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Saga Cruises Assignment Sample

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Saga Cruises Assignment Sample

1. Introduction

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Review of this literature delved deep into aspects, such as consumers’ willingness in monetary spending during cruise travels, which is shaped by consumer satisfaction. This review emphasised a focus on one of renowned cruises in UK, Saga Cruises. An illustration of emergence of COVID-19 seemed to lead to drastic financial disruptions in this cruise firm. Hence, glimpse of feasible strategies, such as quality services, and others were witnessed, which can assist in revising Saga’s performances in post-COVID era. It has been identified that there are issues associated with brand loyalty and drop in profit that experienced by Saga Cruises during COVID-19. Customer satisfaction and quality services were reinforced with relevant models, which justify discussion in this study.

Tourism has become one of the fast-growing industries in United Kingdom, though this economy has been witnessing a surge decline in response to external effects, such as a recent pandemic. The study aims to reflect a wide spectrum of cultural tourism by emphasising consumer satisfaction, which is driven by aspects, such as monetary spending and budgets with a focal point of Saga Cruises. Considering the upward business of cruises, tourist expenditure is focused to grasp potential of Saga Cruises in a competitive business environment. In this context, a handful of aspects are consolidated in this study, which are consumers’ satisfaction, tourist monetary and time spending, organisational competitiveness, organisational challenges and more. Critical analysis is further reinforced with relevant models, which enhances one’s knowledge of tourist satisfaction and more.

2. Financial performances of Saga Cruises

2.1 Prevalence of cruise traffic in tourism

Cruise tourism severe the purpose of traveling with leisure. Cruise industry is perceived to be one of the most desired domains in tourism. This is because, over the years, cruise market has witnessed enormous growth in a number of passengers, which accelerates demands for new cruise destinations. According to Peru?i? (2020, p.95), United Kingdom and Australia witnessed 3.27 million cruise passengers, which accounted for 12% of global tourists. Hence, it is undeniable that Saga Cruises operating in UK can have a substantial performance in cruise market.

In contemporary world, cruise ships seem to offer a range of innovative facilities, which aim to satisfy growing population of global travelers. Here, Asero and Skonieczny (2018, p. 95) argued that effective cruise management strategies can fortify its sustainability, which will facilitate increased profitability. In contrast, though cruise market is perceived to have a competitive dominance in tourism yet external aspects seem to hinder its prospects with regard to revenue and profitability. For instance, in wake of a global pandemic, Saga Cruises witnessed a loss of £61 million in 200 (The Guardian, 2021). Hence, a further illustration of Saga Cruises’ financial operations and performance can be beneficial to understand its prospects in cruise market.

2.2 Financial performance of Saga Cruises over years

It is noticed that emergence of a global pandemic has hit finances of Saga Cruises in a drastic manner.
Its annual report of 2020 exhibits a profit of £109.9 million, which is declined from £180.1 million in 2019 (Saga Cruises, 2020). Though this cruise company has strived to maintain British cultural heritage, uncertainties of a pandemic have overshadowed travel industry resulting in its declined financial performances. Further research reveals how this travel brand has stepped further to fortify its brand value by announcing a requirement for its passengers need to be fully vaccinated (Radicet al. 2021, p.2). In response to COVID-19, though cruise industry is doomed to a certain extent, effective measures of Saga emerged to be beneficial in retaining its finance even amid crisis.

The above figure shows a drastic fall in turnover in 2021, which is further aggravated by loss of employees in wake of this pandemic. The cruise company had suspended its cruises until May 2020, leading to its disruptive financial performance. For instance, Saga faced a pre-tax loss of £61.2 million in 2021 financial year, declining from as high as £300.9 million in previous year (The Morning Star, 2022). This fall in revenue clearly means a decline of 15%-20% of lower earnings for tour operations, which surely makes business and competitiveness of Saga Cruises quite uncertain in cruise market of UK.

The above financial representation also exhibits a reduced stock price, which stood at 32,25,000 in 2021 as compared to 50,86,000 in 2019. Halt in operations in cruises, thus, hindered performances of these cruise businesses, and Saga is no exception. Holland et al.(2021, p.2) opined that an economic perspective shows a loss of US$300 billion in global cruise by September 2020. In addition, Reuters report shows shares of Saga to come down by 4.1% to 16.92 ounces leading to it’s ask for debt relief or impairment charge (Reuters, 2020). Hence, relative as well as effective measures appear to be a saviour to retain its previous competitiveness and performance.

The above graphical representation exhibits its reduced cash flow in a surge of COVID-19, which concerns a hamlet in its operations. Financial performance of Saga Cruises is further exaggerated in 2021 with a profit before tax of only £17.1 million, which is largely accelerated due to its pause in operations (Saga Cruises, 2021). In these financial disruptions of this cruise business, rehiring workers can be more cost exhaustive. Amid its poor travel performance, rehiring 500 workers that were from its holiday operations amid a pandemic led to advertisements of 250 roles that is also expensive, which can further aggravate its finance (Sky News, 2021). Hence, Saga’s financial performances seem to be uncertain, which can be retorted with effective customer satisfaction after situation heals.

3. Critical analysis with relation to models and theories

3.1 Relationship between tourists’ monetary spending and satisfaction

Culturally motivated tourists are considered as target consumers for distinct designations, as their high spending, as well as behavioural patterns, contribute to business sustainability and competitiveness. According to Vena-Oyaet al. (2021, p.100788), tourists’ satisfaction is shaped by aspects, such as famous landmarks, heritage sites, cruise activities, and others, which in turn, determine their monetary spending at destinations. Hence, it is undeniable that Saga Cruises, in times of financial crises, need to emphasise satisfying activities, avoidance of complaints, and more to fortify consumers' loyalty within destination alongside cruises. A further emphasis can be noticed, as high spending patterns among culturally-motivated tourists, as they tend to exhibit considerable daily monetary budget at destinations (Vergori and Arima, 2020, p.104058). Targeting this set of consumers can be effective for Saga Cruises to retain their performance in a competitive travel market.

During tourism, a tourist’s monetary budget posits a gap between their anticipated budget and actual spending. Konuk (2019, p.104) propounded that tourists’ satisfaction extracts from confirmation of their perceived expectations alongside fair price, perceived value of activities, and others, which in turn shape their intention to revisit. Considering financial disruptions witnessed by Saga Cruises, this firm needs to integrate value with its operations and activities that can retain attractions of tourists. Shahijanet al. (2018, p.2305) emphasised that consumers’ satisfaction in cruise tourism can be moulded with effective service convenience, cruisers’ experiences, and more. It further illustrated that since cruise holidays are increasing exponentially, cruise ventures need to pay attention to quality service delivery, for which tourists are willing to pay, and hence, their revisit intentions can be determined.
Further research reveals that quality can be declined easily in cruises, which not only demotivate customer experiences but also hinder their satisfaction to revisit again. For instance, sinking of Costa Concordia in January 2012 disrupted reputation of cruise market, while passengers were in confined environments in Diamond Princess in Japan 2020 during COVID outbreak hampered their experiences largely (Yoon and Cha, 2020, p.12). In this context, Saga’s cruises for over 50s incorporate inclusive experiences and competitive pricing, resulting in it being the best value-for-money cruise line in UK at the 2016 Wave Awards (The Telegraph, 2017). Hence, it is undeniable that Saga Cruises can regain its value by emphasising quality on-board services.

3.2 Influence of tourist satisfaction in cruises’ organisational sustainability

Concept of sustainable tourism comes forward, as it implies meeting diverse needs of tourists and destinations while enabling opportunities for further development, such as preserving world heritages, life-support systems, ecological integrity, and more. Sanz-Blas et al. (2019, p.1) argued that crowdedness in cruises hinder onshore experiences of tourists, and thus, impact cruises’ sustainability. Hence, effective services of sightseeing can ameliorate negative perception of crowding among cruisers, which in turn, intact their satisfaction. Casado-Díazet al. (2021, p.3) further argued that cruisers’ experiences in areas, such as mobility patterns accompanied in visits, cruise category, onshore visit facilities drive their expenditure behaviour. These, in turn, shape their perceived value, whereas help in cruises’ increased competitiveness.
Tourism industry witnessed a drastic decline amid COVID-19. A fall of 22% of tourists was seen in first quarter of 2020, which raised a threat of a further decline of 60%-80% (Sharma et al. 2021, p.100786). Hence, certain measures are highlighted for cruises to maintain sustainability and profitability in a post-COVID-era. For example,fleets of smaller ships instead of large cruises can facilitate tourist’ satisfaction along with mass vaccinations in response to COVID-19 restrictions (Renaud, 2020, p.8). This feasible strategy can shape cruisers’ satisfaction while reviving Saga’s sustainability and desired revenue.

3.3 Challenges experienced by Saga Cruises

There are several serious challenges that have been faced by Saga Cruise especially during COVID-19. Although the group is known for 50+ holidays, however all of the profit of this group is virtually accounted for insurance. Insurance is considered as a tough market and the share of the group has dramatically fallen at the time of COVID-19 (Hl.co.uk, 2020). Besides that, the growth in ease of switching and price transparency in modern time has made the insurance sector more difficult. In addition to that, this group has experienced lack in brand loyalty and lack of acceptance among young customer base. Hence, the group can focus on building more direct to consumer business by investing in brand and motivating consumers to come direct for insurance to enhance brand loyalty and young consumer base.

3.4 Theoretical frameworks

3.4.1 Expectation performance model
The above figure shows how consumers’ satisfaction is influenced by perceived performance and disconfirmation of beliefs, and expectations. Firstly, tourists form initial expectations before booking cruises and eventually, with initial consumption of services, build perceived performances of services (Buliahet al. 2018, p.26). Furthermore, with their level of expectations being fulfilled, satisfaction is determined. Hence, Saga needs to emphasise its service quality to survive in the post-COVID era.

3.4.2 Total Quality Management
TQM enables ventures to continuously improve quality of all processes by focusing entirely on consumers’ needs. Changed p

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