Carnival Cruise Lines and Crisis Control

Carnival Cruise Lines is a British-American owned cruise line based in Florida, U.S.A. The company has the largest fleet in the cruise line industry, with 24 vessels currently in operation that account for 21.1 per cent of the worldwide market share reported by Carnival.com. Originally an independent company founded in 1972 by Ted Arison, the company is now one of 10 cruise ship brands owned and operated by Carnival Corporation and Plc.

Carnival Cruise line is familiar with crisis control as they lost a ship Jan. 13, 2012. The Costa Concordia sank off the coast of Isola del Giglio, Tuscany, Italy in the Mediterranean Sea because the vessel struck a reef while deviating from its planned course. Of the 4,252 passengers on board, 32 lost their lives. They also had thousands of guests adrift at sea and another vessel temporary shutdown by the Centre for Disease Control.

Costa Concordia, owned and operated by Carnival, was one of the largest ships ever to be abandoned. Captain Schettino was arrested on preliminary charges of manslaughter in connection with causing a shipwreck, failing to assist passengers, and failing to be the last to leave the wreck, as he abandoned the ship with his crew. He was also later charged with failing to describe to maritime authorities the scope of the disaster, and abandoning incapacitated passengers. The company originally opted to pay for his legal fees but after realizing the magnitude of his charges they revoked his offer, as he is being tried as a criminal. Schettino faces over 20 years in jail for his charges.

Costa Cruises offered compensation to passengers, giving roughly 11,000 Euros to each passenger, as a payment for damages and the value of the original price of the cruise. One-third of the passengers took this offer, and the rest filed a class action lawsuit.

The ship left to float in the sea off the coast was an immediate worry for ecological disaster as the shipwreck was partially submerged. It would eventually slip deeper into the water and was still full of oil. This crisis was averted because plans were made to safely extract the ship by March 24, 2012. The company that insured the magazine declared the ship “a constructive total loss.” Stripping this ship for parts is one of the largest operations of its kind. The operation began on Sept. 16, 2013. Carnival averted a crisis by acting quickly to hire a salvage firm to create a plan to protect the natural environment and to safely get the ship out of the popular tourist destination.

Carnival Cruise lines started its disaster control immediately and was quite effective in sharing information with the media and helping with the displaced tourists who were aboard the ship. They offered the payout to passengers within the first month after the shipwreck and paid for passengers to stay in Italy until they were able to fly to their respective homes. Faced with a PR nightmare, carnival acted quickly and was able to save some company face with the public.

This year, Carnival Cruise Lines suffered several more setbacks as one ship was given a failing grade by the CDC and Health Department. Furthermore, another ship, the Carnival Triumph, experienced a fire in their engine room that left them powerless and adrift at sea. The ship had over 4,000 passengers and crew aboard when the fire started. The fire was immediately extinguished from the automated system but left the ship without power. The ship was towed to Alabama by local tugboats. Passengers aboard were given a full refund for travel expenses and the cost of the tickets, a credit for future cruises, and a cheque for damages of only $500. This ship was given an overhaul and is back in the cruise line’s fleet.

Carnival was able to save face throughout all these incidents. They shared all information with the media by setting up direct lines and contacts with the company, and since the Concordia disaster, Carnival has kept its passengers at the forefront of their mind, always giving compensation to those affected by the incidents. After the Costa Concordia disaster, the cruise line industry has been in the media spotlight, the shipwreck being one of the most televised issues in 2012.

Carnival ran several deals this year for its trips, ranging from as low as $49 per night to its regular price range of $1,000+. This proved successful with the maiden voyage of the Carnival Triumph, being completely sold out only four months after thousands of passengers were left stranded at sea, and its renovations and upgrades.

Reports from Harris Interactive poll indicates that consumers’ perceptions were completely changed from after the Costa Concordia and Triumph incidents. The latest polls show their quality scores have declined by 28 per cent. Carnival has taken the biggest hit from all existing cruise lines, because most cruise-related incidents in the last few years have all been with Carnival Cruise ships.

The cruise line has taken a hit in its popularity in recent years because of the incidents of Carnival ships. However, the company took many measures to retain clients by renovating its ships and announcing the plans to build the largest ship in their fleet. Carnival has implemented new deals all year to gain early-bird buyers and individuals who wouldn’t normally take cruises.

Read more: Four Months After the ‘Poop Cruise,’ the Carnival ‘Triumph’ Sails Again — and Is Sold Out | TIME.comhttp://business.time.com/2013/06/14/four-months-after-the-poop-cruise-the-carnival-triumph-sails-again-and-is-sold-out/#ixzz2mKvdWcIZ

James Birchall

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Are you a frequent-flyer? Add joining an airline loyalty program to the to-do list.

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Studies conducted by Aimia Inc., the owner of Aeroplan rewards and most loyalty programs in Canada, in 2012 showed that approximately 2.3 million rewards were issued to members, roughly a point per 14 seconds, including more than 1.6 million flights on Air Canada and Star Alliance carriers. They offer domestic travel and more than 1,000 destinations worldwide. In addition to flights, the 4.6 million active members also have access to redeem points for merchandise, hotel stays, and car rentals. All merchandise can be redeemed online at Aeroplan.com and items range from clothing to gift cards for Air Canada travel for others. Because Aeroplan is the oldest frequent-flyer program in Canada, they have several partnerships with financial institutions and credit cards where patrons receive points from purchases, such as Toronto Dominion banks, Scotia Bank, and Bank of Montreal. Porter, on the other hand, has not yet set up any partnerships with banks or other companies. While also flying with Star Alliance, Aeroplan members are able to redeem their points for seat upgrades or pre-boarding abilities. Within their loyalty program, there are different tiers of members who have traveled further than 25 kilometers, 35 kilometers, 50 kilometers, and 100 kilometers.

VIPorter, owned by Porter Airlines, competes against Aeroplan’s reward program. VIPorter is marketed towards clients as a faster and more convenient as it automatically starts accumulating points after five flights and your points expire only after four absent years of flying with Porter. VIPorter’s target audience is anyone who travels via plane, as it is directed towards creating a more luxurious, comfortable traveling experience with remarkable yet simplistic perks. Aeroplan’s target audience are business professionals and constant travelers, due to the complex nature of their rewards program, the expiry dates, and the loops one must jump through in order to sign up.

VIPorter is spoken about from the moment you enter the Porter lounge pre-boarding to the moment you land at your final destination to spark an interest in knowing more about the program. Porter hopes that the ease and experience of flying with Porter will drive clients to use the VIPorter program more often, in spite of the fact that individuals are automatically a member after their first flight. Their strategy has proven successful as Porter has opened more terminals throughout Canada and the United States faster than originally proposed in their expansion plans. One major differential between Porter and other airlines is Porter only offers one class; one that emulates first class, whether it is the private lounges, leg room between seats, or food. Therefore, VIPorter points cannot be redeemed for merchandise or upgrading seats, but can be put towards future flights. Porter chose to create their airline in this fashion because they believe individuals should be offered the same traveling experience, no matter what their situation.

Both Aeroplan and VIPorter are effective in promoting their programs while remaining free to use. Travelers with these companies should definitely take advantage of what they have to offer due to their inexpensive nature, and their ability to make traveling a more enjoyable experience.

James Birchall