Competitor Analysis of Leading Cruise Brands

Celebrity Cruises Competitor Analysis Case Study

The $150 billion cruise industry has been hard hit by the global pandemic after a decade of expansion and growth.  This competitor analysis gives a peek into what the industry faces today.

Cruise is an intensively competitive industry, with several major holding companies (i.e., Carnival, Royal Caribbean, Norwegian Cruise Line Holdings) with multi-brand portfolios. There are also more focused players, like Crystal, Viking, etc. The brand portfolios of the holding companies include:

  • Carnival Corporation: Carnival, Princess, Holland America, Cunard, Seabourn, others
    • Royal Caribbean: Royal Caribbean, Celebrity, Azamara, Silversea
    • Norwegian Cruise Line Holdings: NCL, Oceania, Regent Seven Seas

This large market can be segmented in many ways, including by pricing tier, size of ships, length of itineraries, and travelers addressed.  Some recent trends include growth in solo travelers , luxury expedition cruising in polar waters and micro-cruises of three days or less.   

Insight to Action worked with Celebrity Cruises to conduct a comprehensive competitor analysis across a variety of dimensions. The focus was to identify opportunities for Celebrity to capitalize on strengths and better differentiate itself through its communications.  For purposes of this work, the competitive set was focused on the six most relevant brands as well as Celebrity.

Competitor Analysis of Leading Cruise Brands
Competitor Analysis of Leading Cruise Brands

Competitor Analysis Work Outputs: Comprehensive, Measurable and Summarized

Comprehensive competitor go-to-market analysis looked at seventeen areas, with multiple measures in each area:

  • 1. Product: Current and future fleet. Measures included: total number of ships, average fleet age, passenger space ration, fleet expansion, capacity, percent of room with balconies, etc.
  • 2. Itinerary: Measures included itinerary length by major regions (e.g., Caribbean, Europe, Alaska, Mexico, Hawaii, Canada/New England, Bahamas, Pacific Northwest, Galapagos, Panama, South America, Bermuda, Transatlantic, Asia, World, Australian/New Zealand). 
    • Example finding: At the time, Celebrity offered more itinerary length options and ports of call in the Pacific Northwest than Holland or Royal Caribbean
  • 3. Deployment: Measures included ownership of a particular region, number of ports of call, ports with overnight stays, and consumers’ first choice for cruise line in a geographic area.
    • Example finding: Some brands had ownership of a particular region, for instance, Holland and Princess were dominant in Alaska.  Crystal, Oceania and Holland focused on overnight stays
  • 4. Pricing: Measures included APD (average price per day), price changes, average cost of representative itinerary, e.g., 12-day Mediterranean cruise per person, inside stateroom), absolute price levels, percent of cruise prices that included a discount
    • Example insight: At the time, only Carnival appeared to have a unique price strategy, low price leader on APD, clear consumer visible pricing strategy, low absolute price points and pricing that fit with its positioning strategy
  • 5. Onboard experience: Measures included crew to passenger ratio, how the firm describes its experience, analysis of recent experience additions/enhancements, any experience programs, Conde Nast Readers’ Survey results, Berlitz ratings
    • Example insight: At the time, Crystal was a clear winner.  Food had become hard to win on, as the standards in the industry were high across most brands
  • 6. Strategic brand partnerships: Measures included cuisine partnerships, activities/enrichment partnerships, and business partnerships
    • Example insight: At the time, Crystal, Royal Caribbean, Celebrity and Holland were using much more “borrowed equity” from relevant partners.  For example, two of Crystal’s partners were Neiman Marcus and Sotheby’s. Oceania and Carnival had very few partners
  • 7. Target consumer and actual mix vs. target: Measures included the stated marketing target, average age of people in party, type of passengers for whom most recent cruise is perceived as appropriate, percentage of passengers on first cruise
    • Example insight: At the time, Holland, Princess and Celebrity did not have the clarity of target definition.  Many were targeting “Boomers” somewhat generically
  • 8. Positioning strategy: Measures included the stated positioning strategy and the advertising tagline.
    • Example insight: At the time, Celebrity, Crystal, Oceania and Holland had very enrichment focused positioning strategies
  • 9. Consumer-perceived brand equity and alignment with brand promise: Measures included brand imagery ratings such as high level of service, quality of food, comfort and elegance, good value for price paid, guest satisfaction surveys, and how well their recent cruise compared to expectations.
    • Example insight: Celebrity’s equity strengths were aligned to its positioning and onboard experience differentiators
  • 10. Advertising spend/marketing mix:  Measures included media spending, share of market vs. share of voice analysis (SOM/SOV), and types of media
    • Example insight: As shown on the graph, Carnival overinvested in media relative to its share of market and was by far the biggest investor in the brand. Smaller competitors may not break through.
    • Competitor Analysis of Leading Cruise Brands
  • 11. Creative strategy: Measures includeda review of print, TV and online communication materials, and a PR assessment
  • 12. Consistency in marketing strategy: Measures included consistency of communications, consistency of spending, and brand imagery ratings over time
    • Example insight: Royal Caribbean was very consistent with its focus on the active traveler and a consistent marketing platform for consumer and trade
  • 13. Consumer loyalty programs: Measures included number enrolled, benefits offered (e.g., upgrades, referral benefits, future sailing discounts, reciprocal loyalty), eligibility, membership tier structure, program rewards/currency, onboard services and privileges, onboard events, gifts, discounts and amenities, pre-cruise planning, communications, other member-only privileges
    • Example insight: Celebrity delivered strongly on attractive discounts and upgrade benefits, onboard benefits and pre-cruise/planning benefits 
  • 14. Agent business, programs and equity: Measures included the percentage of business through agent, percentage of consumers who claimed they used a travel agent, trade spending share, agent ratings of top 3 cruise lines, agent ratings on how well they like working with cruise lines, how passengers reported learning about cruise line, agent-perceived equity attributes on ships, crew, food, entertainment, and services
    • Example insight: While most of the leading cruise lines were well-rated by agents, Celebrity’s food was a notch above
  • 15. Salesforce and call center: Measures included direct sales force size and structure, and size of the inside consumer call center
    • Example insight: Carnival had the greatest focus on website and inside sales vacation planners
  • 16. Financial strength: Measures included revenue, net income, earnings per share, debt levels, and how they fit into their owner’s portfolio
  • 17. Organizational culture, senior management background and likely playbook: Measures included leadership team, time in position, background in industry, articulated culture, and turnover

Blue Ocean Strategy analysis was also reviewed as an illustrative approach for Celebrity to consider. While the example below combines several high-level areas, this could be done for a specific area, such as loyalty programs and experience.

Competitor Analysis of Leading Cruise Brands

How would your brand benefit from a comprehensive and measurable competitor analysis? Contact us to start a conversation with the Insight to Action experts.

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