American discount cruises

American Classic Voyages sails the ROIling seas of data analysis

gOOD DATABASE MARKETING enabled American Hawaii Cruises to book all 800 beds in its July 2000 voyage, up: from just over an 80% occupancy rate in July of 1999. But great database marketing enabled the line to sell our its July 2001 capacity as well, despite having added a new ship--hosting an additional 800 cabins--to its fleet.

Data analysis also allowed Chicago-based American Classic Voyages (American Hawaii's parent firm) to target young professionals with marketing campaigns better suited to their buying patterns, and to focus its efforts within a geographic market. As a result, not only did the line's occupancy rates jump to capacity but, as the new group booked earlier and was less bargain-conscious, it generated a 20% increase in revenue as well.

With the available spaces reserved early, American Classic Voyages' director of marketing development Kathleen Dalsaso was able to allocate more of the company's $15 million advertising budget for longer-term projects, such as brand building.

The young professionals segment was discovered through comment cards and cluster analysis. The buying patters of this market were very different from those of other traditional cruise takers, such as seniors. Young professionals tend to book their trips earlier than many clients--in some cases between nine and 12 months in advance. Soliciting them as part of the usual marketing cycle--three or four months before a ship sets sail-- was a waste of resources.

This segment was also more responsive to less expensive online advertising. Between American Hawaii's capacity to target some of its new customers through a cheaper medium, the ability to send out fewer, better targeted solicitations and the lessened need to discount unsold cabins close to sail time, the July 2000 cruise's marketing dollar return on investment (ROI) nearly doubled.

However, American Hawaii's ROI numbers fell for the July 2001 season, as it concentrated on making sure all the berths in its new ship were filled in order to generate buzz within the cruise community.

The parent firm wasn't always able to plumb customer information. Before 1997, its marketing database was a "flat file" capable of limited correlative analysis. Now the file contains far more data on American Hawaii's customers. Through a deal with Acton International Ltd., Lincoln, NE, American Classic Voyages can append more than 20 variables per name at a rate of around $80/M.

"The system was fragmented, inefficient [both] analytically and from a cost perspective," says Dalsaso, who notes that each brand had its own database.

Targeting also allowed American Hawaii to better direct its multichannel efforts, which include mail, a presence in travel agencies and space advertising within a specific geographic area to create maximum impact. Rather than do a blanket mailing within California, Dalsaso isolated 100-block groups out of the more than 3,000 within the state that generate 30% of the cruises' traffic.

The parent firm has seen a 40% rise in ROI to this segment since it began appending age and income data, and Prizm lifestyle index duster information, to find matches with American Hawaii's customers in 2000.