Carnival Cruise Case Study Solution
Introduction
Carnival cruise is a global cruise line with headquarters located in Doral, Florida. Carnival cruise has been ranked the top largest cruise liens with respect to passengers carried annually. In June 2022, it recorded a fleet of 23 ships it was founded by Ted Arison on March 1972. As of 2021, it has a record of 40,000 employees and gross revenue of $1.803 billion. It is a multinational company serving thousands of people worldwide. Carnival cruise is among the ten cruise lines operating worldwide and is owned by the American-British Carnival Corporation & plc.(Lynda M. Applegate, 2005)
In 1990 they introduced the Fantasy class and Paradise in 1998 which was their eighth one. Fantasy was one of the largest cruises of that time and has an attractive and largest atrium at sea. In 2020, due to the pandemic disease of COVID-19, certain carnival lines like Fantasy, Imagination, and Inspiration were sold to reprocessing. Its current president is Christen D. Duffy who introduced two major lines Vista and Excellence emphasizing the brand to be American Cruise Lines.
Analysis
External environment
The most influential factors that have a significant role in the development of business and the market have direct relations with the external environment. The external environment is the vital factor that allows the company to sustain its business and build a strong market presence if the company can adequately regulate these factors. However the total ability and market worth of a company can find out by analysis of its external environmental factors including Opportunities, Threats, and PESTLE analysis. (Susanto, 2018)
PESTLE analysis
Political Factors
The political factors have a critical role to manage and regulate the business of Carnival Cruise which allow the company to sustain its business growth rate and develop a strong brand representation in the global market. The company hasstrong political relations across the globe that help the company to establish and expand its business globally however the most essential political factors for Carnival Cruise are as under:
- Carnival Cruise is a multinational company that has strong relations and links with different governments across the globe. The main aim of the company is to diversify business and expand its business across the globe so that is why they need to bring diversifications in the international regulations in various locations like Panama, London, and Wales. So, the company must focus on global strategies regarding market development and acquisitions.
- The links with different governments across the globe have negative and positive aspects so, the company should focus on regulatory strategies that would protect the company from international tensions like the tension between China and the United States and the turmoil in Europe that possible trigger the economic downfall and affect the market of the company. The most income-generating market of the company is the non-US segment or block so the company needs to focus on the productive modifications of the marketing and business relations with the international blocks.
- The strong links of the company with Stakeholders including non-government and international agencies have a major role in its business diversification and help the company to achieve a sustainable business. Furthermore, these links can be most productive for the company to protect the corporate structure and market from political uncertainties and other international conflicts.
- The Carnival Cruise is the only largest vocational company in the industry of Hospitality, travel, and tourism that is included in the S&P 500 and FTSE 100 index in the United States and the UK. Furthermore, the company had a functional governance team that mainly focus on international relations with the stakeholders including both government (GOs) and non-government (NGOs) that enable the company to sustain its business and market strategically.
Economic Factors
The economic stability of the company is dependent on the economic factors that have a critical role in business development and the sustainability of economic health. The most influential part of the economic sustainability of the company is tourism so that is why the economic health of the company has a direct relation with the inflow of the tourism rate. The most critical economic factors and their effects that have significant roles in the company are as under:
1. Fuel prices
Fuel prices are influential economic factors that play a significant role in the business and the increase in fuel prices leads to a decrease in customer volume due to which the company fails to achieve its economic targets. So, the company must take certain measures that compensate for the economic stability and the company would be least affected.
2. Consumer Interest
The economic crisis across the globe reduced the economic growth of the companies in the tourism industry but Carnival Cruise successfully maintain its economic health because of its marketing strategies and loyalty-based customers. However, the increase in fuel prices of up to 70% probably affected the company but at that time a high volume of customer market refer to avail the services of the company due to which the company was not that much affected as compared to its rivals. Around 70% of vacationers are using the services of Carnival Cruise and local governments are investing in the infrastructure upgradation of the company so that is why the company has strong financial stability. The government of Panama and other countries has a huge interest and investment in the cruise ships that enable the company to generate huge revenue of around $5.856 billion......................
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