Introduction
According to Oceania Cruises (2014), Oceania Cruises was established in 2002, and now it is the globe’s major high quality cruise-line in terms of classy, chic, and distinctive services; in addition, being the leader in destination cruising, the company travels in exceptional routes giving a fully enhanced touring-experience with the help of comfortable settings that provide unparalleled fashion and console. It is highly essential to state that currently Norwegian Cruise Line Holdings is the parent company of Oceania Cruises, as it has acquired Prestige Cruise Holdings (the former parent corporation of Oceania) in September 2014, making Oceania one of its leading subsidiary businesses, and strengthening the combined propensities and capacities to offer people the best possible services. The purpose of this paper is to discuss historical development, market segmentation strategy, competition, market penetration, destination development, onboard cruise operations, departmental management, and customer service of Oceania Cruises.
Historical development
Oceania Cruises (2012) noted that in 2002, Oceania Cruises started its journey and formed a fully innovative part of tour with stylish ships, lavish routes, comfy-accommodations, first-class food, and outstanding tailored-services, and today, it travels above 330 docks throughout the world on five triumphant ships that give people the chance to take pleasure in a cherished, sophisticated, and graceful touring-experience. Oceania Cruises (2012) further added that Bob Binder, Joe Watters, and Frank Del Rio established the company in January 2003 in Miami through contract with French government, and they bought three 684-traveller R-class-ships, which were made for obsolete Renaissance-Cruise-Line; the company’s vision was to convey top rated food, appealing country-club atmosphere, and victorious journeys to the most tempting places.
Oceania Cruises (2012) noted that within a short time, the company’s growth projections exceeded, and this was reflected through the fact that from just fourteen million US dollars capital in 2003, the company was able to gather about $850 million in February 2007; in addition, in April 2007, it contracted with Italy’s Fincantieri for constructing two novel 1250-passenger ships. It is suggested that in December 2007, it was decided that it would purchase Regent-Seven-Seas-Cruises from Carlson; moreover, the company in June 2010 declared a multi-million dollar plan to update three of its ships; however, it built and launched a new ship in February 2011, called Oceania-Cruises Marina, whereas in May 2012 it extended its cooking enhancement program. However, for a better understanding of the chronological development of Oceania Cruises, the table below provides a quick glimpse of the key developments that occurred each year since the company was first launched:
Table 1: Historical development of Oceania Cruises. Source: Oceania Cruises (2012).
Market segmentation
It is highly essential for any business to profoundly consider its market segmentation strategy in order to target the correct customer base successfully and fully capture the particular prospective market with complete capacity (Dereskey, 2008). It is widely accepted that the market segmentation strategy of most cruise liners almost always focus on geographic segmentation, customer group segmentation, and cultural segmentation, as these are the only relevant form of segmentation strategies for them. Oceania Cruises has segmented its market focusing on geographic and customer group segmentation; it is notable that the company has focused only to set its tours at particular geographic locations, keeping in mind the demands of the customers in those particular places; this means that the company looks forward to satisfying and serving the customers base of certain geographic segments. It has been noted that the key geographic segments of the company have been designed precisely, which has been greatly reflected in the touring destinations of the company; for example, it includes Northern Europe, Scandinavia, South Pacific, South America, Greek Isles, Eastern-Mediterranean, Australia, Asia, Caribbean, Panama-Canal, Transoceanic Tours, Alaska, Canada, New-England, Grand-Tours, Global Cruises, and Western Mediterranean.
Moreover, it is also required for Oceania Cruises to segment its customer groups properly in order to react to market needs aptly. According to CLIA (2011), among the citizens of the USA, seventy three million people possess prior cruising experience and thirty six million (who belong to the main target segment that is, those who are above the age of twenty-five and have an earning of above 40,000 dollars) of 133 million, expressed the possibility that they have possibility to trip again. These groups of people form the customer segments of the company and in most of the cases, as it has been indicated, these people have high-income levels and financial capabilities; therefore, during the customer group segmentation, Oceania Cruises has targeted the higher income earners.
Competition
Oceania Cruises has to compete with both direct and indirect upper-premium cruise lines; in addition, presence of intense competition in local market could affect on the return on investment. Main competitors in local market includes Avalon Waterways, American Cruise Lines, Carnival Cruise Lines, Celebration Cruise Line, Paul Gauguin Cruises, Quark Expeditions, Regent Seven Seas Cruises, Royal Caribbean International, Seabourn Cruise Line, Viking Cruises and so on; however, the following table gives more information about competitors of this company:
Table 2: Direct and indirect competitors of Oceania Cruises. Source: Self generated.
Market Penetration
Johnson, Seholes & Whittington (2008) and Thompson, & Strickland (2008) stated that market penetration is an effective approach when any company operates business in existing markets more deeply with existing products; however, Oceania Cruises sails to more than 330 ports all over the world and it has opportunity to penetrate more intensely into an existing customer base without conducting any internal modification. At the same time, management team and decision makers of Oceania Cruises need to concentrate on the key challenges to operate business in the existing market, such as, customer satisfaction rate in the present destination, competition in existing market, threats of new entrants, financial position of the target customers, return on investment, and so on.
Destination development
Destination development would be suitable step for sophisticated travelers while it would decide to sail in a new port with present product line; however, Oceania Cruises is a market leader of upper-premium cruise lines for which it has strong brand image to the customers. In addition, sophisticated travelers are looking for the best service and Oceania Cruises focus on cuisine, comfort, service, and outstanding value to attract the customers, who like to enjoy the best cuisine at sea, warm and personalized service along with a destination experience. Here, it is mentioned that destination development is one of the main strategy of this cruise line; at the same time, Norwegian Cruise Line Holdings Limited is a diversified cruise operator and it is now parent company Oceania Cruises. Chrusciel (2014) stated that this company had already selected 12 new destinations as part of its destination development project; however, following tables provide more information in this regard:
Table 3: New destinations Oceania Cruises. Source: self generated from Chrusciel (2014).
Table 4: Destinations by ship. Source: self generated from Chrusciel (2014).
Onboard cruise operations (organization, departmental management, and customer service)
According to Oceania Cruises (2013), the onboard cruise operation organization, departmental management, and customer service of the company is highly efficient as the company affords the most top quality customer services through effective organization of tasks and schedules and apt administration of its departments. This has been reflected through the fact that the company is growing enormously since its formation in 2002, in terms of assets, properties, market share, and net profit. Such success indicators provide the idea that the company is attending an increasingly larger group of customers in recent years, and the customers are returning to the company for spending further cruise vacation again and again after being satisfied with the customer service, operation organization, and departmental management when they toured with Oceania Cruises for the first time. However, a detailed discussion of the onboard cruise operation organization, departmental administration, and customer service of the business has been provided in the table below:
Table 5: Customer service and operations management onboard. Source: Oceania Cruises (2013)
Departmental Management
President and COO of Prestige Cruise, Kunal is responsible for every matter to make sure successful operation of Oceania Cruises; however, Kunal has long experience to serve as a CFO for Prestige, which helps the company to ensure well corporate governance for the future development. The Senior Vice President Sherman supervises revenue management for Oceania Cruises; Executive Vice President ‘Michael Flesch’ is responsible for all issues related with shipboard operations, for instance, controls hotel, food & beverage, entertainment and onboard revenue; moreover, he has duty to scrutinize Oceania’s continuous development program to offer products with unparalleled quality and ensure continual enhancement of the guest scheme. President, The Senior Vice President and Executive Vice President are responsible for increasing value for its shareholders, develop operational strategies and implement business expansion plan; in addition, they are concentrating on the internal an external threats, such as, skills development of the crews, adaptation of new technology, avoid unusual accidents and so on. Andrew Stuart holds different position in Oceania Cruises; however, he is accountable for International sales, exceptional value, and quality for guests; in addition, he serves the company to develop and strengthen its relationships with travel agents, investment in long-term travel partner success and brand positioning of the company.
Conclusion
From the above discussion, it can be argued that Oceania Cruises is a market leader of upper-premium cruise lines, which has operated business with five large ships and sailed to about 330 ports around the world. It has opportunity to expand business in the destination with existing products and it has scope to apply new market penetration strategy to increase number of travelers from the new destination.
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