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Seabourn Terminates Entire Sales Team – Consolidates with Holland America: Carnival Goes Big on Big Ships!

Yesterday it was announced that Seabourn was consolidating its sales force with that of Holland America’s. What the press release didn’t explicitly state was that the entirety of Seabourn’s sale team from Steven Smotrys, Vice President, Sales and Trade Relations, to its Director of National Accounts, right on down were terminated; most effective at the end of this week. 

Now there will be a “consolidation” into a single sales force “with aligned leadership for North America and Australia trade regions” with Rob Coleman, formerly Holland America’s Vice President Sales – North America now promoted to Senior Vice President for Seabourn and Holland America sales in both North America and Australia. The spin: The move will make for a marketing “powerhouse”.  As I discuss below, I think not!

It is of important note that both Holland America’s president, Gus Antorcha, and Seabourn’s president, Natalya Leahy commented positively…but at least both commented!

This move may save Carnival Corporation some money in the short term, but it will leave a huge void in Seabourn’s knowledge base and, therefore, effective marketing both to the travel trade and consumers. I discuss this more below.

Let’s face it, with the moves over the past few years – you know the ones that I previously discussed that upset the former Seabourn president – combined with Carnival Corporation’s explicit commitment to not build any new Seabourn ships in the foreseeable future, the sale of Seabourn Odyssey, and the partial charter deal with APT, this move raises more questions than it does exude “powerhouse”.

Add to that Carnival Corporation’s announcement last week that it is building three huge 8,000 passenger Carnival Cruise Line cruise ships to be delivered in 2029, 2031, and 2033 as well as its recent consolidation of P&O Australia and part of Costa Cruise Line into Carnival Cruise Line’s fleet, and it seems clear that focus is on its mainstream, rather than luxury, cruise brands. 

Why? Understandably: Corporate profits.  The reality is that Carnival Corporation was hit very hard by the pandemic, first resulting in what I will call “panic” belt-tightening, and then, under its new President and CEO Josh Weinstein, more “strategic” belt-tightening and focus; thus its financial picture has significantly brightened.

Consistent with the current, successful, Carnival logic, aggressively supporting Seabourn – previously known as the crown jewel of Micky Arison, chairman and former CEO of Carnival Corporation – doesn’t make economic sense as its revenue (profits?) is minimal compared to those of Carnival, Princess, Holland America, and other Carnival brands. 

HOWEVER, I have not given up on Seabourn as a top ongoing luxury cruise brand. While I have no crystal ball as to what Seabourn’s future will be, under Natalya Leahy, many of the cutbacks instituted by her predecessor have been rolled back and Seabourn has focused a bit more on the software (staff, culinary experiences, etc.) rather than the hardware.  And, the staff and crew, as I hear, have upped their game quite a bit; and certainly enough to recapture favor with many previously disgruntled Seabourn loyalists.

Now, some retrospective perspective. In 2011, Carnival Corporation decided to consolidate much of Seabourn’s operations with Holland America’s, essentially making Seabourn a subsidiary of Holland America and moved its operations to Seattle, Washington. More accurately, while Seabourn owns its ships, Holland America is the one that actually operates them.  See Seabourn to Relocate to Seattle, Joining Holland America – Cruise Industry News.  

Initially, there were a lot of back office improvements, but there was also a growing conflict in what the Seabourn product was to be moving forward; in large part because the folks at Holland America, including Seabourn’s then new president, Rick Meadows, just didn’t understand what the Seabourn product was or what the Seabourn guests’ expectations were. (Oh, the number of times I would get into it with Rick emphasizing, “That’s Not Seabourn!“.)

Then there was a decision made that Seabourn sales representatives would also support the sale of Holland America cruises. Well, let’s just say that didn’t work and was abandoned fairly quickly.

Eventually, not only was there a significantly better understanding of what Seabourn was, but a further peeling back of the consolidation with Holland America, though Holland America still operates the Seabourn ships. I believe that was for three reasons:

  • Seabourn is markedly different from Holland America not only as a luxury versus premium/standard brand; 
  • The markets for Seabourn and Holland America are demographically significantly different; and, 
  • Holland America has continually struggled to find its own identity.

I also have to note that is sort of combining of sales and back offices isn’t new for Carnival Corporation and the results have consistently been, shall I say, less the optimal: Cunard-Seabourn, Cunard-Princess, Windstar-Holland America, etc. all eventually failed. 
Yet here we are!
What does all this mean for the Seabourn brand? Honestly, I don’t know. But what I do know is that Carnival Corporation’s moves including reducing the size of Seabourn’s fleet, pretty much overtly acknowledging that Seabourn’s financial role in the big picture of Carnival Corporation is minor, and eliminating the entirety of Seabourn’s sales team, is concerning. 
Will Carnival Corporation continue to support Natalya Leahy’s effective efforts to bring the luster back to Seabourn is a question that I have…and a hope that it will. 
Is there more coming in the way of changes to Seabourn and its future?  Again, I don’t know, but based on the past, I strongly suspect there will be.

With the other luxury brands (Explora, Silversea, Windstar, Regent Seven Seas) being quite stable and expanding, I wonder if Seabourn will return to its origins as a very special small luxury cruise line or ???

 

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