Segment transition within the Cruise Line Industry : From a perspective of Royal Caribbean International

A cruise, meaning a travel on a ship where one visit a number of places is a form of holiday alternative that has grown rapidly the last decade. Royal Caribbean International (RCI) is the largest actor on the Swedish market and is now changing its target market strategy. The company is transitioning its focus from the old traditional more affluent clientele, to target a wider span of customers where the people between 30 and 50 years of age are in focus and have become the main target group. Therefore activities aboard are added to suit these customers specifically. What the authors of this thesis want to find out by using both interviews and questionnaires is whether the general opinion about cruising is coherent with the message that Royal Caribbean International is trying to convey. The authors also want to know if the targeting efforts are optimal when trying to alter people’s mindset and attract a new type of younger customers. According to the performed survey, the brand awareness of RCI was best within the main target group. The most efficient media vehicle in communicating RCI’s brand has been brochures followed by newspapers and word of mouth. Somewhat surprisingly neither TV nor Internet was among top three of the most awareness creating media vehicles. Through these media vehicles RCI tries to convey that younger people are now more in focus. However, people older than 50 are the most positive towards going on a cruise themselves. At the same time the whole population seem to think that cruising is best suited for people older than 50. No matter how old the respondents to the questionnaire were they believed that cruising was better suited for people older than themselves. The population is getting older and the proportion of people over 50 years will increase dramatically compared to younger people within the next decades. Still RCI is focusing on adding activities and market themselves towards a younger group. Family behavior is changing and people tend to start a family later. RCI is therefore targeting families to a greater extent in order to attract the young but at the same time retain the older and proportionally growing customers groups. Cruise prices have decreased and RCI is now more than ever not only targeting more affluent people. It is supposed to be afforded by a wide span. Even so, people tend to think that cruising is better suited for high-income takers. At the same time it is widely associated with luxury, not affordability. Associations to cruising are overall positive but they are not necessarily exactly the ones that RCI is trying to communicate the most. Some perceptions are in line with the message RCI are trying to convey while others are based on the established prejudices that surrounds the cruise line industry and that are hard to erase. Even though people typically see cruising as something positive, they are still according to this study not to any great extent considering going on a cruise