1.0 Royal Caribbean Cruise Line
Royal Caribbean Cruise Line (RCCL) is the world’s second-largest cruise company (behind top-ranking Carnival), with over 20 cruise ships and a total of 60,590 passenger berths as of August 2005. Founded in 1969, the company has been active in changing the cruise industry from a ocean carrier service into a vacation option in and of itself. RCCL offers a variety of different itineraries and its ships travel to many destinations like the Caribbean, Bahamas, Mexico, Pacific Northwest, Alaska, Asia, Australia, Bermuda, South America, Transatlantic, Europe, Bermuda, Panama Canal, Hawaii, New England, and Canada.
The company operates under two separate brands, RCCL International and Celebrity Cruises. A large percentage of its passengers are from North America even though the company operates internationally to their port destinations, itineraries, activities and amenities designed to appeal to every taste, energy level and age group giving our guests the opportunity to create their own adventure. The RCCL vision: “Our vision is to empower and enable our employees to deliver the best vacation experience to our Guests, thereby generating superior returns to our Stakeholders and enhancing the wellbeing of our Communities.” (“Royal Caribbean International,” n.d.)
1.1 Market Definition and Analysis
Successful sales strategy hinges on your ability to identify buyers’ needs and wants. Needs are defined as objective requirements. The buyers’ wants relate more to a value statement. A want exists when a consumer has an unfulfilled need and determines that a particular good or service will satisfy it. (Lamb, Hair & McDaniel, 2006) When a consumer plans a vacation they are attempting to get away from their everyday life and enjoy themselves. RCCL has identified its buyer’s needs by offering a luxury product with all inclusive services in that effort to get away. Buyers have the ability to force competitors to lower prices. Many vacationers will choose the package that is less expensive, causing others to lower their prices as well. This can affect the profits for the company.
Prices start at $12
Prices start at $11
Prices start at $12
For a lot of people the television show “The Love Boat”, which was filmed on a real cruise ship, symbolized the first taste into the world of cruise line travel. If you haven’t vacationed on a cruise and you want to know what all the fuss is about, picture this: You arrive at the ship, where you are shown to your stateroom. Your bags are delivered to your door and you unpack; only one time for the entire vacation.
Then you stroll down to the dining room, where you have to pay for nothing and sign no tab because all meals are included in your cruise. After dinner, you go dancing at a club or sit down for a night of laughs at the comedy club, all free of charge. You walk out on the deck to see the beautiful scenery that takes your breath away. It’s about fresh air, breathtaking views, exploring new cultures and wonderful new discoveries. That kind of inclusive packaging is very appealing to consumers and resorts around the world have copied their strategy. The cruise line industry offers “one-stop-shopping” for buyers, where the customer pays a set price per person.
This will include all meals and accommodation, all the entertainment, leisure facilities and meeting space on board, and any add-ons one wishes to include in advance. The cruise personnel will take care of all the housekeeping, food and entertainment, and can also arrange extras such as shore excursions, presentations and private parties. Buyer behavior is focused on the needs of individual consumers. It is imperative to understand the importance of consumer needs as it relates to buyer behaviour, marketing is about satisfying needs.
The basic necessities of survival need to be satisfied (physiological needs). Safety needs include security and freedom from pain and discomfort, at the level of safety, man has a place to live that protects him from the elements and predators. Social needs are a sense of belongingness, acceptance and love.
The final two needs are esteem (self-respect and accomplishment) and self-actualization (self-fulfilment and self-expression). (Lamb et al, 2006) Fewer people satisfy the higher-level needs. RCCL appeals to consumers with their “Get out there and satisfy your lust for life on a Royal Caribbean cruise.“ This satisfies self-esteem as it makes passengers feel proud of their commitment to fitness. RCCL has defined its market boundaries and has stood out from the competition by offering luxury vacations at a low rate. RCCL’s business is based on people, therefore by defining the market in both their geographic dimension and their product is to recognize their competitors of the undertakings involved that are capable of limiting their behavior and preventing them from having independently on an effective competitive pressure.
In this rapidly growing industry, the boundaries can be drawn based on the location of other cruise ports, the road system, location of competitors, travel time, air time and barriers. It appears as though RCCL has a firm grasp on exactly how many households are in each demographic segmentation of their market and report that information for each of those households in a given area providing information that is customized to each location.
During 2005, their report reflects that their combined brand cruise lines carried more than 3 million passengers, up 7,000 from 2004. (“Royal Caribbean International,” n.d.) RCCL’s main consumer base is primarily vacationers and visiting tourists, who will enjoy the benefit of their supreme level of quality, affordability, and technological amenities. They also market to corporations and businesses, to provide them with their “business at sea” corporate meetings and incentives package. These customers will be looking for safe, high-quality environments that can foster the type of atmosphere needed for personal relaxation and professional success. (“Royal Caribbean International,” n.d.)
1.2 Market Segmentation
Carnival Cruise Line, Royal Caribbean, Princess Cruises and Norwegian Cruise Lines are by the most well-known in the industry and their actions establish industry direction and the nature of the competition. The cruise markets business is based on people, consumers and businesses. These groups of people have wanted and need that can be satisfied by partaking in a cruise.
The market segmentation for the cruise industry can be broken down. The larger lines tend to have a much broader line of service and market segmentation, while the smaller lines tend to be more specialized by serving niche markets and special itineraries catering to specific market segments. Historically this industry has been highly productive with high-profit margins, below-average competition, progressively increasing sales and concrete financial performances.
RCCL’s largest market segment is North America through the contact and services of travel agencies. (“Royal Caribbean International,” n.d.) Professionals and corporations all over North America is another large segment. They will be attracted to the services because of the same technological advances they already enjoy on at home, but will also be attracted to the adventurous, well-maintained relaxed and comfortable environment.
Tourists represent another segment, they will mainly enjoy the dinner cruises with leisure activities, and high-quality attract this segment. The cruise line industry is largely depended on consumer age and life cycle as a means of separating consumers. Income is also another type of segmentation used in the cruise industry, however, I think that cruise lines are trying to incorporate a measure of spending power into the cruise line’s segmentation structures in an attempt to identify younger cruisers that have the same spending power profile as older, more established cruisers.
The cruise industry is trying to inform consumers that taking a cruise vacation is no longer an expensive, once in a lifetime, unreachable dream that it used to once be. It is now an ultimate alternative to a land-based resort vacation, holiday or just a short break.
1.3 Industry Structure and Competition
Generally it is difficult to define the cruise industry. What classifications make a cruise unlike a yacht, boat tour, or riverboat? Who cruises and how they cruise doesn’t follow expected travel trends. Despite 9/11 and SARS affecting travel as a whole, the cruise industry continues to be fairly successful. The cruise industry is the fastest growing segment of the travel industry – achieving more than 1,800 percent growth since 1970, when an estimated 500,000 people took a cruise. More than 11 million people took a cruise vacation in 2005. (“Cruise Addicts,” n.d.) The strong growth has fueled the ongoing development of the cruise vacation experience.
Ninety per cent of cruise travellers book their cruise through travel agencies, this is notably higher than the percentage of travellers that book for general travel through a travel agent. There is a massive untouched market because 84 per cent of U.S. adults have never been on a cruise vacation. Cruise lines cater to a diverse demographic mix. Cruisers average 50 years of age, with an above-average ($99,000) annual household income. Cruise vacations attract travellers from every state in the nation and from every province in Canada. RCCL’s main competitors are Carnival’s Princess, and the Disney Cruise Lines.
I feel that Disney will soon be the strongest competition in the years to come because of Disney’s deep pockets and popular name. Strengths: Numerous port destinations give RCCL an edge over the competition. RCCL distinguishes themselves from their competitors by building superliners. These very large ships not only hold more people but also house more activities and entertainment.
Weaknesses: Higher fuel prices and airfare could cause problems in the industry. They could cause prices to go up, which will keep some people from taking a cruise. There is also the threat of substitute products. Many vacationers look at land-based vacations instead of cruises. Opportunities: As a growing industry, there are many opportunities of which RCCL can take advantage. For one, the next generations (X and Y) have profiles suited for RCCL travel. Generation X has been noted as being individualistic and free-minded. This corresponds entirely with RCCL’s “Adventure” theme of cruising, a way to personalize your vacation.
Threat: The competition in the cruise industry that faces RCCL poses some serious threats to their business. Carnival may have stronger advertising, which yields higher brand awareness among consumers. they are also lower priced in many cases. There is a threat of substitute products, many vacationers look at land-based vacations instead of cruises. Buyers have the ability to force competitors to lower prices.
Many vacationers will choose the package that is less expensive, causing others to lower their prices as well. This can affect the profits of the company. There is a threat of new entrants. This is evidenced by the entrance of Disney cruise lines. This can draw many family vacationers away from RCCL. Economic problems that face RCCL include a potential downturn in the economy. Along with the economy on a downward spiral, terrorism also poses a threat to RCCL’s business. While currently there are few problems affecting cruise lines, another terrorist attack could cripple the industry. This threat causes people to stay close to home and not plan large vacations.
The last threat of alternative vacation options such as resorts and spas always pose a threat to NCL and cruising in general. At the present time, there are three external factors that are critical to the industry. They include the more disposable incomes of the consumer, the competitions between cruise lines, and the ability of the cruise industry to cater to diverse populations. The future factors that are vital to RCCL are the addition of new and larger ships and the use of travel agencies to increase sales.
1.4 Strategy for Competitive Advantage
RCCL’s is in a very competitive cruise and vacation market, their strategy is to target the higher segment of the “mass” market, promising a high-class quality product for slightly more money than their competitors, such as Carnival and Norwegian. According to the RCCL website: “Our vision is to empower and enable our Employees to deliver the best vacation experience to our Guests, thereby generating superior returns to our Stakeholders and enhancing the wellbeing of our Communities.
We always provide service with a friendly greeting and a smile. We anticipate the needs of our customers. We make all effort to exceed our customers’ expectations. We take ownership of any problem that is brought to our attention. We engage in conduct that enhances our corporate reputation and employee morale. We are committed to act in the highest ethical manner and respect the rights and dignity of others. We are loyal to RCCL and Celebrity Cruises, and strive for continuous improvement in everything we do.”
This strategy results in customer satisfaction, which leads to new and repeats customers. RCCL has set an international standard for cruising and their vision and objective is to create an exceptional expression of superior quality, majestic style, outstanding attentive service to their passengers, spacious accommodations, and extraordinary food all the while focusing on exceeding passenger expectations.
RCCL is a global cruise vacation company that operates RCCL International, Celebrity Cruises and Pullmantur. For cruisers that have never experienced RCCL before, they promote it’s “Dare to be Different” slogan along with “When you cruise with us, you’re not just going on a vacation, you’re embarking on an adventure.” RCCL wants to keep promoting its “luxury adventure” theme while adding new activities and entertainment to their ships. RCCL also strives to meet the demands of every vacationer’s budget and expectations. Since RCCL is ranked second, it also hopes to attract a larger total of the vacationing market, cruise industry and at the same time increase their number of repeat customers.
RCCL all-inclusive cruise is typically last as long as 19 days and as short as two. Another attempted strategy is economies of scale. By adding a cruise line to their company, RCCL is trying to increase the size of their company in hopes to achieve the lowest break-even position in the industry, yet another strategy to gain market control. RCCL is offered at a comparatively medium price, as low as $209 per person.
They have “hot deals” and “limited time offers” to attract consumers to their cruises. RCCL has 20 ships in service and RCCL’s ships appeal to those with an active lifestyle. RCCL’s signature elements onboard include rock-climbing walls, in-line skating track, basketball courts, shipboard ice skating rinks, golfing greens at sea and even a surfing pool. RCCL has a multi-channel distribution system in which they reach their potential passengers and book cruises.
The first of the three channels is the most important one for the cruise industry being travel agents. The second channel is online travel agencies such as Expedia and Travelocity. The third channel is booking directly through RCCL using their website or brochures. RCCL focuses on the importance of the environment.
Major concerns with cruise ships are water pollution (from ship-generated waste and plastic products), which are often illegally dumped into the ocean and air pollution generated by cruise ships is also a major concern. RCCL’s integrity is one of their core values and they are committed to meeting the highest ethical standards in all of their business. Further evidence of Royal Caribbean and Celebrity Cruises’ commitment to environmental stewardship is its development of management systems that meet international standards (environmental and quality standards).
RCCL was the first cruise line to develop and implement an environmental management system that was certified as conforming to the ISO 14001 standard. New ships, exciting new itineraries and an ongoing commitment to providing the best cruise vacation experience available anywhere make an RCCL cruise one of the most exciting vacations on land or sea. Following are just a few ways RCI helps its guests “Get Out There.” To consistently exceed guests expectations in all areas of product, service, and support.
RCCL’s vision is to consistently provide quality cruise vacations that exceed the expectations of the guests. The company wants to keep promoting the “adventure” theme while adding new activities and entertainment. The company also wants to provide cruises to meet the demands of every vacationer’s budget and expectations. RCCL is constantly trying to upgrade their product.
They do this by building new and larger ships. They offer more entertainment and activities on these ships. They are also trying to expand their ports of call to new places around the world. This helps the company meet the vacation expectations of more and more people. Family cruising becomes pure enjoyment for parents and their children on every RCCL ship. At RCCL fun and adventure isn’t just for adults, they have plenty of fun for all ages starting at just 6 months old to participate in special themes each day involving learning activities, music, play games, colour, parties, compete for prizes, arts and crafts, learn new sports, and just plain fun.
RCCL also initiated its Save the Waves” program to preserve the environment by not dumping things overboard. In addition, each ship recycled about 20,000 aluminium cans each week, and the company purchased more than one million pounds of recycled products each year. RCCL Online Internet at Sea RCCL ships provides Internet access to its guests. Each centre provides 24-hour access to e-mail and the Internet, with connections to popular web sites for updates on stocks, sports, and entertainment. RCCL guests can also send virtual postcards in ports-of-call worldwide.
The system currently uses English and Spanish, and plans to add more languages More Caribbean Sailings. RCCL is offering more options than ever in the Caribbean, giving travellers the freedom to choose their perfect vacation. RCCL offers nine departure ports: Miami, San Juan, Ft. Lauderdale, Port Canaveral, Tampa, Galveston, Baltimore, New York and New Orleans. Adventure OceanTM. Family cruising becomes pure enjoyment for parents and their children on every RCCL ship. The Adventure Ocean program for young cruisers is free and has long been recognized as one of the industry’s best. Many activities for children ages three to 17. ShipShape Program.
This program offers some of the most advanced exercise options afloat, plus luxurious body-pampering amenities. Each RCCL ship features special ShipShape areas designed for fitness. Aerobics and health centres each span over 15,000-square-feet of workout, aerobics and spa facilities, in addition to 10,000-square-feet of relaxation. Cruise and Golf Vacations. RCCL is the official cruise line of the PGA Tour offering golf during, before or after each cruise. With the line’s popular “Golf Ahoy!” program, RCCL guests can enjoy golf almost anywhere RCCL ship sails, from the Caribbean to Bermuda, from Mexico to Hawaii, from Australia to Indonesia, 41 courses in all. Dining. RCCL guests can enjoy award-winning cuisine and food service on every ship throughout the line’s international fleet. For Guests with Special Needs.
The industry leader in accessibility, RCCL’s “Accessible Seas” program ensures that every vacationer is as comfortable as possible, both on and off the ship. RCCL’s ships offer special accessible features including spacious corridors to accommodate 180 degree turns for wheelchairs, gradual incline entrances into all public spaces, accessible staterooms with roll-in showers, hydraulic pool lifts, and Braille on menus, cabin doors, and elevators. Awards. RCCL has received the numerous awards, show that stands out from their competitors.
In 2004 RCCL received the Excellence in Environmental Engineering Award from the American Academy of Environmental Engineers, Environmental Life Buoy Award from the Jewel of the Seas, Port of Stockholm, the Green Planet Award — for the ships Brilliance of the Seas, Jewel of the Seas, Majesty of the Seas, Splendour of the Seas from Kuoni Travel and in 2002 and 2003 received the Best Eco-Friendly Cruise Line from Porthole Cruise Magazine. Destinations. RCCL offers over 160 exciting destinations. through its cruise line division.
Credit Card. RCCL has introduced a credit card through which users can earn points toward merchandise, onboard amenities, upgrades, cruise discounts and free cruises. The objective of this loyalty marketing program is to build long-term relationships with its passengers to keep them coming back for more free benefits. Accessible Seas. The industry leader in accessibility, RCCL’s Accessible Seas program ensures that every vacationer is as comfortable as possible, both on and off the ship. All of the company’s Voyager-class and Radiance-class ships offer special accessible features including spacious corridors to accommodate 180 degree turns for wheelchairs, gradual incline entrances into all public spaces, accessible staterooms with roll-in showers, hydraulic pool lifts and much more.
The Scholar Ship. Their marketing pitch sounds very attractive to a student: “Higher learning on the Higher Seas.” During a 16-week semester, students will pursue numerous opportunities through academic field studies, shore excursions and independent travel. The port program is highly integrated into the academic program, making for a sophisticated learning experience. Onboard, students will be completely immersed in a multicultural living environment. The international student body and staff form a learning community that integrates academic, cultural, and social experiences in programs that would be virtually impossible to duplicate elsewhere. Crown & Anchor Society. Once you have been on a cruise you are asked to be a member. Members are entitled to discounts, subscriptions to their magazine, a member’s only cocktail party hosted by the captain and various other benefits and perks. This is a loyalty reward program.
1.5 Market Targeting and Position Strategies
RCCL targets couples, singles, families, honeymooners, experienced cruisers, second honeymooners and groups of friends (or pretty much everyone) to sail away on the vacation of a lifetime. RCCL caters particularly for consumers between the ages of 3 to17. By specifically targeting families with young children, the focus was the wide range of shore excursions, onboard facilities and activities, communicated by the “Way more than a cruise” motto across press, poster, TV and online.
The agency task was to communicate this positioning online and to drive prospects to interact, request information or book. Many of their cruise lines have activity centers, teen centre and kids dining facilities. The supreme level of luxury, quality and technological amenities put RCCL ahead of the competition. This is the main position of marketing and advertising efforts, through travel agencies, brochure distribution and TV advertising, also including Internet advertising and set up of web sites. RCCL informs consumers that service is their greatest priority.
Target segments need the quality, convenience, service, safety, comfort and technological amenities that can only be found at RCCL. This industry is constantly evolving and prospering. One of the most significant aspects of the cruise industry is the requirement to adopt technological advancements as well as maintaining the overall appearance, maintenance and condition of the cruise ships. Another important feature is to present services that other cruise lines don’t, or rarely offer, for example providing Jet-skis, water skiing, visiting small islands and such.
I think RCCL’s current corporate structure is based on a profit centre concept. The goal of the company is to make a profit, but at the same time deliver exceptional service to passengers. RCCL’s executives and employees all share the same goal; they want to provide customers with the highest level of service. It seems that RCCL has a strong cultural strength: the employees accept the “culture” of the ships. RCCL takes the values of different nations and groups into consideration. It does this by providing different types of ships to different areas of the world and for different groups of people. With their current marketing mix they are broadening their attraction from seasoned elderly cruisers to a younger audience that is familiar with an adventurous and more relaxed “resort-style” vacation. They are aiming to accomplish this through their Adventure cruising concept and create a more consistent luxurious image for the company.
RCCL could use their superior service, reputation, and diversification to take competitor’s customers away because they have the total package. RCCL would obtain a larger market share of the vacation industry. However, competitors might reduce costs and that could cause RCCL to have to reduce prices also. This would cause a lower profit margin for them. To concentrate on growth RCCL could expand into the aeroplane, hotel, or theme park industry. This would assist them in penetrating new markets and could increase their profits.
This would also increase RCCL’s share of the present market. However, this would require significant finances to get it going. By specifically targeting families with young children, the focus was the wide range of shore excursions, onboard facilities and activities, communicated by the ‘Way more than a cruise’ slogan across press, poster, TV and online. The task was to communicate this positioning online and to drive prospects to interact, request information or book and I think it has worked. During the activity period, the site traffic more than doubled, with significant increases in brochure downloads and brochure requests. The e-newsletter mailing base increased by over 30% over a three month period and the newly launch direct sales ‘call back’ function exceeded the bookings target.
2.0 Objectives As I See It
RCCL’s goal is to promote its brand by creating an attractive appealing website that will make the consumer want stay. RCCL has detailed information on every cruise line destination and cruise ship sailing the seven seas. Their objective is to bring in more business and, ultimately, increase revenue. This is achieved by displaying a user-friendly web “existence” and lure potential customers and even future employees. Advertising, giving the consumer a better perspective of the companies goals, believes, and products. And ultimately keep up today to stay competitive.
Without some sort of navigation, a website loses the entire sense of structure and organization. RCCL has done a great job making it easy for the consumer to explore through their website. RCCL has their company logo in the top left corner of the screen at all times, creating an escape route if someone gets away from what they were initially searching for.
The top navigation bar gives immediate knowledge, information and details of the website, illustrating what RCCL has to offer, as well as making it easy to click on different subjects. RCCL has its website grouped into subjects, also helpful in navigating around the website. They have incorporated a site map located at the bottom of the page, a way to prevent consumers from feeling lost.
4.0 Graphical Design
An appealing website is what will attract a consumer’s attention. High-quality functions are part of the website which drives consumer interest and interaction including digital brochures, e-newsletter subscription, and sales contact. The clean, crisp graphics add life and interest to the website, making you want to continue surfing.
5.0 Ease of Finding Product Information
I found it very easy to navigate around the website to gather information about the company, the ships, the rooms, the amenities, prices, the entertainment and activities. The topic of each specific page is clearly displayed with a page title, paragraph headings and text relate to that topic.
6.0 Ease of Finding Support Information
I found it very easy to find support information. A customer support tab is located at the top bar of the website, with a drop-down menu of more specifics, from frequently asked questions to a list of phone numbers to call to speak with a representative to locate a travel agent in your area.
7.0 Ease of Ordering
I have not ordered from the Royal Caribbean website, however, when I attempted to build a cruise it was only a matter of five or six clicks to book a cruise, with several customized options that you can choose from.
8.0 Features that Really Stand Out
The website asked very detailed information that I wouldn’t have thought of prior to planning a cruise. For instance, during the ordering process it asks if you want to see prices that include airfare, if you want to add on a hotel package before or after the cruise or add ground transportation to and from the port.
9.0 Best Aspects of Site
The speed and the ease of planning the vacation of a lifetime at the click of a button.
10.0 Biggest Improvement Opportunities
The best aspect for me was the speed of the pages loading. Consumers will not stick around to wait for pages to load; they will just exit the site and look for another website, possibly a competitor.
11.0 Site Suggestions for Change
I didn’t really notice anything that was negative on the website.
12.0 Overall Impression, Improvements, Suggestions
After browsing RCCL’s website I was impressed with the layout, ease, appeal and attractiveness of their website. It was fast and informative and I could search by typing in a word and it listed several options to choose from.
All about cruising. (n.d.) Royal Caribbean International. Retrieved December 10, 2006, from http://www.royalcaribbean.com/allaboutcruising/higherLearning.do;jsessionid=0000YVja6AgcWWaY6rRNzgl4KEF:10ktmer4a?cS=NAVBAR
Customer case study: royal Caribbean cruises. (n.d.) Authoria. Retrieved on November 27, 2006, from http://www.authoria.com/casestudies/case_study_rccl.pdf
Investor relations. (2005) Royal Caribbean International. Retrieved December 17, 2006, from http://www.rclinvestor.com/phoenix.zhtml?c=103045&p=irol-fundsnapshot
Lamb, C., Hair, J. & McDaniel, C. (2006). Essentials of Marketing. Dubuque, IA. Thomson South-Western.
Press release. (n.d.) .Royal Caribbean International. Retrieved November 20, 2006, from //www.royalcaribbean.com/ourCompany/pressCenter/pressReleases/info.do;jsessionid=0000dvLneqvnEO_dqYbQtUDb-JL:10ktmer4a?prDate=02-02-2006&prCode=A
Pressroom and research. (2007) Cruise Line International Association. Retrieved on December 5, 2006, from http://cruising.org/press/sourcebook2006/profile_cruise_industry.cfm
Our vision. (n.d.). Royal Caribbean International. Retrieved December 13, 2006, from http://www.royalcaribbean.com/ourCompany/ourVision.do
Royal caribbean cruise lines. Redmon Group Inc. Retrieved November 20, 2006, from http://www.redmon.com/portfolio/cruisematch2k.cfm
Prices start at $12
Prices start at $11
Prices start at $12
Royal caribbean cruises ltd. finalizes pullmantur purchase. (2006, November 14).Cruise Addicts. Retrieved December 7, 2006, from http://www.cruise-addicts.com/Cruise-News/Royal-Caribbean/royal-caribbean-purchases-pullmantur.html
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