Is Your Brand More Like Carnival or Royal Caribbean? 5 Ways To Tell.

Recently my family and I took a Caribbean cruise. We’re not new to cruising, in fact this was our seventh. But the first six were with Royal Caribbean so this was our first experience with the Carnival brand. I’ll save you the suspense and tell you that it will also be our last, but what I did find interesting was observing the vastly different strategy that each brand employs from its website, to customer service, to the ships themselves and their excursions. I wasn’t expecting the same standard on Carnival as I had previously experienced with Royal, but I wasn’t prepared to find the differences quite so astounding. Fortunately it wasn’t a complete loss as I still enjoyed family time and the experience helped me better point out 5 differences to consider when positioning your brand in the market.

1.  Does Your Product Appear To Be Mass Market or Premium?: Royal Caribbean differentiates itself based on exceptional service, ship quality, variety of itineraries and is, in its own words, “maniacal about innovation and continuous improvement”. Witness the capsule on the new Quantum ship, inspired by the London Eye to take guests high above the ship for truly a bird’s eye view. Or its skydiving simulator and zip lines. At Royal Caribbean the ship is considered the destination, with many activities, extensive shopping and dining experiences. It offers Vegas style entertainment, Broadway shows, truly luxurious spas, well equipped gyms and cinemas. Some ships offer ice skating rinks or inline skating. The quality of the finishing is akin to the Four Seasons Hotel with high end art, beautiful furniture and attention to detail. There were many days of cruising with Royal when we decided not to go into port so that we could enjoy the amenities of the ship without the crowds. Royal is able to up-sell 28% of its revenue on board compared to 25% for Carnival.

Carnival Cruise Lines, on the other hand, is clearly a mass market brand where the ship is definitely not the destination, in fact we couldn’t wait to get off of the ship to get to a destination. The finishing was more like an aging Holiday Inn and the food was very ordinary (think theme park). Not being a gambler, there wasn’t much to do on the ship other than attempt to play on a mini golf range that was falling apart, play shuffleboard on a court where the rocks didn’t slide, wait for a ping pong table (at least on the days when they didn’t run out of balls) or sit by a really cold pool. I even tried the water slide which was not particularly exciting. While the entertainers clearly gave 100% each night to the main show, the quality of the sets could not compare and entertainment options available were quite limited. The spa was plain and the gym was practically unusable due to the creaky old weight machines, the temperature, and the fact that to run on one of their limited treadmills you would find yourself staring half at the wall.

To check: Does your physical presence reflect your brand positioning? Does your website? Do the services you offer? Pay attention to every detail.

 

2.  Do You Cater To The Special Needs of Your Clients? While there was a large Asian and Indian population on our Carnival cruise, everything on the ship was Americanized. Although in the main dining room there was one vegetarian option each night, as I watched my fellow guests stare in wonder at the fried food buffet, or try to find some vegetables or some hot sauce to go with their eggs, I thought about how these little details could have made their cruise more enjoyable. As a non-smoking family I also didn’t enjoy that literally the only way to cross the ship was either on the windy upper deck or through the smoke filled casino. And the only entertainment option between dinner and the show was a band in that same casino.

At Carnival the strategy is clearly to keep costs low by making one size fit all.Royal takes a different approach. I was always fascinated by the variety of international options at the buffet (I had no idea that won ton soup was a breakfast item). Recognizing the value of its frequent cruisers, their loyalty program offers priority embarkation and wait lists, free internet, and private areas on the ship. The dinner menu is extensive with options to suit multiple dietary preferences, including healthy selections.

To check:  Put yourself in the shoes of each of your Target Personality Profiles. How does your service address their individual needs? How do you train your staff to deliver WOW?

 

3.  How Do You Take Advantage Of Technology? Royal Caribbean continues to make improvements in its website and has launched mobile apps. On board it offers touch screen ship maps with activity times and improved internet connections. The embarkation process uses technology to flag agent availability. Suffice it to say that not only does Carnival suffer from a lack of technology innovation, but it’s website is horribly slow and even misleading. A big reason why we chose our cruise was the photos of the amenities and restaurant selections on our ship. Imagine our surprise when we boarded and found that most of what had appeared to be on our ship based on the website, was actually on a different ship. Not cool Carnival.

To check: Do you use secret shoppers to make sure your website clearly answers your clients’ questions in a way that is enjoyable to use? At which client touch points could you use technology to improve their experience?

 

4.  Do You Put Yourself In The Shoes Of Your Clients? I have an eye for process, when it works and when it doesn’t, and here the differences between the brands were extreme. The embarkation process at Royal is smooth. There are different lines for different decks, very helpful staff to guide you to the next agent, and if you have a child, they receive their wristband prior to boarding. The in room TV works efficiently to check your bill and book excursions, and in the unlikely event you do need to go to guest services they are friendly and quick. Bartenders go the extra mile to try and remember your favorite drink and even if you are on the “My Time Dining” plan they try to place you with the same waiter to build a relationship with someone who remembers what you like and isn’t shy to offer you extras.

The Carnival embarkation experience is horrible, made worse by the fact that this is the guest’s first exposure to the brand. Everyone ends up in the same, long line and agents at either end hold up paddles when they are available, requiring guests to trek down the entire length of the room with their bags, often creating traffic jams and bumping into guests who are leaving the agent and going the other way. After boarding we were directed to an empty room to get a child’s wristband, followed by an unsuccessful attempt to catch the eye of a crew member during the safety drill, followed by a failed try at the kids club, and finally our first (of many) visits to the long line of guest services which seems to be the nexus for any question you may have on the ship, including dining, your bill etc. Always with a long line and too few agents, I spent far too much of my vacation at guest services.

To check: Where are the bottlenecks in your service? Hint – if you sell something, the time from client purchase decision to walking away with the product or service must be lightening quick. If you deliver a service, speed of response and attentiveness are key.

 

5.  Pricing – The Balance Between Brand Image and Sales: At list price, for a comparable 4 night Bahamas cruise, Royal Caribbean is able to charge about one third more for its staterooms than Carnival. Of course with deals closer to the cruise date the gap can narrow between an early booked Carnival cruise and a late booked Royal cruise. Staterooms have a limited shelf life and they don’t make the company any money when empty so a tradeoff must be made between pricing low enough to fill the stateroom while not pricing so low that it impacts the brand value. Both cruise lines employ this strategy which appears to be working well for them as Royal and Carnival enjoy occupancy rates of 104.7% and 105.1% respectively. However at some point, a premium brand must forgo sales in favor of retaining its price floor or risk losing its premium status. If it becomes too accessible then the high value guests may lose interest.  The politeness and level of sophistication of the crowds on each ship were noticeably different.

The bottom line is not what you might expect: Carnival is a much larger company than Royal at 100 ships compared to 41, and it is also more profitable (6.9% net income compared to 5.9%). So why isn’t the luxury brand more profitable? Because it costs more to deliver the level of quality and service of the Royal brand and Royal is not able to charge high enough prices to cover the extras. A potential customer looking online for a cruise won’t necessarily understand the difference in the experience, they will simply look at the prices of both brands to similar destinations, and look at artfully taken photos to conclude that while Royal is possibly nicer, it may not be THAT much nicer. So the market tells Royal that customers will pay about a third more. Even families like mine who have experienced the Royal brand didn’t realize it was THAT much nicer until we had experienced Carnival. Royal finds itself competing more on price than it would like, to fill staterooms with an expiration date because it has not been able to adequately explain the extra value of its brand.

To check – My clients typically find it more attractive to think of themselves as a high end brand, which naturally leads us to the financial question, “what price will the market bear for your product or service?”. If you start with the price and work backwards to the cost of delivering the level of service you envision, and you don’t like the resulting profit margin, then you need to either rethink your brand positioning, drop some of your extras and reduce delivery costs, or else develop a plan to price your products or services to deliver the profit margin you need.

My bottom line: While it was the amazing price deal and the nice looking ports that swayed us in the direction of Carnival for our recent vacation, it is Royal Caribbean’s commitment to quality and service that will send us back to them for our next vacation. In fact, I think the best strategy Royal could employ for guest retention would be to offer them a free cruise with Carnival. Nothing else could make us appreciate them more!

Dear Royal Caribbean – I’m so sorry that we left you and I promise we’ll be back next time.