Download - Carnival cruise lines
Carnival Cruise Lines
Syndicate 5 : Ria Agustriana 29111321 Agung Mahendra 29111324 Rangga Tri Raeros 29111314 Joseph Enrico 29111349 Karina Soedjati 29111309
Exhibit 1 Annual Passengers
Year Carnival CLIA Lines
Passegers Carried
Anual Growth
Passegers Carried
Anual Growth
1994 1035037 15,33% 4448000 -0,71%
1995 1185588 14,55% 4378000 -1,57%
1996 1343356 13,31% 4656000 6,35%
1997 1517330 12,95% 5051000 8,48%
1998 1535359 1,19% 5428000 7,46%
1999 1837764 19,7% 5894000 8,59%
2000 2044563 11,25% 6882000 16,76%
2001 2290801 12,04% 6906000 0,35%
2002 2482231 8,36% 7640000 10,63%
2003 2854476 15% 8300000 8,64%
2004 3037948 6,43% 8980000 8,19%
Exhibit 2 The Fleet
Ship Class of
ShipYear
LaunchedGross
Tonnage StateroomsDouble
Occupancy1 Holiday Holiday 1985 46052 743 14522 Celebration Holiday 1987 47262 743 14863 Fantasy Fantasy 1990 70367 1026 20564 Ecstasy Fantasy 1991 70367 1026 20525 Sensation Fantasy 1993 70367 1026 20526 Fascination Fantasy 1994 70367 1026 20527 Imagination Fantasy 1995 70367 1026 20528 Inspiration Fantasy 1996 70367 1026 20529 Carnival Destiny Destiny 1996 101353 1321 2642
10 Elation Fantasy 1998 70367 1021 205211 Paradise Fantasy 1998 70367 1026 205212 Carnival Triumph Triumph 1999 101509 1379 275813 Carnival Victory Triumph 2000 101509 1379 275814 Carnival Spirit Spirit 2001 88500 1062 212415 Carnival Pride Spirit 2002 88500 1062 212416 Carnival Legend Spirit 2002 88500 1062 212417 Carnival Conquest Conquest 2002 110000 1487 297418 Carnival Glory Conquest 2003 110000 1487 297419 Carnival Miracle Spirit 2004 88500 1062 212420 Carnival Valor Conquest 2004 110000 1487 2974
From the exhibit 1& 2 :In winter 2004, more than 3
million passengers would sail with Carnival
Carnival, launch 110.000 ton, 2974 passenger Carnival Valor, the 20th ship.
2005, Carnival Liberty joined the fleet, Carnival’s capacity lead the industry.
Buyback, $1 billion stock and 20% quarterly dividen increase to $0,15 / share
The Cruise Industry
1970, carried 500.000
passengers
2004, projected more than 10 million guest
Dickinson : 300 millions person trips/year. We
carried 3 million guest
Dickinson noted, only 16% of the North American market had ever
cruised
Industry EvolutionMid 1960s, shifted to pleasure cruisingThe ships carried 1800 to 3800
passengers.70 brands serving the North American
market since 1960s.Carnival Corporation, Royal Carribean
International Ltd, Star Cruise dominate nearly 95% of the market.
Carnival Corporation became the largest cruise company in the world
Exhibit 3 North American Cruise Capacity & Market Positioning, 2004
ShipsDouble
OccupancyMarket Share
Market Positioning
Carnival CorporationCarnival Cruise Lines 20 44934 23,20% Contemporary
Princess 14 28050 14,50% PremiumHolland America Line 12 16937 8,80% Premium
Costa Cruises 2 4224 2,20% ContemporaryCunard Line 2 4411 2,30% Luxury
Womdstar Cruises 3 604 0,30% DestinationYachts of Seabourn 3 624 0,30% Luxury
Total: 56 99784 51,60%
Royal Caribbean International
Royal Caribbean International 19 45570 23,50% Contemporary
Celebrity Cruises 10 16116 8,30% PremiumTotal: 29 61686 31,90%
Star CruisesNorwegian Cruise Line 10 17890 9,20% Contemporary
Orient Lines 1 845 0,40% DestinationTotal: 11 18735 9,70%
Other CLIA-affiliated brands
Crystal Cruises 3 2960 1,50% LuxuryDisney Cruises Line 2 1754 0,90% Contemporary
MSC Cruise 2 3180 1,60% ContemporaryOceania Cruise 2 1368 0,70% Premium
Radisson Seven Seas Cruises 6 2764 1,40% LuxurySilversea Cruises 4 1356 0,70% Luxury
Total 19 13382 6,90%Grand Total 115 193587
Target :- Contemporary (Mass Market)- Premium- Destination (Specialty)- Luxury
• Since 1990, more than 130 ships were launched, increase the industry 20%.
Carnival Cruise LineThe Carnival Corporation portfolio of 12
cruiselines and 75 ships covered each of the four North America market segment.
Carried 60000 passengers. Seabourn, 21000 passenger/year.
Ted Arison was launching Carnival in 1972.
Carnival “Fun Ships” started because they want everybody had fun. It were designed to include a wide range of activities and options for guests.
Overall Cruiser Customer
According Cruise Lines International Association (CLIA) :
Average cruiser was 50 years old, income $99000/year.
78% already married and sailed with their spouses
54% had taken their first cruise within 5 years and took 2,6 cruises in this period
The Carnival Customer
According Cruise Lines International Association (CLIA) :
The age : 55 (24%), 35 & 55 (40%), 35 or younger (36%)
The Product : Families, singles, honeymooners & multigenerational families.
Income cruiser : $65000
Carried 55% of married passenger
Promotion : TV, newspapers & direct marketing
Distributing The Carnival Product
Travel AgentsThe vital external sales but also the
expensive (Commison of 10%)
The agent’s commision one of the largest individual line
items on a cruise’s profit and loss
statement
Direct
Inbound :- 1-800-Carnival and
carnival.com- Only few customer
booked online,
Outbound :- Personal Vacation Planners (PVPs), is a
separate division- Proven to be an
effective sales
Delivering the Carnival ExperienceGuest typical booking time:
◦3-5 months before◦Last-minute
Information source for guests:◦Web◦Travel agents
Delivering the Carnival ExperienceCarnival didn’t get complete guest
information from travel agentsCarnival get guest information from the
Fun PassCarnival’s vision is to provide quality
service that exceed the expectations of the guests
Average cruiser spend $30-$50 per day on board, excluding gratituities
E-commerce applications includes precruise online sign-up for shore excursions and spa appointments
Sail & Sign CardPass to board / debark the shipSign-up for excursionsAs a credit card on the board
Carnival’s Information Systems275 employees shoreside and 45
shipboard IS managersAccumulated 2 years of
individual voyage dataUse data for pricing decisions
and measure travel agents’ performance
On-board applications:◦Property Management System (PMS)◦Point of Sale (POS) Fun Sales
System (FSS)
The Potential Value of Customer DataLoyalty programs:
◦Redeemable cruise points◦Recognition card
Fear that loyalty spending may yield low return
Consumer Response System (CRS) to track service recovery efforts for complains
Partial Organizational Chart(from exhibit 5)
Bob DickinsonPresident and
CEO
Roberta Jacoby
Senior VP Corp Training
Paul ZacharskySenior VP Finance
Vicki FreedSenior VP
Marketing&Sales
Natko NincevicSenior VP
Hotel Operations
Brendan CorriganSenior VP
Cruise Operations
Myles CyrVP & Chief Information
Officer
Onboard Hotel
Directors
Onboard Captains, Pursars
Dwayne Warner
VP Strategic Automation
Edie Bornstein
VP Business Development
Brenda Yester
VP Revenue Managemen
t
Maurice ZarmatiVP Sales
Terry Thornton
VP Marketing Planning
Christine Arnholt
VP Marketing Services
Shannon Balliet-Antorcha
Manager Revenue Enhancement
Mike HunssingerManager Revenue
Enhancement
Diana Rodriguez-Velazquez
Director Database and Internet Marketing
Carnival Corporation and PLC Cruise Brands(from exhibit 6)
North Amer-icaEuropeUnited KingdomAustraliaGermany
Double Occupancy Amount
Typical Activities Available on a Carnival Cruise(from exhibit 7)
Photo GalleryTravelogFormalitiesShore ExcursionsShops on BoardShogun Club
CasinoPark West Art
AuctionCarnival Golf.com
The Web Internet Cafe
Funship Airbrushed Tattoos
Spa CarnivalGymTheatreMusic and DancingActivities Schedule
Principal Shoreside Software Systems(from exhibit 8)
Oracle FinancialsReservationsRevenue AccountingCornerstoneLawsonI2Carnival.com
Principal Shipboard Software Systems(from exhibit 8)
Shipboard Property Management System (SPMS) Fun Ship Sales (FSS) Silverware Iverson Ocean Player Club Concession Systems Consumer Response System (CRS) Interactive Television Crew Personal System (CPS) Crew Pay Gratuity (CPG) Fun Time Info SHIPsql VingCard Door Lock
Financial Analysis(from exhibit 4)
Summary of Balance Sheets (millions of US$) 2004 2003Current Assets 643 610Total Assets 27,635 24,491Current Liabilities 5,034 3,310Total Liabilities 11,876 10,698Total Equity 15,760 13,793Total Equity and Liabilities 27,636 24,491
Summary of Income Statements (millions of US$) 2004 2003 2002 2001 2000
Revenue 9,729
6,718
4,383
4,549
3,779
Gross Profit 5,483
3,838
2,619
2,661
1,720
EBIT 2,168
1,391
1,038
1,001
991
NAT 1,854
1,194
1,016
926
965
Summary of Statement of Cash flows (millions of US$) 2004 2003 2002CF from Operating activity 3,216 1,933 1,469CF from Investing activity -3,089 -2,433 -2,061CF from Financing activity -79 826 -198
Financial Analysis(from exhibit 4)
Ratio Analysis
2004 2003 2002 2001 2000Comment
Current Ratio 0.127731 0.18429 OK
Total Asset turnover 0.351981 0.274305 GoodDebt to Total Asset ratio 0.429745 0.436814 OK
Debt to Equity ratio 0.753553 0.775611 OK
Gross Income Margin 0.563573 0.5713010.59753
6 0.584964 0.455147 OKOperation Income Margin 0.222839 0.207056
0.236824 0.220048 0.262239 OK
Net Income Margin 0.190564 0.1777310.23180
5 0.203561 0.255359 OK
EPS 2.31 1.66 1.76 1.82 1.61 Good
DPS 0.53 0.44 0.42 0.42 0.42 Good
ROE 0.11764 0.086566 Good
ROA 0.067089 0.048753 Good
SWOT Analysis
Strengths
• Carnival is the largest cruise line in the world• Higher market share than its competitors• It is the most popular choice among customers who
think of a cruise vacation• 98% guest satisfaction rating• Carnival has acquired several companies in different
market segments of the cruise industry• Has a good relationship with many travel agents• Offer many interesting facilities and entertainment
programs on board• E-commerce application and Sail & Sign card to
facilitate the guests
SWOT Analysis
Weaknesses
• Customer loyalty was low• Relied heavily on travel agents• Aggresive direct marketing could affect relationship
with travel agents• Less effort to create customer’s loyalty• Didn’t have enough consumer data
SWOT Analysis
Opportunities
• The cruise industry appeals to a broad range of demographic groups
• Large untapped market of people that have not cruised of 84%
• Many of the potential passengers have expressed interest in taking a cruise as a vacation alternative
• Strong annual growth• Offer more destinations• Expand to other countries like Asia
SWOT Analysis
Threats
• There are threats from diseases like SARS and other epidemic health concerns in areas where the company does business
• Hurricane and bad weather• Seasonal demand• Changes in Government regulations (in areas of ports,
customs, labor, immigration, gambling, security etc)could impact the company’s financial position negatively
• Tight competition
Recommendation The customer data could be used to enhance the customer's
experience by doing the following: Based on age and marital status of customers, special suitable
activities can be offered, like excursions and spa services for couple For repeat guests, offer special discount on their favorite drinks
from the previous visit Customer feedback from Customer Response System can be useful
to make the necessary adjustments to the quality of service, and to retain the customer
Offer a birthday or anniversary package, with special discount or special gift
Create a seasonal themed cruise vacation like Haloween, Valentine, Christmas, etc
Create a special embarkation line for repeat guests Send informational or promotional e-mail based on the guests’
travel pattern, preferences, and on-board purchases Add new on-board facility and entertainment to attract more guest