Cunard Line Ltd. is a cruise line that represents luxury and class providing four to five star cruise ship options. Their overall target market is mature adults with mid to very high income-levels. A lot of the marketing efforts put forth by Cunard were going towards tactical efforts and the promotion of individual ships as opposed to the promotion of the entire brand. Although most of the ads portrayed the same look and had an individually tailored paragraph and/or photo.
Set backs caused by the worldwide recession as well as the Iraq War has caused Cunard the dilemma of risking their prestigious company image to provide consumers with larger discounts or develop other marketing strategies that will seek to maintain their 90% occupancy rate without lowering their high quality position. It created more pressure for the creation of “sales oriented” marketing, which would jeopardize their high-class image. With competitors such as Carnival who are able to provide large discounts, it makes it difficult for Cunard to avoid using the same approach in order to compete.
Segmentation Strategy Cunard seems to have taken a Concentrated Marketing approach to segmentation. Generally, they focus on one target market – the upper class. Although this can be seen as a disadvantage in an economy experiencing a recession, by segmenting based on this niche income and lifestyle, Cunard is able to tailor their services specifically to them rather than targeting more than one market and not providing the best service possible. Not only do their advertisements and brand perception demonstrate this segmentation but they make efforts to communicate personally with their clients.
This is demonstrated through through letters that they send with personalized marketing messages, tailored specifically to the needs of their customers. Price/Quality Relationship The concept of price/quality relationship is heavily integrated into the target market that Cunard has chosen. Along with their brand image, the high price of their services gives off a perceived high quality. Although services are generally intangible, services such as providing reservations for an entire mealtime in their five-star cruise ship is merely one example of how Cunard tries to maintain this price/quality relationship.
With the price that consumers pay, they come to expect the best service for their dollar. Generally those who pay these high amounts believe that money is no object as long as they receive a great quality product or service. Satisfaction would mean that they reached or exceeded the expectations consumers had of the service. Cunard tries not to portray prices in their advertising or have constantly advertised sales in order to keep the price/quality relationship high and retain customers who respect this aspect of their company. Alternative Strategies
There are multiple strategies that Cunard may take in order to maintain their high-class brand image while bringing in enough consumers from their target market. One of these alternatives is to create relationships with big companies and provide them with a vacation package deal. An example of this is creating a relationship with a large insurance company who is then able to create a contest for self-employed insurance advisors. As self-employed individuals they have the potential of gaining high incomes and through a contest they will be motivated to meet certain productivity requirements.
Only those who qualify will be able to go on the trip and will therefore meet the high standards of the Cunard brand. This method would probably be more effective for the four star ships who cater less to those at or near the retired age and target a little bit of a lower income than the five star ships. Another alternative strategy would be to create a loyalty program for existing Cunard customers. This method can be used for customers of the four or five star ships.
This loyalty program would provide occasional direct offers to customers who already have experience with Cunard and therefore will not view the deals as a lowering of standards. An example of a deal that can be provided is a selling package that is good for a year or two. This package would outline a discounted price for a set amount of people to travel on a certain cruise ship. That way, there is enough time for a customer to realistically plan out a trip while providing an incentive for them and encourage more action as opposed to a regular priced ad.
Lastly, an alternative that can be taken is to build relationships with various large companies with employees who make an income in the target range and make offers to company executives. This method would not downplay the company image because Cunard would be communicating directly with high-income executives and furthermore will not be making any public sales or advertisements. This method would create new potential customers who are directly in the target market of choice using the method of relationship building. This may also result in additional customer retention.
This method can be used for both the four and five star ships. In order to attract the target market of the five star ships, Cunard can make an arrangement with a company to offer a deal with their luxury ships as part of a retirement plan. Recommendations As a general recommendation, Cunard should focus on brand loyalty and relationships. Marketing efforts should go towards the advertising of the overall brand rather than individual ships while the rest of the company’s efforts should go towards relationship building.
These relationships will then in turn target certain customers to certain ships through Cunard’s arrangements with companies. Considering the situation regarding the recession and war, Cunard should focus heavily on the strategy of building relationships with companies who can create vacation contest packages for their employees. During the time of a recession, anyone would appreciate an incentive to make more money and the opportunity to gain something from it.
By winning something so prestigious, consumers gain confidence as well as social benefits, which can initially be their motivation. If it is a large company, there is potential for many qualifiers who can turn into loyal customers whether it be through the continuation of the contest yearly, or by their own personal desire to continue their relationship with Cunard. These contests will not jeopardize the high-quality image of the company because through negotiation, Cunard can insure that the qualification requirements are at a level where when achieved, it will be viewed as prestigious.
If this contest continues yearly, Cunard can maintain their customer value, satisfaction and trust and therefore have customer retention. This will result in less price sensitivity, positive word of mouth, returning customers and a long lasting relationship. If Cunard continues to use marketing to market their entire company while bringing their services directly to their desired market, they can ensure a 90% occupancy and the continuation of a high-class cruise ship operation.
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Topic: Cunard Line, Ltd
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