” by the customers. Carnival Corporation has a market share of 51.6 % (North American Cruise Capacity). Carnival Corporation is currently having the best year in its history. Carnival Cruise Lines currently has a fleet of 20 ships and would be adding the 21st ship to the fleet in the next year. They are the leaders in the low-price segment. Cruise Industry Background * Cruise vacationing was the fastest-growing category of the North American leisure-travel industry * Only 16% of the North Americans have ever cruised (huge potential) * 70 Brands serve the North American market since the 1960s but the Top 10 Brands control 95% of the Market share * North America accounts for 74% of cruise passenger capacity while Europe accounts for 23% * Cruise Lines targeting the North America market operates in four segments – contemporary (mass-market), premium, destination (speciality) and luxury. The luxury and destination segments accounts for only about 5% of the market Case The company is looking ahead to opportunities and challenges * There is a branding initiative designed to narrow the gap between Carnival’s...
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...MGMT 619 Spring 2009 Carnival Corporation [pic] Team 6 Amy Clogher Jacob Griego Ted Noble David Sciortino Deepa Sethi Executive Summary Carnival Corporation is the leading cruise line company in the international cruising industry, with 11 major cruise line brands and is clearly a winning company. It controls almost 50% of the cruise line market and is a broad line provider. The company does not face any considerable challenges within its industry and has adequately responded to all threats. Although 2008 was a challenging year due to the economic crisis, Carnival posted net income for 2008 of $2.3 billion (15.9% of sales). Carnival’s strategy is to be a broad line provider with a wide scope on a large scale. Carnival maintains this strategy by focusing on cost leadership in the contemporary and bargain lines, and then differentiating in the premium and luxury lines of their product mix. Industry & Competition The cruise line industry is a moderately attractive, 3-star industry that is characterized by top incumbents capturing a majority of the economic value in the industry, high fixed costs, cost savings achieved from economies of scale, and a high degree of rivalry between the top two industry incumbents. The cruise line industry has reached the growth stage after the inflection point. It is predicted that the growth stage will be longer in the cruise line industry due to frequent product upgrades and niche enhancements that forestall...
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