Carnival corporation competitors

Introduction

For this paper, I shall focus on Carnival Corporation & plc, the world's largest multinational leisure travel company with its world headquarters in Miami, Florida. Carnival operates the largest portfolio of cruise brands in the United States, Australia, Asia, and Europe. Carnival cruise lines operate 105 cruise ships with 254,000 lower berths visiting over 700 ports offering customized cruise products, services, and vocational experiences to the world's most desirable destinations. Its ship lines include P&O cruises Australia, Swan Hellenic, Carnival cruise lines, P&O cruises, Ocean village, Cunard line, costa cruises, AIDA cruises, Windstar cruises, Seabourn cruise line, princess cruises, and Holland America Line. The corporation operates in over 100 countries and employs over 150,000 employees in its shoreside and shipboard operations, serving over its 13million customers. It looks forward to operating safely, legally, and with environmental protection in mind(Carnival Corporation & plc, 2020). This paper will look at a brief history of Carnival Corporation & plc, its competitors, industry position, recent developments in the industry, future directs, among other relevant elements.

A brief historical summary

Carnival Corporation & plc was established in 1972 by Ted Arison, the cruise industry pioneer, as Carnival Cruise Line. Carnival started with a singe secondhand ship and one-way fuel, but the enthusiasm of its proprietor, Arison, would change the company situation to become a legend in seafaring. Carnival experienced massive growth, and in 1987 the company had risen to become the world's largest popular cruise line. It was listed in the New Yolk stock exchange the same year, offering 20% of its common stock. This listing brought the much-needed capital for its expansion. In 1993, the company adopted its current name to distinguish it from its cruise line subsidiary. By the end of the 20th century, it has acquired six more cruise lines, including Cunard Line, Costa Cruises, Seabourn Cruise Line, Westours, Windsor Cruises, and Holland America Line (Yahoo, 2020). In 2003, it acquired P&O Princess Cruises plc though the new subsidiary would retain its name and the British shareholders. In 2007, Carnival sold off it's Windsor and Swan Hellenic Cruises. in 2015, China State Shipbuilding Corporation was formed from a joint venture between China Investment Corporation and Carnival Corporation. In 2018, the company invested in Japan's Port of Sasebo, which was due to open this year. Still, in June the same year, it acquired White Pass and Yukon Route railroad, port, and retail operations (Carnival Corporation & plc, 2020).

A list of competitors

Carnival faces major competition from other global cruise industry players, including MSC Cruises, Norwegian Cruise Line in the UK, and Royal Caribbean Cruises Limited(RCCL) in North America. These four companies serve more than 83% of global cruise guests. Carnivore has a market capitalization of 10.7 billion dollars, a Norwegian cruise line with a capitalization of 5 billion dollars, and Royal Caribbean International with a market cap of 8 billion dollars. Other competitors include Celebrity Cruises and Azmara Cruises in the United States. Carnival also competes with global land-based vacation alternatives like resorts, vacation ownership properties, casinos, organized tours, theme parks, and hotels. One such competitor is Walt Disney Co., which has over 180,000 employees and a revenue of 71,982 million dollars as of the last 12 months (CNNMoney.com, 2020).

The company's position within the industry

Carnival Corporation & plc core competencies include differentiation, partnership through joint ventures, mergers and acquisitions, and international strategy. Through its differentiation strategy, it looks to offer a wide range of holiday vacations for customers to choose from. It introduces new destinations regularly, apart from offering internet and other communication infrastructure, shopping malls, and other products on board. Carnival has 11 cruise brands, having different demographic appeals to accommodate all cultures. Carnival is a strong brand in the cruise industry, owning a whopping 56.63% of the market share, which it uses to expand its addressable markets. It also adopts special advertising techniques based on the value proposition. The company has also harnessed the acquisition, joint venture, and merger strategies to expand its geographical coverage, increase passenger capacity, provide better customer experiences, and strengthen the brand portfolio. All the partnerships have greatly added to its competitiveness. The corporation's size has helped it use the economies of scale to reduce costs and gain competitive advantage (Carnival Corporation & plc, 2019).

Through the above strategies, the Carnival has kept its leading market position for a long time. Its revenues have been strong, with 2019 recording revenue of 20.8 billion dollars, higher than the 18.9 billion dollars figure the previous year. It has been expanding and penetrating the market very fast, establishing new destinations every year. Carnival has more than double of the main competitor, Royal Caribbean, ships. It paid a dividend of 1.4 billion dollars in the last year's financial year, indicating its healthy financial performance. However, Carnival reported a decrease in total revenue by (84.7%) in its second quarter of the year 2020 compared to the average competitors' decrease rate (66.87%). it has also seen its cost of operations go up with as high as 16% last year, threatening its competitiveness (Yahoo, 2020)