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Norwegian Cruise Line - The Strategies that Make It So Successful

Updated on June 19, 2012

Written for the University of Dallas 'Senior Seminar' class in Spring 2012. Part II

Source
Norwegian Gem
Norwegian Gem | Source

Keeping an Eye on the Market

Environmental scanning is the surveillance of a firm’s external environment to predict environmental changes and detect changes already under way.[1] After the 2008 recession, cruise lines began to change a few things. During this period, the overall interest in refurbishing ships, offering shorter cruises, revolutionizing the dining experience, and tailoring to single passengers changed the entire cruising industry. Naturally, when one cruise line begins to implement a new strategy, others tend to follow suit and that’s one of the hazards of being innovative. For instance, when NCL launched its trademarked “Freestyle Cruising” in 2001, every other cruise line began implementing this idea of unregimented dining and no dress codes.[2] It has now become an industry-wide norm for the customer to be master of his own vacation, all thanks to NCL. Despite this threat of competitive intelligence, NCL has damned the torpedoes and charted a course full speed ahead!

Norwegian Dawn dry-dock
Norwegian Dawn dry-dock | Source

Refurbished Ships

Ships entering dry-dock for repairs have always been routine, but as of late, major renovations have also been undertaken in order to save on costs.[3] After all, making an old ship look new is much cheaper than putting in an order for a new multi-million dollar ship. The old ship is hardly recognizable as the layout and décor are extensively modified. As a matter of fact, NCL has just recently completed refurbishment of the Norwegian Dawn, adding staterooms, a new steakhouse, reconstructing a lounge, and laying down new carpets.[4] Waste not, want not. Refurbishments save millions of dollars and take place in a matter of months, thereby enabling cruise lines like NCL to jump right back into the game and quickly make a return on its new investment.

Source

Offered Weekend Trips

Although the industry diverted its attention to renovation in order to save money, budgets became tighter for the average traveler and therefore the cruise industry began to focus on shorter cruises. NCL, for example, began to change the perception of what it means to cruise with its weekend getaway deals. Never before had people considered taking a cruise for just a weekend or even one night.[5] NCL’s strategy was to lure consumers away from weekend getaways at Las Vegas or New York and offer them something much simpler on board one of their ships. Unpack once and let the crew do the rest. It is a sound strategy to do whatever it takes to get people on board a cruise just to give them a taste of what they could potentially do for a week, rather than just a weekend.

Revolutionized Dining Experience

No matter how long you are on a cruise, one of the most well known elements of cruising is dining. Interestingly enough, cruising is almost universally perceived as the time to satisfy all your gluttonous desires with endless buffets and fine dining. If this is the case, then why not have it your way? Back in the day, dining was very regimented and people couldn’t choose their meal times or who they could sit with. Although this regimentation is still a common misconception nowadays, NCL was in fact the first cruise line to pioneer the idea of freestyle dining.[6] This put the power of choice back into the hands of the passengers. For example, NCL retains the two main dining rooms and buffets, but also encourages its passengers to sample their numerous specialty restaurants. “Sit down to a four-course meal and a fine wine. Or grab a burger hot off the grill. Dress up. Dress down. Sit with your friends or make new ones. You'll find more dining options than days of your cruise, and you're free to enjoy them all on your own schedule.”[7] As this freedom to do whatever you want on board has become commonplace, more and more travelers are looking to cruise.

The awesome Norwegian Epic
The awesome Norwegian Epic | Source

Tailored Solo Accommodations

Accommodations for solo passengers are almost unheard of because cruises want every room fully utilized so that the ship is at full capacity. Achieving full capacity is difficult, especially in a poor economy, but nevertheless NCL is now attempting to cater to the single person. Normally, one would have to pay for double occupancy in order to have a stateroom all to himself. Some cruises offered these passengers discounts and some even offered programs to help “Find a Partner” in order to save on the bottom line.[8] However, the two biggest cruise lines, Carnival and Royal Caribbean, offered no special deals or solo staterooms, which left little NCL to pick up additional revenue. NCL began offering rooms specifically designed and priced for the solo traveler this year on their new ship, the Norwegian Epic.[9] The Studios are meant to sleep and shower passengers; that’s about it. The ‘Norwegian Exclusive’ here is referred to as “The Living Room” where exclusive access is granted only to solo travelers. Here, they can watch TV, enjoy a drink, and socialize with other singles. More details on this impressive strategy will be specified later.


Continues with Part III...

Works Cited

[1] Dess, Lumpkin, Eisner, McNamara, Strategic Management, Ch.2, pg. 41

[2] Cruise Mates, NCL Review

[3] Cruise Critic, Cruise Ship Refurbishments

[4] NCL, Norwegian Dawn Refurbishment

[5] NCL, One Nighter

[6] Sarna, Hannafin, Frommer’s Cruises and Ports of Call, Ch.6, pg. 192

[7] NCL, Freestyle Dining

[8] Cruise Critic, 10 Best Cruise Lines for Solo Passengers

[9] NCL, Staterooms: The Studio

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