Ship Ahoy: a History of Maritime Passenger Industry Marketing
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CHARM 2011 Proceedings Ship Ahoy: A History of Maritime Passenger Industry Marketing Blaine J. Branchik School of Business, Quinnipiac University, Hamden, Connecticut, USA 22 Abstract Purpose – The purpose of this paper is to periodize the history of the marketing of the maritime passenger industry, a unique industry that has thrived for over 150 years despite dramatic technological and social changes. Methodology/approach – This study adapts Hollander et.al’s (2005) approach and incorporates secondary data from a variety of expert works and government data as well as primary data such as fare lists, advertisements, and promotional materials. Findings - This study finds that the industry’s marketing history can be divided into six periods: (1) Immigration (mid-19 th century to 1914); (2) World War I (1914-1918); (3) Tourism, alcohol and luxury travel (1918 to 1939); (4) World War II (1939 to 1945); (5) Jet age emergence (1945 to 1970); and (6) Cruising for all (1970 to the present day). Increasing focus on small niche markets, operational efficiencies, and mass-consumed luxury are trends for the future. Implications/limitations – This study provides practitioners and academicians insights into how an industry can completely reinvent all elements of its marketing strategy in response to changing social and technological forces. Space constraints limit the information mostly to British, American, and German shipping lines. Originality/value – Although much has been written about maritime history, no known work has examined the history of the marketing of the maritime passenger industry. Keywords – Cruise industry marketing, maritime marketing, industry marketing history, marketing history, shipping marketing Paper type – Research paper Introduction In 2009, 13,442,000 passengers sailed on passenger ships worldwide, the result of an annual average growth rate of 7.2 percent over the past twenty years (CLIA, 2010, p. 3). Seventy-five percent of those passengers were North American (Ibid., p. 9). One hundred ninety-eight ships from 24 passenger shipping lines (Ibid, p. 12) cruised around 24 regions, including the most popular cruise destinations, the Caribbean Islands. Other popular itineraries included Mediterranean, Alaskan, Scandinavian, and around the world cruises. In an era when jet travel has obviated the need for marine passenger travel, the industry has managed not only to survive but also to thrive via a combination of careful targeting and creation of desired marketing mix elements. Today’s cruise industry can be traced to the beginning of regularly scheduled transatlantic travel in 1840. Before that time, people sailed the seas, crossed oceans, and discovered new worlds. But it was not until Canadian Samuel Cunard formed the British and North American Royal Mail Steam Packet Company that regularly scheduled passenger sailings began (Dickinson and Vladimir, 2007; Maxtone- Graham, 1972). Cunard was the only bidder on a contract with the Royal Post Office to carry mail back and forth between Great Britain and the U.S. and Canada. The first regularly scheduled sailing was on the Britannia , sailing from Liverpool to Halifax and Boston and carrying 115 passengers. It arrived in Boston on July 4, 1840 (Maxtone-Graham, 1972, p. 5). Regularly scheduled service grew from there such that by 1907, the peak year of immigration into the U.S., scheduled maritime passenger service had transported 21 million immigrants sailing primarily from Europe to the U.S., along with all other passengers (Ibid., p. 155). Those 21 million as well as today’s 13.4 million were and are served by businesses creating marketing strategies to meet travelers’ evolving needs while maximizing profits. Methodology This paper presents a periodization of the marketing of maritime passenger service. It uses a four-step Ship Ahoy: A adaptation of an existing framework (Hollander et al., 2005), periodizing the segment’s history into six History of phases: (1) Immigration (mid-19 th century to 1914); (2) World War I (1914-1918); (3) Tourism and Maritime luxury travel (1918 to 1939); (4) World War II (1939 to 1945); (5) Jet age emergence (1945 to 1970); Passenger and (6) Cruising for all (1970 to the present day) (see Exhibit 1.). Industry This method first undertakes a historical chronology of the industry of interest – in this case the Marketing maritime passenger industry – with special focus on factors that may hold implications for marketers (such as demographics, government programs, wars). Within that chronology, the researcher looks for important, revolutionary events or turning points (Hollander et al., 2005) that had specific and 23 profound impacts on the industry. Using those turning points, the history is then divided into phases or periods with the key events/eras as bookend s for each period. The researcher then summarizes buyers’ activities and needs associated with those periods. These buyer segments form the sellers’ target markets. Finally, the researcher presents examples of marketing mix elements illustrating the service targeting. Both primary and secondary sources provided input for this paper. Secondary sources including maritime histories and travelogues provided substantial background on the industry and targets. Industry Association reports and data provided data on shipping firms, destinations, and passenger numbers and demographics. Primary data focused on advertisements, price lists and other promotional materials found at maritime archives, the Ad*Access database at the John W. Hartman Center for Sales, Advertising & Marketing History at Duke University, and the Gjenvick-Gjønvik Archives (http://www.gjenvick.com). EXHIBIT 1. MARITIME PASSENGER INDUSTRY MARKETING PERIODIZATION CHARM 2011 1. Historical Summary 2. Targets 3. Mix elements Proceedings a. Phases c. Historical Drivers - Immigrants - Steerage for immigrants 1. Immigration - Technological - Affluent Americans and - Highlighting luxury - Mid 19 th change (steam Europeans accommodations century – turbine) - Example of German line 1914 - Immigrants building Immigrant Village leaving Europe for - Luxury liners – German vs. America; UK to French vs. British Australia and New - Matter of national pride Zealand - Point is to get between points A 24 - Increasing US- and B Euro travel - Disguise fact that ship was on (immigrants going sea (due to seasickness) – back to visit the make it look like a giant hotel. old country) - Multi-class service – 1st , 2 nd , 3 rd - German-British or steerage competition via ships - WWI 2. WWI - World War I halts - Military troupes - Ships re-painted (dazzle paint) - 1914-1920 non-military sea and converted to military use. travel - Lusitania sunk 3. Tourism, - US legislation - Affluent Europeans and - Queen Mary launched 1936 alcohol and (Emergency Americans - Conversion of steerage into “third luxury travel Quota Act - 1921) - 1920s – first time class” Bohemian - 1920s-1939 severely limits Americans became accommodations immigration biggest geo target – 80% - Upgrading previous steerage - German ships - “Bohemians” flappers, areas turned over to US drinkers - Continued focus on luxury and UK - Teachers, students, - Origin of the short “booze cruise” - Great depression tourists to Canada & Bermuda from US - Prohibition (since money tight during - WWI soldiers depression) exposed to - By late 30s, short booze cruises Europe augmented by more luxurious - WWII begins ships and long itineraries (world cruises) 4. WWII - World War II halts - Military troupes - Ships re-painted and converted - 1939-1946 non-military sea to military use travel - Normandie – ultimate luxury liner seized by US, burns and sinks in New York 5. Jet age - Travel resumes - British war brides - Cruising grows in popularity as emergence - Immigrations of - Wealthy American tourists air travel supersedes - 1946 – 1970 war brides - Elderly transatlantic shipping - Increasing - Caronia (1949) expressly built for American cruising affluence - Amenities appear such as Exhibit 1. following WWII outdoor pools, air conditioning Maritime - 1956 cusp year Passenger when more Industry travelers fly transatlantic than Marketing sail Periodization - Boeing 707 goes into service 1958 EXHIBIT 1. MARITIME PASSENGER INDUSTRY MARKETING PERIODIZATION (cont.) 1. Historical Summary 2. Targets 3. Mix elements Ship Ahoy: A 6. Luxury - Jet age spells end - Elderly - Inexpensive cruises History of Cruising for of trans-Oceanic - Affluent - Sub-segmentation within broader all 1970s - sailings - Middle class cruising market Maritime present - Need to find new - Families - Land/sea packages integrate Passenger targets and uses - Education/students sailing and aviation. for equipment - Special interest - Marketing mixes become ever Industry - Increasing specific to meet niche target Marketing affluence and needs aging - Positive WOM 25 Maritime Passenger Transportation Industry Marketing Periodization As mentioned above, people have sailed the lakes, rivers, oceans and seas of the world since time immemorial. However, the modern maritime passenger industry – with regularly scheduled passage – was not born until the middle of the 19 th century with the launch of Samuel Cunard’s British and North American Royal Mail Steam Packet Company, later renamed Cunard Line. It was at this point that passengers could pay for passage on a ship and expect to arrive safely and on time. Cunard, for his part, started a business and created a marketing strategy. In fact, Cunard exists as a passenger line to this day as one