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Carnival Cruise Lines

Q&A
Submitted To:Prof. Tripurasundari
Joshi

Submitted By:- Group


4
Ayushi Godha
(141113)
Jayant Kushwaha
(141119)
Nikhat Raj
(141130)

Q1. What was the customer profile


for the industry vs for Carnival
Cruise Lines
Ans.

Industry Profile
1.
2.
3.
4.
5.

Average age: 50
years
Household income:
$99000/year
78% were married
and sailed with
spouses
54% had taken first
cruise within past 5
years
1/3 of customers
were first timers

Carnival Customer profile


1.

2.
3.

4.

Avg age: 46 years


(24% guests 55 or
older, 40% between
35 and 55, 36% 35 or
younger)
Income: $65,000
Customers
constituted of
families, singles,
honeymooners,
multigenerational
families. Only 55%
customers were
married.
50% of guests were
first timers

Other distinctions:
Carnival was a no frills party cruise line that
attracted all kinds of customers as opposed to the
industry customers which attracted an older
customer base
Carnivals majority of customers had cruised with
the brand twice, repurchasing every 12 to 25
months.

Q2. What were the pros and cons of the


distribution channel?
Ans. Carnival Cruise lines had2 types of distribution channels
1.
2.

Travel agents- which accounted for 85% of the companys


bookings.
Direct Booking through website

Travel agents included large internet agents such as Travelocity and


Expedia to mom and pop stores and at home agents. They earned a
10% commission. Dependence on agents was very high as they were
sitting on a lot of information on customers.
Pros:
1. Agents maintain good relationship with customers
2. Many customers prefer direct contact while booking tickets rather
than relying on ads or a website
3. Agents have more information on customers
4. 85% bookings are made through agents

Cons:
5. Agents wield a lot of power as Carnival is highly dependent on
them
6. they do not pass complete information on customers to the cruise
line
7. They do not focus on customer requirement by marketing Carnival

Carnival website comprised of inbound and outbound avenues such as 1800-Carnival and Carnival.com.
Pros:
1. Customer feedback can be obtained directly
2. Customers can give activity information through Carnival website
3. Certain people prefer to book online and can get as much information
as they need
4. No agent charge is applied through website
5. More information can be gathered through website such as new/first
time customer
6. It involved interaction initiated by customers and a more qualified lead
Cons:
7. Carnival doesnt spend more on IT and travel industry so it affects the
customers
8. its a complicated process to book through online website
9. Many customer prefer face to face interaction when they are planning
a big vacation

Q3. What was the management


philosophy of Carnival in terms of
running the business?
Ans. Carnivals management has always used forward looking
approach for the management of Carnivals ships because the
customers profiles, interests, likes and dislikes keep on changing.
Therefore, Carnivals management has kept their product consistent
with the changing preferences of its changing customer base.
Moreover, Cruises management took care of procurement of new
ships. Its negotiation skills and long established relations with the
ship builders have enabled them to buy new ships cheaper than its
cost to its competitors because usually competitors pay 25% to 30%
more for a new ship.
Furthermore, Carnival has maintained various facilities on the ship
that attracted customers. It was committed not only to meet the
customers expectations but to exceed them.
This approach led Carnival to provide quality services and products
during the vacation period and attracted more customers.

Q4. What are the problems faced


by carnival?
Carnival Cruise Lines is mainly having two issues
related to Database Management & CRM
Implementation.
Data Management: Carnival has a large database
of past-cruisers which they have not used yet,
along with other information which they should
have but agents have not shared with them.
CRM Implementation: Along with the database
problem, there is also a problem concerned with
the fact that carnivals primary market up until
now has been the mass-market cruise category of
first time cruisers and 98% customers are
satisfied. Still only 20% customers are repeat
customers. This calls for CRM implementation as

Q5. How can carnival use CRM?


Carnival can use CRM in the long term to invest in
customer loyalty programs and target their top
customers with tiered service offerings. These are real
products that affect the margins of the company. So the
CRM could be usedto enhance the customer's
experience by doing the following:
(1) Based on age and marital status of customers,
special suitable activities can be offered, like excursions
and spaservices which are profitable; also a discount
could be included to attract more such customers.
(2) Customer feedback can beuseful to make the
necessary adjustments to the overall package.
Some of the existing technology like Sail and Sign can
also be tied together with CRM to be even more
successful and strategic.

Q6. Identify systems that can be used by


carnival for CRM and also those which cannot.
In order to effectively implement CRM, it is imperative that there are
certain systems in place like information technology infrastructure.
This means that the databases have to be strong and the information
has to be reliable. This is the first step of the process for CRM
implementation. According to the case, CCL already has the
databases for use, including Oracle databases called Property
Management Systems (PMS) and Point of Sale (POS). The problem
right now with their infrastructure is issues they have with data
integrity and availability. The second step of implementing the new
CRM strategy is to change the database design in a way that can
improve customer and transactional data so the company can use
the information. Having this data funnel into one data store can help
the company get the most out of the relationships they build with the
various intermediaries they will have online as well as through their
website.
Security and privacy risk seems to be a major issue for this company
as information integrity and availability are not at acceptable levels.
The information systems created will likely contain very sensitive
information such as credit card numbers. In accordance with the