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Disruptive Marketing Plan: American Cruise Lines
Lane
BUSI745-Marketing for Competitive Advantage
School of Business, Liberty University
October 11, 2020
Author Note
Lane
I have no known conflicts of interest to disclose.
Correspondence concerning this article should be addressed to Lakisha Lane
Email: ll[email protected]
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American Cruise Lines Disruptive Marketing Plan
Businesses operating in highly competitive industries and new businesses have to invest
resources in marketing to attract enough clients (Armstrong et al., 2014). Where normal
marketing is failing to yield desirable results, a business can resort to disruptive marketing. The
term disruptive marketing has several interpretations. One interpretation regards introducing a
new product or service in an untapped market (Gupta, 2016). Another interpretation regards
creating a new, convenient service or product for an existing market (Gupta, 2016).
The third meaning of disruptive marketing is adopting new and innovative marketing
strategies to market products, services, or brands (Hult & Ketchen, 2017). Disruptive marketing
has risks as an organization engages in previously untested activities to determine their
effectiveness in attracting customers. A United States brand that requires disruptive marketing to
grow its market share and expand its business is American Cruise Lines. The company provides
its customers with cruise tours. This plan aims to propose a disruptive marketing plan to be used
by American Cruise Lines to expand its market share.
Disruptive Brand Plan
American Cruise Lines is a private tour and travel company that provides its customers
with cruise tours in various destinations in and around the United States. Some of American
Cruise Lines' destinations are the Western and Eastern seaboards and Columbia-Snake and
Mississippi-Ohio river systems (American Cruise Lines, n.d.). The company currently owns and
operates 13 small cruise ships (American Cruise Lines, n.d.). American Cruise Lines provides its
cruise tour customers with tour experiences, food and beverages, and accommodation. One
criticism of the firm is that it has not grown significantly since its founding in 1991.
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Cruise tours are among the vacations of a lifetime, and they entice most holidaymakers
(Papathanassis, 2017). Despite the available market for cruise tours, American Cruise Lines has
not succeeded in attracting many customers for its services. The company owns and operates
state-of-the-art cruise ships and should easily attract many customers.
American Cruise Lines' marketing approach is partly to blame for its failure to attract
many customers. Disruptive marketing is necessary to grow the brand and attract many
customers to its products and services. The proposed disruptive marketing approach for
American Cruise Lines is to change customers' vacation experience by providing them with
amazing tourist destinations and experiences. Amazing tour destinations and experiences will
lead customers to come back for the same and share their experiences with family and friends.
The amazing tourist destinations and experiences will be marketed to Americans seeking a great
vacation. That will help grow American Cruise Lines market share and expand its cruise ships
fleet and travel destinations.
Marketing Mix
American Cruise Lines needs to make the right decisions regarding product, price, place,
and promotion elements of the 4Ps marketing framework. The firm has to adopt disruptive and
innovative strategies in handling the four areas of marketing decision to disrupt the United States
cruise tours market. Decisions adopted by American Cruise Lines regarding the 4Ps have not
borne great results regarding market penetration and the company's growth and development.
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Product
The main offerings that American Cruise Lines provides its customers are cruise tours in
the Columbia-Snake and Mississippi-Ohio river systems and around the Western and Eastern
seaboards. The service requires the firm to provide its customers with other services and
products. Another service that American Cruise Lines provides its customers is accommodation.
Customers have to eat and shower while on the cruise ships. Critical products that accompany
the main service are food and beverages. Holidaymakers desire delicious meals and beverages.
Disrupting the market will entail American Cruise Lines making significant changes to its
main service and accompanying services and products. The company has very limited tourist
destinations. American Cruise Lines has to include exciting tour destinations, for example, cover
the great Caribbean and South American travel destinations. The company also has to enhance
its accommodation service and foods and beverages to appeal to more customers.
Price
The price that a business charges for its products or services are critical to market
success. For example, if a firm charges prices that customers are unwilling to pay, the customers
are likely to switch to the firm's competitors if they charge low prices. American Cruise Lines
has been using the cost-plus pricing strategy for its services. The company works out the cost to
be incurred by each customer in a tour and adds a mark-up. The change that American Cruise
Lines has to make regarding the pricing element is to adopt competitive pricing for existing tour
destinations.
Competitive pricing regards charging customers based on what competitors charge
customers (Faith & Agwu, 2018). Competitive pricing help established firms compete with other
established firms. The company should adopt penetration pricing for the new tourist destinations
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to be added to American Cruise Lines’s service portfolio. Penetration pricing regards charging
less than competitors to penetrate a particular market (Faith & Agwu, 2018). American Cruise
Lines will revise the prices upwards once the company has a significant market share in the new
travel destinations.
Distribution (Place)
Customers enjoy the tour services offered by American Cruise Lines when transported to
different destinations in the firm's cruise ships. Before customers board the company's cruise
ships, they have to travel to the destinations where they are situated. If cruise ships are situated in
a location that is quite far away from potential customers, such customers are likely to seek a
nearby cruise company to enjoy a cruise tour. To maximize the number of customers that
American Cruise Lines accesses, the company has to situate its cruises to locations close to
potential customers. Situating cruise ships close to where many potential customers are situated
will help save customers on the cost of traveling to the cruise ships; thus, encourage many
potential customers to buy the firm's tour services.
The place where the company takes its customers is also critical to service enjoyment.
Customers need to be taken to exciting tourist destinations. Therefore, American Cruise Lines
has to work on identifying intriguing cruise tour destinations to take its customers. Taking
customers to exciting destinations will maximize their likelihood of returning for more such
exciting tours and recommending family, friends, and colleagues who seek cruise tours to
American Cruise Lines. Marketing, exciting tour destinations will also be easy.
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Promotion / Communications
The promotion element in the 4Ps of marketing concerns the marketing of a firm's
products, services, or brands. Methods of promoting products, services, or brands include
advertising, sales promotion, and public relations. To successfully penetrate the market, an
organization has to adopt the right marketing mix, communicate the right message, and use the
right marketing channels, among other things.
American Cruise Lines has relied heavily on traditional marketing means like newspaper
advertisement and radio advertisements to promote its tour packages to customers (American
Cruise Lines, n.d.). The firm has adopted digital marketing but has not been quite successful in
the same. The failure to succeed in digital marketing is due to ineffective digital marketing
strategies.
American Cruise Lines should continue engaging in traditional marketing as it has helped
attract many customers. The company should also adopt effective digital marketing means as
digital marketing is highly effective for tour companies. Sharing photos and videos of exciting
travel destinations on social media can aid attract many customers.
Market Segments - Current Target Market
The cruise line market is often segmented based on two characteristics. The two
characteristics are onboard lifestyle and overall vacation experience (Vogel Papathanassis, &
Wolber, 2012). The characteristics lead to four market segments. The segments are first-class
cruise lines, premium cruise lines, luxury cruise lines, and specialty cruise lines (Vogel et al.,
2012).
First-class cruise lines and premium cruise lines segments involve large and medium
ships, respectively, and customers get great onboard experience. However, first-class cruise lines
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provide a superior onboard lifestyle. American Cruise Lines serves customers in the luxury
cruise lines segment. Cruise ships in the segment are small and provide five to six-star service to
customers. American Cruise Lines maintains small ships, and customers enjoy luxurious
service.
New Primary and New Secondary Target Market
Two new market segment that American Cruise Lines can target are premium cruise lines
and first-class cruise lines. The two market segments offer the company access to many
customers and global travel destinations. More customers will provide American Cruise Lines
with increased revenue and profit.
New Primary Target Market
The new primary target market that the firm should focus on is premium cruise lines. The
particular segment requires investment in medium-sized cruise ships that can host 1500-2000
people and provide good accommodation (Vogel et al., 2012). Venturing into the segment will
allow the business to organize cruise tours involving 1500-2000 and visit destinations far away
from the United States as the ships are large enough to handle the same. The Premium cruise
lines segment is family-friendly, and the firm will attract families for its trip packages. Potential
customers with a spirit of adventure should be targeted.
New Secondary Target Market
The secondary target market that American Cruise Lines should seek to venture into is
the first-class cruise lines. To venture into the second target market, the firm has to invest in one
or several large cruise ships. Cruise ships in the particular market segment have a capacity of
2000-3500 people (Vogel et al., 2012). The cruise lines provide customers good food and
accommodation.
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The first-class cruise lines are family-friendly. The company will attract families that
seek to go on a cruise tour. The large ship sizes can allow the company to take customers to
travel destinations around the globe. The ships are large enough for around-the world-tours. The
large ship capacity and many travel destinations provide the firm with the opportunity to
generate huge income. Potential customers with a spirit of adventure should be targeted.
Demographic & Economic Trends
Analysis of cruise ship passengers shows that passengers often range between 30 and 80
(David Mc, 2015). A mixture of families and single people take cruise tours. Cruise line tour
passengers are predominantly Caucasian (David Mc, 2015). The passengers are often employed
full time and well-educated.
A recent trend in cruise tours is the increasing number of Millennials interested in taking
such tours (David Mc, 2015). Millennials are people born between 1980 and 1994. Members of
the generation are in the job market and take cruise line tours for vacation. Another trend is that
retired people like to take around-the-world tours as they have time for the same. The Caribbean
remains the most popular cruise tour destination.
The demographic and economic trends support the targeting of the premium cruise lines
and the first-class lines market segment. With target customers between the ages of 30 and 80,
the company requires medium-sized and large ships to take large numbers of cruise line tours
customers to travel destinations worldwide. Retired people like around-the-world tours which
require medium-sized or large ships. The targeting of the premium cruise lines and the first-class
lines market segments will provide American Cruise Lines with ships capable of taking retired
people worldwide and earn more money.
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Millennials, many of whom are highly interested in cruise line tours, can be attracted in
large numbers and taken to popular travel destinations in the Caribbean. American Cruise Lines
has to create tour packages that appeal to the generation. A large or medium-sized ship would
help take many Millennials to the travel destination and earn more money.
Analyzing the Consumer Market
Social Factors
A critical change in the cruise line market is the rise in the number of young people
interested in cruise tours (David Mc, 2015). Cruise tours have been stereotyped as for old people,
especially retired people. Millennials are now highly interested in the tours. There are also cruise
tours for children.
The change regarding the acceptability of cruise trips among people of different age
groups presents many customers for American Cruise Lines and other cruise line tours
companies to target. The firm that operates large and medium-sized ships can attract many
customers for a single trip and earn a lot. The change necessitates American Cruise Lines
venturing into the premium cruise lines and the first-class lines market segment.
Psychological Factors
A psychological factor that leads many people to be attracted to taking cruise tours is
adventurousness (Japutra & Hossain, 2020). Adventurousness regards the drive to try new
things, take risks, or gain new experience (Japutra & Hossain, 2020). Adventurous people are
more likely to take a cruise tour around the world or to a particular travel destination than
unadventurous people. A cruise tour provides opportunities to go on adventures. American
Cruise Lines should target people with such psychological disposition to attract many new
customers.
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Customer Needs
Some of the things that cruise line customers need are an amazing tour experience,
exciting tour destinations, great food and accommodation, and affordable charges for the service.
A firm that satisfies the key customer needs has a great chance of attracting many customers. To
disrupt the market, American Cruise Lines has to overachieve in the satisfaction of the critical
customer needs. The company has to ensure that customer experience while on the cruise ship is
amazing. The critical forms of entertainment that customers need should be provided.
American Cruise Lines should select amazing customer destinations, provide excellent
meals and accommodation, and charge competitive prices for the cruise tour services. The
satisfaction of the critical customer needs will likely lead to customers returning for so other
amazing tour experience and recommending the company to others. The satisfaction of customer
needs will likely result in the firm gaining a significant market share.
Positioning
Market positioning regards the ability to influence consumer perception (Camilleri,
2018). It involves establishing the identity or image of a brand in the minds of customers
(Camilleri, 2018). If consumers have a positive perception of a brand, they can be easily
persuaded to consume the brand or products or services associated with the brand. American
Cruise Lines need to position itself in the market effectively to disrupt the market.
One of the tactics used to position a brand in the market is to have a convincing
positioning statement. A positioning statement describes a brand or product or service and how it
satisfies customer needs. American Cruise Lines' new positioning statement is, “Since 1991,
American Cruise Lines has been taking our esteemed customers to amazing travel destinations
around the United States and the globe using our world-class cruise ships. We provide customers
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superior quality accommodation, meals, and customer service. American Cruise Lines provides
customers vacations of a lifetime.”
Competition
Criteria for
Comparison
American Cruise Lines
American Cruise Lines After
This New Disruptive Idea is
Launched
Competitor # 1 –
Royal Caribbean
International
Price - MSRP
Range
From $2015 per person
Competitive pricing
Depending on
destination
Product Unique
Attributes
Small ships. Destinations
are in and around the
United States
Small, medium, and large
ships. Destinations are in and
around the United States and
around the world
Large ships.
Destinations all around
the world
Placement –
points of
distribution
Western and Eastern
seaboards and
Columbia-Snake and
Mississippi-Ohio river
systems
New York, Miami, California,
Western and Eastern
seaboards and Columbia-
Snake and Mississippi-Ohio
river systems
Numerous departure
points including
Baltimore, Barcelona,
Brisbane, Miami, and
New Orleans
Promotion –
where / how do
they advertise
Radio, Newspapers, and
on the internet
Radio, newspaper, television,
internet
Television,
Newspapers, Billboards,
Internet
Ships capacity
300-800 people
300-3500 people
2000-3500 people
American Cruise Lines needs to make several changes to beat the competition. One
change is to invest in medium-sized and large cruise ships. Investment in such ships will enable
the firm to take customers to destinations worldwide and attract customers from around the
world.
Medium-sized and large cruise ships can transport thousands of customers to travel
destinations. Many customers can help lower the cost of operations, leading American Cruise
Lines to lower the fee charged per person for a tour. Another needed change is switching to a
competitive pricing strategy to beat the competition. The third proposed change is an
improvement in digital marketing as the competitors excel in the same.
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Market Research Plans
Market research is critical to understanding customer needs and preferences and
competitors (Burns, Bush, & Sinha, 2014). The market research that American Cruise Lines
would like to conduct for the particular idea is a market survey. A market survey involves
investigating the current state of a specific market and consumer needs and services (Burns et al.,
2014). The survey will help understand whether customers prefer cruise line tour destinations in
the United States or worldwide. The survey will also help learn whether many people like cruise
line tours, whether they have ever taken such a tour, and the amount they are willing to pay for
such a tour.
Consumers will be requested to provide feedback regarding their preferences regarding
cruise line tours. Customers who have taken cruise tours with other companies will be requested
to provide information regarding how much they paid for the same. The information will help
American Cruise Lines price its tour packages competitively.
The market survey will be conducted in key coastal cities in the United States. Some of
the key coastal cities where customers will be surveyed are New York, Miami, Los Angeles,
New Orleans, and San Diego. Consumers in such cities will be targeted because they are more
likely to have seen cruise ships there to pick or drop passengers and are likely to have an opinion
regarding cruise line tours compared to people who know little about cruise line tours.
The best time of year to conduct the survey is the beginning of December. December is a
holiday month in the United States, and many people are thinking about vacation during the
period. People will likely be in a mood to discuss tours and travel in the period. Information
regarding customer needs and preferences will help determine if investment in medium-sized and
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large cruise ships will help American Cruise Lines target many cruise line tour consumers in the
United States and worldwide.
Promotion Plans
The disruptive marketing idea needs to be marketed aggressively to increase the
likelihood of success. Metrics of success of the idea include American Cruise Lines procuring
medium-sized and large cruise ships, global travel destinations, number of customers, revenue,
and firm profitability. The metrics will apply in monitoring and evaluating the proposed plan.
Social Marketing
Social media marketing is a critical marketing channel for tours and travel companies.
Social media platforms offer firms the opportunity to share colorful pictures and videos with
their customers. The colorful pictures and videos can easily influence consumers to book a tour
with the firm. American Cruise Lines conducts social media marketing.
Social media platforms used by the firm are Facebook, Twitter, Instagram, and YouTube,
among others. American Cruise Lines does not often share exciting content on its social media
platform. A social media marketing strategy will be adopted to help the company reach more
customers through the platforms. The strategy will include plans on attracting many followers on
the platforms and attracting followers using exciting content. Superior quality content will be
shared consistently to ensure social media marketing success.
Public Relations
Public Relations is a cheap way for firms to gain “free” publicity. Publicity is critical to
attracting customers to a firm (Theaker, 2016). American Cruise Lines will use several means to
gain "free" publicity. One means is to write excellent press releases. When issues arise regarding
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the cruise line industry, the company will be endeavoring to write great press releases and
submitting them to leading television stations, radios, and print houses.
Another means to gain "free" publicity is to organize and engage in corporate social
responsibility activities. Fundraising for critical causes like fighting cancer and promoting green
energy will likely provide American Cruise Lines “free” publicity. The third means that
American Cruise Lines will use to gain “free” publicity is to get awards. Getting top honors in
the industry provides a firm and its executive crucial media coverage. Publicity will help
increase awareness regarding the brand and its services.
Traditional Marketing
Traditional marketing has been critical to American Cruise Lines' success. The marketing
approach has helped the firm attract most customers that it currently serves and gain significant
revenue from the customers. American Cruise Lines will continue to engage in traditional
marketing to gain more customers and retain existing customers. The means of traditional
marketing that American Cruise Lines often uses are radio and newspaper advertisements.
The company will enhance its radio and newspaper advertisements to appeal to more
customers. The firm will also increase its use of television and billboard advertisements to reach
more customers. Television and billboard advertisements will provide the company with more
extensive coverage and increase its market share.
Financial Viability of Plan
Some aspects of the plan require a significant amount of resources to implement. The
elements of the plan are procuring a medium-sized and large cruise ship. Such ships cost around
$500 million. The ships will help American Cruise Lines’s disrupt the United States cruise line
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market. However, the procuring of the two types of ships is viable, given a decade to do the
same.
Cruise ships take time to build and deliver. Selling two small cruise ships can enable
American Cruise Lines to acquire a medium-sized cruise ship with the money gained from the
sale. With around ten years, American Cruise Lines can comfortably finance the development of
a large cruise ship. The marketing aspects of the plan are cheap and, thus, easy to implement.
The firm can easily finance proposed social media, public relations, and traditional marketing
activities.
Relationship Marketing
Relationship marketing is critical to American Cruise Lines' success. Many cruise line
tour customers take such tours because of recommendations from previous customers of the
tours. Maintaining good relations with customers will help American Cruise Lines get referrals
from existing customers. Good relations will also help existing customers make repeat purchases.
One key way to develop a great relationship with customers is to provide them excellent
customer service. American Cruise Lines’s customers must be trained to serve customers
respectfully and conveniently. Customers must be happy with the firm’s services. Two other
keyways are to take customers to exciting travel destinations and providing a great tour
experience. The three recommendations will aid build great relationships with customers.
Socially Responsible Marketing
The term "socially responsible marketing" is used to describe a marketing philosophy
whose main concern is to ensure that firms consider the best interest of society in their marketing
endeavors and operations (Fodness, 2015). American Cruise Lines is keen on taking an interest
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in society's best interest in its marketing. One problem facing society is the pollution of the ocean
through the dumping of waste. The firm conducts its business around oceans and rivers.
The company is keen on environmental conservation. American Cruise Lines will be
raising customers' consciousness regarding conserving our water bodies when marketing its
services to customers. The incorporation of environmental issues in the firm’s marketing
qualifies and socially responsible marketing.
Christian Integration for Brand
An organization founded by Christians must adhere to the Christianity teachings and values
if the founders have to be consistent with Christianity. 1 Samuel 12:24 states, "Only fear the Lord
and serve him faithfully with all your heart. For consider what great things he has done for you."
Christians founded American Cruise Lines. The founders fear and serve the Lord and endeavor to
run a consistent business with their religious beliefs.
There are several things that the firm can do to make a Christian brand. One thing is to
adopt business ethics that are in line with Christian values. Such ethics will ensure that Christian
values will guide the firm's employees in their day-to-day operations. Another thing that American
Cruise Lines can do to make a Christian brand is to engage in operations in line with Christianity
teachings. The company should not provide services and products that are contrary to Christianity.
The two recommendations will promote American Cruise Lines as one of the leading
Christian brands. The recommendations will also ensure that Christian customers do not go against
Christian values while on cruise tours, and the firm owners do not compromise their religious value
for profit. Adhering to Christian values while doing business will also help further the gospel of
God here on earth.
Recommendations
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There are several actions that American Cruise Lines will have to take to implement the
disruptive marketing plan. One action is to work towards venturing into the premium cruise lines
and first-class cruise lines market segments. To venture into the two segments, the company will
need at least one medium-sized cruise ship and at least one large cruise ship. The company can
acquire a medium-sized ship by selling two small-sized cruise ships and using the money to
invest. American Cruise Lines can easily finance the construction of a large cruise ship within
ten years. The two types of cruise ships will enable the firm to reach destinations worldwide and
expand its target market.
The second action that American Cruise Lines should take is to enhance its marketing
activities. American Cruise Lines needs to enhance its social media marketing approach by
developing an effective social media marketing strategy and sharing exciting content. Social
media is cheap, and it can be quite effective for a tour and travel company. American Cruise
Lines should also enhance traditional marketing efforts by incorporating television and billboard
advertisements into its traditional marketing channels. American Cruise Lines should enhance its
relationship marketing efforts by providing customers excellent service, taking customers to
amazing tour destinations, and ensuring customers have a great experience while on the
company's cruise ships.
American Cruise Lines should also engage in socially responsible marketing. The
company should inform consumers about the importance of conserving water bodies. Measures
should be implemented to ensure that its consumers do not litter oceans and rivers while going
for cruise line tours. The marketing recommendations will help the firm penetrate the market
effectively. Effective market penetration will help grow and develop the company to become one
of the world's leading cruise line tour companies.
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Conclusion
In summary, American Cruise Lines is a cruise tour company that owns and operates
small cruise ships. The small cruise ships serve between 300-800 people. One recommendation
for market disruption is venturing into the premium cruise lines and first-class cruise lines
market segments. Venturing into the two market segments will require the company to acquire at
least one medium-sized cruise ship and at least one large cruise ship. The two kinds of ships will
enable the firm to take customers to numerous travel destinations worldwide and earn a lot from
the same.
Another recommendation to aid in disrupting the market is to enhance the company's
marketing strategy and activities. American Cruise Lines should adopt a social media marketing
strategy and implement the same effectively. The firms should also enhance public relations,
traditional marketing, socially responsible marketing, and relationship marketing. Enhancement
in the firm’s marketing operations will help improve marketing success and attract many more
clients. American Cruise Lines should uphold Christian values in its operations.
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