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Cunard line , Ltd.

Cunard line , Ltd.

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Cunard line , Ltd.

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  1. Cunard line , Ltd. Managing Integrated Marketing Communications MKT 642 By:John Dehmardan

  2. Background • Subsidiary of Trafalgar House • Cruise and steamship business since 1840 • Advent of jet travel • Luxury vacation business

  3. The Ships • Cunard offered cruising on seven ships • Luxury (5-star) category: - Queen Elizabeth 2, Sagafjord, Vistafjord, Sea Goddess I, Sea Goddess II • Premium ( 4-Star) category - Cunard Countess and Cunard Princess

  4. Queen Elizabeth II • The finest cruise ship in the world • Offered ultra-luxury accommodations and exquisite service • Capacity of 1850 passengers • It was marked as the ultimate in cruising • Traveled between New York and Europe • It was also used in the Caribbean • High season:$3000 to $15000 per person • Low season:$2400 to $12000 per person

  5. Sagafjord and Vistafjord • Ultra-deluxe five-star cruisers • Positioned as ultra-luxury cruisers and offered services at the same level as QE 2 • Sagafjord: Primarily out of American ports to the Caribbean, Alaska and the South Pacific • One annual round-the-world cruise • Capacity of approximately 550

  6. Sagafjord and Vistafjord • Vistafjord: Five star cruiser • It was based in Europe and was used primarily in that part of the world • Capacity of 750 passengers

  7. Cunard Countess and Princess • Considered 4-Star (premium) cruise ships • Less formal and less expensively priced • Positioned as casual • Marketing for them tended to be more oriented to their destinations • Capacity of approximately 800 passengers • Countess: Cruise among Caribbean ports • Princess: Mediterranean and Europe • High season: Range from $1700 to $6500

  8. Sea Goddess I & II • Yacht-like ships for “intimate” ultimate deluxe cruising • Atmosphere of wealthy person’s yacht • Capacity of only 58 couples • $800.00 per person per day • Sea goddess I:six months in Europe and six months in Caribbean • Sea goddess II: six months in orient and six months in the Mediterranean

  9. Queen Elizabeth II

  10. Queen Victoria

  11. Coronia

  12. The Industry and Cunard’s Segments • Cruise industry: 4 million boardings / year • Luxury segment: (5-star) approximately 8% • 10 luxury ships worldwide (5 Cunard ships) - Cunard has about 50% market share • Cunard’s demographics: - 40% sailed from Europe - 55% sailed from North America - 5% from other places

  13. The Industry and Cunard’s Segments • 60% of the company’s business with passengers domiciled in the United States • 95% of customers book their cruises through travel agents • Cunard cruise ships consistently achieve approximately 90% occupancy • 65% of passengers pay full list price

  14. The Industry and Cunard’s Segments • Luxury segment: Supply driven - As more luxury ships come into service, there is a stream of additional customers available to purchase cabins • Growth at an average compounded rate of 10% per year • Overcapacity • Discounting and price promotions

  15. Cunard Marketing and Marketing Communication • Cunard success: Excellence and elegance • Marketing Communications Mission: to develop and maintain Cunard image and to support each of the ships planning managers in their marketing activities ( 100% ) • Marketing budget: $20 million - 50% strategic, 50% tactical

  16. Cunard Marketing and Marketing Communication • Direct mail- 25% • Mass media advertising- 35% • 70% strategic • 30% tactical • Currently 50-50

  17. Cunard Marketing and Marketing Communication • Brochures and Travel Agent Co-operative Spending- 35% • Public relations and promotional activities- 5%

  18. First dilemma • “Sale-oriented” format with more emphasis on price for tactical advertising? - Price = revenues - Flexible pricing policy Market changes Purchase occasions Target segments

  19. First dilemma • Possible conflicts with strategic objectives • Creating a balance between brand image and tactical promotional efforts - Magazines : Building brand and develop a distinctive image - Newspapers: Tactical marketing to create short-term sales - Direct mail

  20. Company’s Image vs. Individual Ships’ • Directly related to the new organizational restructuring - Each group is semi-independent - An executive responsible for strategic and tactical planning to for each ship • Not a very good idea

  21. Which marketing communications elements? • Increasing competition: Requires increase in promotional efforts - Increase promotional activities “one-day sale” - Direct mail: stimulate demand, inform high potential prospect, and “close the sale” • Travel agents spending (35%) : Internet

  22. Success of the “One-day sale” • Should engage in more “sales-oriented ” efforts • Negative impact on brand equity • Frequent aggressive sales promotions should be avoided - Targeted - In response to aggressive price cuttings

  23. Happy holiday