Carnival Cruise INTRODUCTION In 1972 American Travel Services, Inc., along with Ted Arison, bought two ships from the Canadian Pacific Empress Lines for $6.5 million. These two ships were named the Marti Gras and the Carnivale. Things did not begin well for this group of investors. On its first voyage, the Marti Gras ran aground in Miami Harbor. The ship was also slow and used up very expensive fuel.
For the next three years, Carnival lost money. During this time, Arison tried to drum up business by adding such attractions as casinos, discos, nightclubs, and various forms of activities. Finally, in 1974, American Travel Services was ready to pull out of the joint venture. So, Ted Arison bought out ATSI for $1 cash. Unfortunately, he also acquired the $5 million debt that went along with the venture.
As luck would have it, however, the following month after the buyout by Arison, the repaired Marti Gras began showing a profit. For the remainder of the year, it operated at or above than 100-percent capacity. Following this successful year, Mr. Arison along with his son, Micky Arison and Vice President of Sales Bob Dickinson, began to change the Carnival marketing strategy. They devised a scheme that went after the first time and young cruisers with a moderately priced vacation package. This vacation included the cruise and airfare to and from the port of departure. Carnivalfs rates were competitive with such vacation packages as that of Walt Disney World. Also included in the fare was entertainment, meals, and activities.
During the 1980s, Carnival was able to maintain a growth rate of 30 percent. This figure was three times that of the industry. In 1987, Carnival conducted a customer profile. During its study, they found that the average person cruising with Carnival was between the ages of 25 and 39 and had a household income of $25,000 to $50,000. In 1988, 1989, and 1990 Carnival experienced vast expansion and change. They acquired 4 cruise ships from the Holland American Line. These ships were used to target the higher income vacationer. They also began construction of the $250 million Crystal Palace Resort and Casino located in the Bahamas.
Ted Arison in 1990 relinquished his role as chairman of the board to his son Micky who remains in that position today. THE CRUISING INDUSTRY With the vast explosion of the airline industry in the 1960s, the ocean liner was quickly becoming obsolete. Cruising, which was the exclusive privilege of the rich and famous, was now being targeted toward the middle class. These luxuries and amenities were now offered to the middle class. According to Robert Meyers, editor and publisher of Cruise Travel magazine, the increasing popularity of taking a cruise as a vacation can be traced to two events. First, televisionfs Love Boat and the increased participation in the workforce by women gave families more disposable income. CARNIVAL TODAY Carnival is a thriving industry today.
It owns four other Cruise lines including Holland America Line and Windstar Cruises. The parent company, Carnival Corporation owns Costa Cruise Lines, Seabourn Cruise Line, Airtours, and Weston hotels and resorts. Carnival has just introduced two new SuperLiners this year. The first ship is the MS Elation. This ship can hold 2,040 passengers and is the first ship to sail year round from Los Angels.
The MS Elation was built with all the features of the most popular ship, the Carnival Destiny. The second ship is the MS Paradise. The most surprising feature of this ship is the fact that it is entirely smoke free, which makes it the worldfs first cruise ship with this distinction. The Paradise will have seven-day cruises that run year round from Miami. There are five new cruise ships that are under construction now. The Carnival Triumph, the Carnival Victory, and three more which have yet to be named.
The MS Carnival Triumph and MS Carnival Victory are both supposed to be larger than the Carnival Destiny. Triumph will be released in late 1999, and Victory will be released in the summer of 2000. The other three will be in the water sometime after 2000. Carnival is having no problem dealing with consumer demand for their cruises. Carnival has twelve operating ships in its fleet.
They have nearly one hundred percent occupancy for all of their cruises. Carnival is currently operating cruises ranging from three to sixteen days in length to the Bahamas, Caribbean, Mexican Riviera, Alaska, Hawaii, and the Panama Canal. Carnival has implemented some programs that have met with incredible success. This year Carnival implemented the cruise industryfs only vacation guarantee. People who might be hesitant to be on a cruise might try it with this offer. If someone is unsatisfied with the cruise they will be dropped off at any port of call, flown back to their home free of cost, and have the unused potion of their cruise refunded. For those that are health conscious, brand new Nautica Spas are aboard all of Carnivalfs ships.
The dining roomfs relaxed environment, with non-formal dress wear is the biggest success on the Carnival ships. Carnival does place an emphasis keeping the customer happy. MANAGEMENT & PHILOSOPHY Carnival Cruise Lines has set out to accomplish nothing less than a totally new concept of cruising. There is absolute dedication to the highest level of personal service. This service is not only the finest afloat but equals to that found in celebrated hotels, resorts, and restaurants anywhere ashore. Carnival ships are spacious and comfortable. They allow guests to establish their own pace as befits their lifestyle.
With its service and performance, Carnival has proven itself to be one of the top Cruise lines in the world. One proposed definition of value is quality at the right price. Carnival believes in this definition. When the consumer is satisfied with the product that they have purchased then the consumer feels they have received value. Carnival tries to make it a moderately priced cruise, worth every penny. Carnivalfs approach to market competition is if they can offer superior quality at comparable prices, then the consumer will recognize the value.
Guests will find that Carnivalfs philosophy may be summed up by the phrase Fun Ship. Carnival recognizes that its customer is independent, intelligent, and wants to have a cruise that they will completely enjoy. The vacation plan is to offer them numerous choices with what they want to do with their time, and let them absorb the atmosphere. Carnival believes in nurturing customer loyalty and providing rewards for past passengers. MISSION STATEMENT Carnival Cruise Lines is the largest, most popular, and most profitable cruise line in the world.
The leader in the contemporary cruise market, Carnival operates 11 eFun Shipsf, including the worldfs largest, Carnival Destiny. Carnival ships sail to the Bahamas, the Caribbean, Mexico, the Panama Canal, Alaska, and Hawaii. The companyfs customer base is divided up into three different target audiences. They are: the contemporary segment which is served by the seven days or shorter cruise and features a casual ambience, the premium segment which is served by the seven-day-and longer market, and the luxury segment which caters to the experienced cruiser for seven-day-and-longer sailing. Carnival has the unique ability to provide customers with a wide range of vacation choices that appeal to any taste, interest, lifestyle, or budget. With a mission to surpass customer expectations, Carnival offers leisure travelers vacation experiences equal or superior to those at the worldfs most popular travel destinations.
Carnival wants to remain the leader and innovator in the cruise industry and intends to do this with sophisticated promotional efforts and to gain loyalty from former cruisers by refurbishing ships, varying activities and ports of call, and being innovative in all aspects of ship operations. CARNIVAL CRUISE LINES INTERNAL MATRIX INTERNAL MATRIX STRENGTHS 1. Carniv …