Troubled Carnival brings back ex-CEO Bob Dickinson as consultant
Will Bob Dickinson try to right the ship? While his initial consulting assignment supposedly will deal with Carnival’s travel agency relationships, we wouldn’t be surprised if his assignment broadens into other areas, such as Carnival’s rocky last couple of years.
After several months of instability, the world’s largest cruise ship company is bringing back a familiar face.
In an interview Monday morning, Dickinson said his initial assignment would be to examine travel agent relationships with the company’s North American brands: Carnival Cruise Lines, Princess Cruises, Holland America Line and Seabourn Cruise Line. His role will include studying agent perceptions of the brands compared to perceptions of their competitors, cooperation between brands and agents and best practices.
“Because I’m not tied to any one brand, I have sort of a 30,000-foot look at it; I can be very, very objective,” said Dickinson, 70. “It may be difficult for a brand to say ‘Gee, I made a mistake’ or ‘Gosh, I should have seen that and I didn’t,’ or ‘Gosh, maybe this strategy was the wrong one.’”
While he acknowledged that “there will be egos involved, obviously,” Dickinson said his job will be simply to present solid facts and leave the action up to managers. “It’s not meant to be an adversarial effort, it’s meant to be a collaborative effort,” he said.
The Miami-based cruise operator did not make any executives available for interviews Monday, but said in a statement that Dickinson will report to Carnival Corp. Vice Chairman and Chief Operating Officer Howard Frank.
Dickinson served on the parent company’s corporate board from 1987 until April, when he reluctantly did not stand for reelection. The reason, he said, was that in the UK, where the stock is also traded, he was not considered an “independent” director because of his long history with the cruise line. But he didn’t want to leave the industry, so Dickinson said he and Frank started talking about other possible roles.
The consultancy agreement, effective June 1, is for one year but can be renewed, Dickinson said.
He said the work will also touch on advertising and could include public relations and consumer and trade outreach.
Dickinson comes on board at a rocky time for the cruise company, stemming from the disabling February fire aboard the Carnival Triumph. The ship was powerless in the Gulf of Mexico for several days on what became known as the “Poop Cruise” because passengers did not have widespread access to working toilets. A series of technical issues on other ships drew attention, taking a toll on the cruise line’s reputation.
In May, Carnival lowered its earnings forecast for the year to $1.45-$1.65 a share, saying it had been forced to drop prices to drive demand. The company had already lowered its 2013 forecast in March, dropping a pre-Triumph estimate of $2.20-$2.40 per share to $1.80-$2.10.
The company’s woes, while hitting Carnival the hardest, appear to be affecting the public’s perception of the entire industry. An online Harris Poll conducted in May showed that perceived quality, trust and purchase intent for seven brands had declined compared to a post-Triumph poll. But the news was the worst for Carnival: The poll showed that perceived quality of Carnival dropped 12 percent from the February survey, trust dropped 11 percent and purchase intent declined 8 percent.
For some regular cruisers, the news about Dickinson’s reengagement with Carnival was welcome.
“Typically our readers don’t care much who runs a cruise line,” said Carolyn Spencer Brown, editor-in-chief of the website CruiseCritic.com. “But wow, I put a post up last night and the response has been incredible. They call the guy Uncle Bob.”
Mike Driscoll, editor of the weekly trade publication Cruise Week, said the focus on travel agent relationships is necessary, especially for Carnival Cruise Lines.
“It needed to happen because Carnival has a lot of issues with the distribution system that go beyond all of the negative consumer issues this year,” he said. “Travel agents are the primary distributors of cruises. They’re not pushing Carnival to the extent that they used to, and they are pushing Carnival’s two competitors. And they are pushing sister brands.”
Dickinson said the cruise company’s message needs to stay centered on the value proposition of cruise vacations.
“To me, the best defense is a good offense,” he said. ___