Analysis CCL’s Strategy for entering the industry The strategy of Carnival Cruise Line to enter the industry was the comprehensive acquisitions of the companies already operating. In 1972, with the association of American Travel Services, the Carnival Cruise Line acquired two aging ocean liners from Canadian Pacific Empress Lines for $6.5 million. Following the acquisition, Carnival Cruise Line targeted first-time to introduce packages that included the airfare to port and the service to drop home after cruise. With the passage of time, Carnival Cruise Line started to offer passage to Caribbean ports, premier restaurant service for meals, and all forms of entertaining activities. Later, Carnival Cruise Line kept on adding the shipboard experience with a greater variety of activities, nightclubs, entertainment as well as varied ports to call to attract potential customers. CCL was Carnival Corporation 4
the first to use the multimedia advertising and establish a ‘Fun Ship’ theme promoting the ships as the destination. Carnival Cruise Line continued its strategy of mergers and acquisition. CCL acquired Holland America Line (HAL) for $400 million. Holland America Line (HAL) consisted of four ships that targeted high income travelers with cruise price averaging 25% to 30% more than the similar Carnival Cruise Line cruises. The acquisition of Holland America Line (HAL) included its major subsidiaries; Crystal Palace Resort and Casino, Holland America Westours, and Windstar Sail Cruises. During the regime of 1980s, the Carnival Cruise Line operated above 100% of its capacity and successfully maintained 30% annual growth in its revenues. Carnival Cruise Line then incorporated ‘superliners’ to exploit the other cruise market. However, the rising fuel prices has always been the problem for CCL. Later, in partnership with Atle Byrnestad, Carnival Cruise Line acquired 50% of Seabourn Cruise Line. The purpose of the recent acquisition was to cater the ultra-luxury market in the industry and approach South America, the Mediterranean, Southeast Asia, and the Baltics. After this event, Carnival Cruise Line further expanded its business by purchasing Costa Cruises, the largest European cruise line, for $141 million. For further, Carnival Cruise Line also acquired Cunard Line for $500 million which was later merged with Seabourn Cruise Line. Carnival Corporate Strategy The Carnival Cruise Line corporate strategy consists of several sub-strategies that is currently operating in the company. Much of the Carnival’s success can be aligned to its ability of consistently making their selves different from the other cruise lines. This was achieved by the Carnival Corporation 5
fact that Carnival Cruise Line used strategies which was not exploited by any other cruise operator in the history. CCL used multimedia as the basis of its advertisement promotions which was successful and put significant effect on the overall performance of the company.
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- Winter '09
- Finance, ........., Carnival Cruise Lines, Holland America Line, Cruise lines, Carnival Corporation & PLC, Carnival Corporation