Is it still possible for cruise lines to differentiate from the competition in such a large industry?

 

Carnival Corporation and Royal Caribbean Cruises ltd are at the moment by far the most dominant market players in the cruise industry and have together with Norwegian Cruise Line Holdings ltd more than 80% of the complete market share (Cederholm, 2015). So the question is: ‘How can someone beat this competition or at least make sure to count in the cruise market?’

First of all it is very important to differentiate from the competition, especially as the cruise industry is an industry with heavy competition worldwide. It is important that if one wants to differentiate from the newest strategy trend in marketing to apply ‘Customer Engagement’. Differentiation can be done by interaction with the customers for example. At the moment Virgin cruises is busy with asking their future clients for ideas about how they want the new cruise experience to be. However regarding to Peelen & Beltman (2013) suppliers also need to take into consideration if it will ultimately be all worth it. Customers nowadays have very high expectations as already immense cruise ships exist with all the possible facilities that one can think of.

At the moment there are already such a variety of unique experiences which cruise lines presents on board in order to beat the competition. Hereby one can think of robotic bartenders or sky-diving simulators for example (Cripps, 2014). When a cruise line wants to beat the competition it is very hard to come up with better and more unique experiences, however this is not always necessary. The model of Michael Porter about the three generic strategies can be of used if one wants to go for lower costs or for differentiation (Porter, 1979).

cem-blog-4-week-1
Porter, M. 1979. Three generic strategies.

During the last decades technology became very important as well as acquiring loyal customers. With technology it is easier to attract the right customer on the right time. Afterwards a company can focus on the emotional side in order to get a connection and build a relationship together (Chetwynd, 2016). With technology people can also read reviews and give feedback. Reviews are by far the most trustworthy and valuable information for customers before they book with a certain company.

The CRM strategy is successful when the competition does not have to be seen as competition anymore. The client will completely trust a certain cruise line and will not feel the need to look at what other cruise lines have to offer. According to Rowe & Barnes (1998) there will be a two-sided relationship whereby both partners show trust and commitment towards each other. Eventually when a cruise line achieved this with its customers it has a chance of a long-term competitive advantage.

 

 

Bibliography

Cederholm, T. (2015). Carnival boasts largest market share of cruise passengers. Market Realist. Retrieved on September 13, 2016 from http://marketrealist.com/2015/01/key-overview-carnival-worlds-largest-cruise-company/

Chetwynd, C. (2016). How to measure customer experience. Raconteur. Retrieved on September 16, 2016 from file:///C:/Users/Britt/Documents/Documents/NHTV%20year%204/customer-experience-and-loyalty%20CEM%20article%20week%201.pdf

Cripps, K. (2014). Skydiving and robot bartenders: The world’s ‘most high-tech’ cruise ship. CNN retrieved on September 14, 2016 from http://edition.cnn.com/2014/11/06/travel/cruise-ship-quantum-of-the-seas/

Peelen, E. & Beltman, R. (2013). Customer Relationship Management. Harlow, England: Pearson.

Porter, Michael E. (1985). “Competitive Advantage”. Ch. 1, pp 11-15. The Free Press. New York.

Rowe, W. & Barnes, J. (1998). Relationship marketing and sustained competitive advantage. Journal of Market-Focused Management. 2, 3, 281-97.

 

 

 

 

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4 thoughts on “Is it still possible for cruise lines to differentiate from the competition in such a large industry?”

  1. I can definitely see your argument. By improving and succeeding at two communication, organisations might be in a better position to influence consumer brand loyalty. Thus, stand above the competition.

    You might find this article interesting; “Blue Ocean Strategy: (by) W. Chan Kim 2005”. I was reminded of it when I read your comment “when the competition does not have to be seen as competition anymore”.

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    1. Thank you very much Richard for your comment and for the recommendation on the article of Chan Kim. I will definately read this article through in order to perhaps improve my blog or at least improve my knowledge.

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  2. A nice subject.
    Good that you used the mandatory literature and than added some of your own findings.

    A couple of practical tips.
    – Since this blog is about the cruise industry, it is a good idea to categorize it as such and put the word “cruise” in the title.
    – You might try to get to a clearer conclusion on the question in your headline.
    – Often the blog gets more lively if you add some examples of best practices in the cruise industry.
    – On a business blog you use your normal name.
    You are allowed to update/upgrade your blog at any moment before the deadline.

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    1. Thank you Mrs. Visser for you nice comment and your useful tips. I will work on the tips dicussed in order to make the blog more professional. Besides I will also use these tips for my other blogs and for those of my group members.

      Like

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