Carnival Corp. Introduces New Marketing Program

[SilvertoGold]

Absolutely. :D But, then again, I might start speculating about having a second one.

 

Absolutely!!

[Pia1913]

If one is good, two is better. It's wine time here right now. :)

[Hlitner]

And I think that's one of the reasons why Carnival has attracted no real interest at all. (Another is the segregation of the loyalty schemes to date.) It's been a very good strategy for staying under the radar. Keeping the schemes separate obviously reinforces the practical and effective competition between the brands of the group.

 

But if you institute a common loyalty scheme across the whole group, you don't need to get to 50% of the market to trigger competition concerns.

 

The Royal Caribbean / Celebrity model described by sppunk would be interesting: cross-scheme recognition of status but no cross-earning. That would take much of the sting out of commonality, as well as benefiting the customer as DaveOKC says.

 

My goodness, not sure what on earth you are talking about! CCL is simply another US Corporation that owns multiple cruise lines. The main regulations in the US (that apply to cruise lines) involve health and safety issues (Coast Guard Inspections, USPS Inspections and regulations, etc). There is also the PVSA (often called the Jones Act here on CC) which can prevent the cruising between US Ports.

 

But loyalty schemes, which are entirely free, have little basis for any kind of regulation. In fact, if regulators were to get involved in "loyalty schemes" the cruise lines could simply eliminate the programs. The EU has indeed implemented multiple rules and regulations that pertain to travel, and this is one reason why Europeans often find themselves paying higher prices for cruises then their North American counterparts.

 

The issue of cross-brand loyalty benefits is quite interesting. RCI has done if for several years, but does not allow the combining of credits from their various lines (they do give some reciprocity based on comparable levels). And the newest RCI re-alignment of loyalty benefits does not even give any comparable benefit to the highest levels (i.e. an Elite Plus on Celebrity will only get Diamond (not Diamond Plus) on RCI)).

 

While we can appreciate our cousins from across the big pond wanting government to interfere in every facet of life, there are still 1 or 2 folks left in the US that prefer less government :).

 

Hank

[Globaliser]

CCL is simply another US Corporation that owns multiple cruise lines. ...

 

But loyalty schemes, which are entirely free, have little basis for any kind of regulation. In fact, if regulators were to get involved in "loyalty schemes" the cruise lines could simply eliminate the programs. ...

 

...

 

While we can appreciate our cousins from across the big pond wanting government to interfere in every facet of life, there are still 1 or 2 folks left in the US that prefer less government :).

Well, Carnival technically isn't a US corporation at all. ;)

 

But the underlying issues surely aren't hard to understand?

1. Carnival controls a huge proportion of its market, much more than any hotel company, airline or even airline alliance.
2. The possible anti-competitive effects of this have long been a discussion point.
3. These aren't fanciful concerns, because they were much discussed at the time of the (then) Carnival / P&O Princess merger, although I can't now remember off the top of my head what was done to satisfy the competition regulators on both sides of the Atlantic.
4. The potential anti-competitive effects of loyalty schemes has long been recognised by regulators on both sides of the Atlantic, even when independent companies were joining together rather than common subsidiaries of a single company. The fact that they're "free" to the customer doesn't change these effects which are caused by the benefits which they offer.
5. One clear example of this was when American Airlines and British Airways mutually carved out cross-earning from what was otherwise a set of alliance-wide frequent schemes. (IIRC, US regulators were more concerned about this than UK regulators.)
6. Carnival's strategy so far has been to keep the loyalty schemes separate so that the brands continue to compete against each other in all respects.
7. If a Carnival-wide cross-brand loyalty scheme is now introduced, it will inevitably erode the competitive landscape to some extent.

Hence the question: I wonder whether this will now be the point at which the regulators sit up and take notice? Note that I have not asserted that this will be the point at which regulators will say no. But it's interesting to see how many people are certain that no issues are raised by this at all, despite the history of regulatory interest in the anti-competitive effects of loyalty schemes.

 

Now, Hank, I know that you're sophisticated enough to see the bigger picture in all of this, rather than just taking the "What's in it for me today?" approach. So in relation to "big government" - and leaving aside the fact that US regulators are also interested in these questions - think about this: Do you like what a laissez faire approach has done to the US airline industry, now that effective competition between airlines is a shadow of its former self? Do you think that a drastic reduction in choice has improved the passenger experience? Capitalism works well for the customer when suppliers vie with each other to do better, and reducing competition is very rarely good for the customer in the long term.

[OTOW guy]

just some more hype and all the speculation was for naught. All I can see is it promotes using twitter.