Royal Caribbean could have changes coming to its co-branded credit card.
During the Royal Caribbean Group second quarter earning call with investors, company executives hinted at changes are coming to its credit card offering.
Royal Caribbean has a Visa credit card that is offered through Bank of America.
When asked about the card and its future, Royal Caribbean Group CEO Jason Liberty said, "We do have a co-branded credit card. It is tied today to our loyalty program, but not in the way that fits our ambition."
That statement appears to point towards a change consumers can expect in the future.
Something coming "very soon"
Mr. Liberty didn't talk specifics, but he did elaborate a bit more on the subject, tying it into the cruise line loyalty program.
"I think you’re going to see something very meaningful coming out of that very, very soon," he said. This is the strongest signal yet that the Royal Caribbean Visa Signature Card may undergo a major revamp.
While no timeline was given, the fact he said "very soon" is more interesting considering the changes rival Carnival Cruise Line made to its program.
Carnival recently rolled out controversial changes to its loyalty program, including a brand new credit card.
Royal Caribbean's Visa Signature credit card isn't tied to its loyalty program in the same way that Carnival's new co-branded credit card will be tied to Carnival Rewards.
With no annual fee, the credit card offers cardholders the ability to earn points on everyday purchases that can be redeemed for onboard credit, stateroom upgrades, cruise discounts, merchandise, and more.
Carnival's card is far more integrated and crucial to its new loyalty program.
As part of Carnival Rewards, it allows cruisers there to earn points towards a loyalty program.
Royal Caribbean's card is limited to simply onboard experiences and cruise bookings. It has minimal synergy with Crown & Anchor Society.
A credit card ties into its loyalty program
The credit card change appears to be part of a deeper push towards loyalty members.
Royal Caribbean is aggressively investing in its loyalty and digital ecosystem. During the earnings call, they mentioned 40% of guests now come from loyalty members and loyalty guests spend 25% more per trip than new passengers.
"Loyalty that really impacts guest behavior… keeps them inside of our ecosystem," Mr. Liberty said.
"Our guests are very focused on recognition and also being incentivized for the spend and loyalty that they provide."
He went on to say, "Especially on the loyalty program side, we are very tuned into and have a lot of plans on what things our guests and our brands feel are a value to them that would result in them behaving even more loyal to us."
A new credit card could further incentivize high-spending guests, boost repeat bookings, and even compete with hotel and airline programs.
What could a new Royal Caribbean credit card look like?
There were no details shared during the earnings call beyond the vague ambition to change its credit card, but we might have a vision for it based on public filings.
Royal Caribbean recently filed trademarks with the U.S. Patent and Trademark office for phrases that sound a lot like they could be used for a new credit card.
- ROYAL ONE
- ROYAL ONE PLUS
- ROYAL ONE REWARDS
- ROYAL ONE RESERVE
- ROYAL ONE POINTS
- ROYAL ONE PREMIER
In fact, the description of some of these trademarks specifically say they're for a credit card.
"ROYAL ONE RESERVE™ trademark registration is intended to cover the category of magnetically encoded credit cards and loyalty cards that track customer purchases for reward purposes."
"ROYAL ONE POINTS™ trademark registration is intended to cover the categories of retail and online retail store reward program; Credit card reward programs services; the administration of incentive award programs related to the sale and use of credit card accounts."
Loyalty war is heating up
It remains to be seen if Royal Caribbean will go as aggressively into rebuilding its loyalty program as Carnival, but it does appear they are very keen on building its base out.
By expanding into river cruises, building new ships, and developing private destinations around the world, it's clear Royal Caribbean wants to leverage its product lineup as a differentiator among a crowded travel field.
They've made it no secret competing with land vacations is a goal of ships like Star of the Seas or Icon of the Seas, and having these best-in-class assets is a major component.
During the call, Mr. Liberty made a bold statement, "If somebody goes outside of our ecosystem… we should look at that as a fail."
By being all-encompassing, they believe they can hold onto existing customers better while at the same time appealing to new cruisers with flashy offerings that are unrivaled.
