Cunard Line Ltd Case

Key Concern: balancing strategic mkt.comm with immediate need Tactical

promotions, Cunard Image-Elegance and high recall vs increasing individual
returns of ships

Started : 1840,150 yrs. celebrated : 1990

Prior to international Jet travels: worldwide travel services-US, Europe Now

positioning : “luxury vacation business”
Cunard Lines

How many ships ?

SEVEN- 7
Five 5 Star Services: QE2(1850 pxs),Sagafjord & Vistafjord
( Ultra deluxe)(550 &750 pxs each),Sea Goddess I and Sea
Goddess 2(58 couples each)- [New York, Europe, Caribbean,
round the world trip each year]
Two in the premium(4-star) category-Cunard Countess and
Cunard Princess-Caribbean ports(Europe and Mediterranean)-
800 pxs
Cruise Industry- four million boarding per year,(10 ships)
luxury segment-8%->Cunard : 50% share
 Cunard Lines

Till 1990-occupancy : 90% , 65% full price

Post 1990-competition and Iraq war-> supply exceeded demand
discounting, price cuts and promotions
Overall mktg.commn budget $ 40 million-50% “strategic”-image & exclusivity
Current environment-> focus shifting to “tactical and individual liner promotion-
Question: Is it right: if so how much?
Eleanor Leslie-VP corp& mktg comm.-challenge: balancing the two-maintaining the
effectiveness, coordination and integration of mktg comm. efforts
Budgeting: Bottom up approach-task based
One innovation :Exhibit 11: “page plus column”- common corp theme on Cunard –with
details of relevant ship on a column in facing page
 Cunard Line Ltd

From individual ships to ‘type of cruise’-challenge for Leslie: maintaining

integration-Umbrella Branding (CUNARD) vs Individual ships
Four types: a) elegant 5 star cruising-the QE2, b)ultra deluxe cruising 5 star-
Sagafjord & Vistafjord, c)less formal, less expensive cruising( destination
focussed-4 star0 countess& princess, d) yatch like ( luxury cruising-5 star)-
Sea goddess I and Sea Goddess II
150 years-1990 Corporate Identity Manual
Revenues for Cunard: 60% -USA, 95% thr’ Travel Agents
DM:[25%, Mass media:35%(70% strategic,30% tactical-91-92: 50:50),
brochure & travel agent co-operative spending-30%,PR & Promo:5%]
TM luxury 5 star: 55 +( 3-5% top income), 4-Star:45-55 yrs( income:20-
25%, Psycho& demo: very well educated, married and heavy mag readers
Holland America lines: $ 1000 off-sale on all 4 star( Bermuda) and
Caribbean cruises; “I am selling $10,000 cars for $5,000”
 Questions
1. Because of prevailing mkt conditions should Cunard use a more”sales-
oriented” format emphasizing price for its tactical advertising?
2. If the situation were better-economic onditions-would yourjudgement
differ regarding the above?
3. Your recommendation on balancing Cunard Image Advt & image of
individual ships?
4. Which mktg.commn elements should treceive greater/lesser emphasis?
Why? What about the role of DM?
5. Implications of the ‘success of one day sale” for Cunard?
6. Effect of orgn.change on mkt.communications at Cunard
7. Prioritize and address the challenges facing Leslie?