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CRUISE BUSINESS GROUP 3 Group members Yao Ju M99Y0206 James M99Z0216 Ninh M997Z211 Melva M997Z227 Nancy M997Z228 Allison M99Y0105 SELLING AND MARKETING OF CRUISE History of cruise ship - Cruise ships have developed since the last 150 years - At first, ships were made for discovery, post, transportation - 1801: The first ship using steam started to work - 1960s: Cruise ship revolution began - 1980s: Cruise ship industry got stronger & stronger 1990s: +The first ships with well equipped facilities, recreations, etc started to work +Global cruise industry averaged an 8.5 percent annual growth in bookings After 2002: cruise industry growth slowed a little bit due to concerns about terrorism, high energy costs, increased population harbors, etc. Areas of Coverage Type of Cruise in the Market Thematic Cruises Different Cruise Brands Managing Yield on Cruise Pricing & Promotions Understanding What’s Cruising Manage yield with promotion Promotional Partners Promotional Strategies Marketing Communications Distribution Channel Marketing with promotion Understanding Booking Network What is Cruising ? Apart from the Sea Experience, you sell various facets like: Size (Facilities) Floating Resort (Balcony class) Entertainment (Broadway Show) Appeal (Lifestyle, Prestige, Fun) Different Types of Cruises Cruise Ships – Not just for Grandma and Grandpa anymore What’s the reason? Some fortuitous events beyond the companies’ control (such as the influence of Titanic movie) Better marketing programs in Cruise industry => satisfied all the market segment Let’s make it clear by focusing on Marketing program! Understanding Branding Positioning Correct Marketing Strategy Types of Cruises in the Market Destination Cruise Special or Theme Cruise (Singles Cruise, Wedding, Party, Spa & Wellness, Kids…) Cruise Variatations / Product Extension (Fly Cruise, Coach Cruise, Train Cruise) Budget Cruise (Easy Cruise) Other A Look at some of the theme Cruise Gourmet Cruise Golf Cruise Romance Cruise Heritage, Culture & Gourmet Kids Cruise HoneyMoon Cruise Emeraude Managing Yield on Cruise Yield Management is a from of Revenue Management for Increment Revenue. It can be obtained from: Different types of Cabin Different promotions across/ country Different promotions within one country Onboard expenses Miscellaneous purchase onboard like Spa, Casino, Photo Gallery, Shopping… Pricing & Promotions Early Bird Special Seasonal (Peak, low season) Tactical Offers Incremental Offers (by 3 get 5) Loyalty Program Special Exclusive Memberships’ Special Cabin Upgrade Last minute / Standby Offers Promotional Partner Travel agents Corporate/ Incentive Houses National Tourism Organizations Port Authorities Banks, Spas, Telecoms ect. Clubs and Associations Airlines and Travel Partners Regular Customers Promotional Strategies Pricing/ Tactical Strategies Theming Strategies Collaboration Strategies New product launch New product Extension Sponsorship MARKETING COMMUNICATIONS An Advertising Strategy is a message that brings forth the product or brand’s value proposition. Slogan & Brochure Once you’ve Cruised you’ll never want it to end Furama “Vietnam’s truly beach resort” “Summer in style 5 star Plus” “ Best beach break on the best beach of the world” Brochure MARKETING COMMUNICATIONS Media Advertising Direct Advertising Outdoor Advertising In-Store Advertising E- Advertising Event Advertising Relationship Advertising/ Personal Selling Trade Advertising Advertisement Advertising create awareness of a product and bring forth the target audience to buy the product. Allows the company to convey the features & unique selling propositions of the product. Advertisement Branding Advertisement not only feature the product but also avail concepts like lifestyle, prestige. Tactical Advertisement has a strategy and tend to focus on price Thematic Advertisement focus on a theme or a particular topic, area. Different types of Advertisement Direct Advertisement GSA Advertisement PSA Advertisement Co-operation Advertisement Cruise Distribution Channels Travel Agents (GSA, PSA) Direct Booking Online/Website Global Distribution System (Galieo, Sabre, Abacus, Amadeus) Call centre Promotional Partners Distribution Partner: GSA GSA is General Sales Agent GSA is similar to a Sales Representative that assist the company in the areas of sales or even marketing of the product it represents. The Selection is based on reasons like the GSA’s business & booking network, the potential to expand and grow the market for the product. Distribution Partner: GSA The GSA will receive commission, incentive, rebates and sometimes consultancy fee for the sales and marketing activities it has done on behalf for the product and the company Cruise Lines GSA Agent A Agent B Sub Agent I Sub Agent II Distribution Partner: PSA PSA means Preferred Sales Agent PSA are exclusive agents appointed by the company to market the product with special commission, incentive, rebates on behalf for the sales and marketing activities done for the product. Usually they form a consortium of agents or a grouping and will receive guidance and instructions from the product companies on sales and promotion strategies Cruise Lines Preferred Agent A Preferred Agent C Preferred Agent B Future Trends Uncertain & varied outlook Reduced price had led to a drop in standard Discounting owing to competition had led to more innovative products, More innovative ways of making onboard revenue More added facilities like ice skating rink, roller coaster, bungee jumping, bowling alley, virtual reality games Future Trends More potential Markets More multi-generations, singles going onboard Kids will be going for free at times More adventure and expedition cruises for emerging markets New Traveling Concepts More theme cruises More international spas onboard cruise More “homeland” Cruising in US Future Trends Better Entertainment Production shows are costing more from US$500.000 to 1 million with performers’pay, costume, cleaning and repair, backdrops, lightings, music & orchestra, royalties. Future challenges of cruise ship Terrorist attacks & political unrest around the world may dispute industry revenues again Over-capacity: The substantial growth & profits cruise lines during the 1990s spurred the investors to build more and bigger ships at an increasing rate How to find a way to increase the growth in passenger booking to fill the growing capacity & recoup the huge investment in new ships. High competitiveness: The cruise ship industry is highly concentrated & dominated by large companies (Carnival, Royal Caribbean, North America) Evolution of New Cruise concepts Compete with Size, Facilities Larger Cabins, Verandas More Dining Options New Concepts like spa, golf More entertainment, sports Innovative Enrichment Program Exciting Shore Excursion Freestyle Cruising Thank you!