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This is the identical customer that drives resort economics. In response to these competitive factors, the gap between resort and cruise ship operators is closing. The entry of resort companies Disney into the cruise market will mark a true blending of the resort/cruise vacation industry. Disney, for example will now provide Cruise Vacation Packages, giving guests three or four days at a Disney resort, followed by a three - or four-night cruise. Unlike many of its future competitors, however, Disney Cruise line will not offer gambling on their vessels. The entire package may be purchased by a single
phone call. Carnival Resorts and Casinos and Carnival Cruise Lines, need to explore ways to work more closely together. Internal Analysis: Strengths.1.) Carnival is exempt from most taxes in the United States.2.) Carnival is the world’s largest cruise-ship operator.3.) The organization’s marketing plan is innovative and effective.4.) Carnival’s break-even point is the lowest in the industry.5.) Carnival is in the process of increasing its berth capacity through new shipbuilding.6.) Additional revenue is generated by on-board activities.7.) Carnival has a presence in most cruise segments and is a leader in those segments.8.) Good website, easily used by the average vacation seeker.Weaknesses: 1.) Repeat passengers place pressure on personnel to develop itineraries.2.) Many of the company projections for growth in the late 1990s may have overlooked the industry over-capacity problem, and the industry-wide discounting that took place in the late 1980s may have spoiled passengers into expecting continued discounts.3.) Control problems tend to accompany rapid growth situations.4.) Cost of fuel for all ships must be very high.5.) Future commitments of ship purchases could burden financials in a slowing economy.Carnival’s strategy focused on the Fun Ship concept, beginning with the Mardi Gras, which targeted people of all ages. In recent years the driving force behind why a person needs to take a vacation has changed. Today vacationers look to get away from everyday stress, and opt for a stress-relieving cruise.
Carnival is considered the cruise industry’s leader, and in the past few years, Carnival has increased its market share through acquisition and joint venture. In 1988, Carnival acquired Holland America Line to expand its market share in Alaska, Mediterranean, and South Pacific. Holland America Lines (HAL) is an upscale line. It targets the older, more sophisticated cruisers with fewer youth-oriented activities and emphasizes on the beauty of the Alaskan wilderness. Carnival entered into the Asian market through a 50-50 joint venture with Hyundai Merchant Marine, one of the world’s leading marine shipping companies with knowledge of Asian Market, in order to expand its market worldwide.