Cruise Law News : Maritime Lawyer & Attorney : James M. Walker : Walker & O'Neill Law Firm : Admiralty Law, Cruise Ship Accidents & Injuries

A cruise line's reputation in a time of crisis is often formed not by the circumstances which caused the crisis but by the company's attitude, appearance, and action afterwords.

I call this the "three A's" of cruise line crisis management: attitude, appearance & action. 

When disaster strikes and passengers are injured or killed during a vacation cruise, the U.S. public has a remarkable capacity to forgive the individuals and companies involved.  Part of this tendency to forgive, rather than judge, is tied to the Judeo-Christian heritage of our country - where we sacrifice resentment and seek redemption in the process.

In practical terms, Americans understand that accidents are inevitable.  "Sh*t happens," the saying goes.  Bad things happen to good people.  An individual or company should be forgiven if they demonstrate a humble and respectful attitude; they appear on the scene to take stock of the problems they caused; and they take prompt action to help others injured by their conduct.        

So how have the principal actors in this drama performed so far?

Captain Francesco Schettino failed  miserably.  His attitude has been defiant.  His appearance?  None.  He abandoned ship in dereliction of the traditional maritime duty to stay with the vessel dating back to the Medieval Sea codes.  He fled the scene of a crime.  His actions?  Self preservation. Disregarding orders by the Italian Coast Guard to return to the cruise ship and assist in the evacuation.  Lying.  I slipped-and-fell-into-a-life-boat defies reason and belief. 

Costa's chief executive, Pier Luigi Foschi, and parent company Carnival's CEO, Micky Arison, are close behind the disgraced captain in trying to ruin their reputations.

Arison admittedly expressed his condolences from the comfort of his 200 foot luxury yacht in the Miami area.  But carefully crafted corporate PR statements go only so far.  He failed to appear at the scene.  How hard is it to hop in a Gulfstream jet and fly to Rome and then head over to the island of Giglio? 

In Miami, we hear snickering that as the Costa Concordia sits on its side with dead passengers still trapped inside, some of the the Carnival executives have been seen gallivanting around town at black-tie gala parties and even Miami Heat professional basketball games.  (CEO Arison owns the Miami Heat.)  But it was only this weekend, one week after the crisis started, that Arison sent senior executive Howard Frank to Italy.  Even then, Howard appears to be in Genoa where Costa's headquarters are located.  He apparently has no intention of making an appearance at the scene of death and destruction.

Although the physical presence of corporate executives at the scene of a mass disaster may be largely symbolic, such visual images are important to demonstrate the corporation's attitude of concern and compassion.

President George Bush was perceived as demonstrating the right attitude when he appeared at the remains of the Twin Towers following 9/11.  He was photographed (left) standing on a pile of smoking rubble, with his arm around a fire chief, encouraging other fire fighters through a bullhorn.   But when Hurricane Katrina struck New Orleans and images of panicked residents waving to helicopters on the roof of flooded house were broadcast on the cable news stations, the president was no where to be seen.  Photographs of President Bush (below right), later published of him looking from a window on Airforce One 35,000 feet over the disaster below, made him appear aloof and disconnected and did his reputation more harm than good.     

Carnival has managed prior cruise disasters effectively in the past.  When an engine room fire disabled the Splendor cruise ship in 2010, Carnival sent a team of executives from Miami to San Diego where they conducted a highly publicized press conference at the port.  Carnival offered reimbursement of all cruise fares, waived all onboard purchases and promised a free cruise in the future.

Carnival followed the "three A's" of crisis management perfectly.  Its attitude was humble.  It appeared on the scene.  And it took immediate action to solve the problem.

I was so impressed that I wrote an article praising Carnival and providing my opinion why it should not be sued for the accident. 

But Carnival does not seem to know how to act following the Concordia disaster. 

We hear Carnival's CEO Arison finally saying the rights things. Five days after the crisis unfolded later, he finally tweeted "I gave my personal assurance that we will take care of each & every one of our guests, crew and their families"  He included a link to a press release issued by Carnival promising to take care of everyone.  But this weekend, there are news reports that the cruise survivors were stunned and insulted when Costa CEO Foschi offered a 30% discount on future cruises as part of proposed compensation to stave off lawsuits. 

A 30% discount?  Talk about pouring salt into the wound.  The cruise industry collects over $35,000,000,000 (billion) a year mostly from tax paying Americans yet it pays no U.S. federal taxes because it registers it vessels overseas and incorporated itself in Panama to avoid U.S. tax, wage and labor laws, and health and safety laws.  Arison himself is the richest person in Florida with a net worth of over $4,000,000,000.  

Carnival will not hesitate to make a claim against its underwriters for payment of $500,000,000 for its wrecked cruise ship as well as seeking hundreds of millions of dollars for the lost revenue caused by not being able to collect money from passengers sailing on the cruise ship in the future.  It is now rightfully facing public ridicule by offering a discount worth a few hundred dollars to avoid litigation.  I hate to think what the families of the dead loved ones think about taking a discounted Costa cruise in the future.

Carnival and CEO Arison have a mixed reputation in Miami over the years.  Lots of travel agents love Arison.  But Arison has faced more than his fair share of critics for Carnival's avoidance of taxes, exploitation of foreign crewmembers and indifference to the problem of women and children being sexually assaulted on Carnival's cruise ships.  Consider these articles: "Is Mickey A Greedy Corporate Pig?" or "The Deep Blue Greed - The Arison Clan Built Carnival into a Money Machine by Cleverly Avoiding Tax Laws" or Carnival? Try Criminal.   

Carnival has enormous financial resources and insurance proceeds to respond to the disaster and compensate the families who are suffering because of its reckless captain.  It can take care of the mess and salvage its reputation.  But does it have the corporate ethics to do so?  We know that CEO Arison loves the limelight when his businesses are successful. But if Arison and Carnival's executives don't care enough to appear in Giglio to speak with the survivors directly and assess the situation personally, they risk earning reputations no better than that of their arrogant and cowardly Captain Schettino. 

Photo credits:

Top:  News Pictures / Rex Features

Bottom:  ESPN

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The cruise industry has an image problem.  Royal Caribbean is the main reason.

This year began with Royal Caribbean's business-as-usual approach to ferrying passengers back and forth to its "private destination" in Labadee (actually sovereign Haitian land leased from Baby Doc Duvalier).  While Haitians tried to dig out of the rubble and bury their dead following the devastating earthquake, Royal Caribbean passengers zip lined, jet skied, or sat drinking margaritas on the cruise line's private beach.

Royal Caribbean received widespread condemnation from advertising and PR experts nationwide. 

Newsweek magazine joined the ranks of those questioning Royal Caribbean's corporate morality in an article "Setting Sail on a Haitian Pleasure Cruise - the Moral and Economic Dilemmas of Royal Caribbean's Labadee Port."  On the same day, the widely respected non-profit organization, Center for Responsible Travel, issued a press release chastising Royal Caribbean for not doing enough. The non-profit group characterized the cruise line's move as "unsound" and a "colossal public relations faux pas."

This sentiment echoes the criticism by PR experts in Advertising Age's "Royal Caribbean Blasted for Continuing Stops in Haiti" where the consensus is that this was a "massive debacle" which may have long term damage to the Royal Caribbean "brand." 

The Feministing Blog admonished Royal Caribbean for taking advantage of the incredibly poor country of Haiti and urged its readers to consider going on a cruise line other than Royal Caribbean "or tell them that these practices are unacceptable."

Royal Caribbean's President Adam Goldstein told National Public Radio that the decision to continue to sail to Labadee was a "no-brainer," a flippant and indifferent remark reflecting, perhaps, the core values of the "Nation of Why Not?"  

But this nothing new for Royal Caribbean. It's just the latest debacle in a series of public relations blunders dating back over a decade.

In mid 1990's, the cruise industry's arrogance had reached a zenith.  The industry thought itself to be above the law.  Cruise ships routinely dumped everything overboard - from plastic garbage bags to crime scene evidence.  The cruise industry treated the sea like a garbage dump.  It treated crime victims like criminals.   

In the late 1990's, the U.S. Coast Guard caught Royal Caribbean engaged in the widespread dumping of oil and chemicals.  The Justice Department responded by fining the cruise line $1,000,000.  In response, the cruise line went to its PR people who dreamed up a campaign of "Save the Waves."  The PR experts posed the cruise line as a leader in protecting the environment.  Royal Caribbean posted this mantra on signs all over its cruise ships.  All of the waiters, bar tenders, and cabin attendants had to wear "Save the Waves" badges touting the cruise line's commitment to protecting the seas on which it sailed. 

The problem, however, is that the cruise line didn't change its ways.  Royal Caribbean continued to illegally discharge oil, waste and fecal matter everywhere from the Caribbean to the pristine waters of Alaska.

The Feds caught Royal Caribbean dumping again.  And the U.S. government fined the cruise line again - this time $8,000,000 - and placed it on probation.  Did Royal Caribbean learn its lesson?  No, the illegal discharges increased.  While the crew members wore their "save the waves" buttons above deck while serving passengers cocktails, Royal Caribbean engineers below the decks fabricated secret by-pass values to dump everything from raw sewage to chemicals used in the photography labs directly into the ocean. Royal Caribbean cruise ship even dumped oil and sewage into the waters right outside of the executives' windows overlooking Biscayne Bay.

The U.S. Attorney General, Janet Reno, a Miami resident herself and an environmentalist as well, was not amused. The discrepancy between how the cruise held itself out to the public as a green company versus its actual criminal conduct was not lost on the Attorney General.  By the time she was through, Royal Caribbean pled guilty to multiple felonies, received another whopping fine of $18,000,000, and agreed to a five year probation.

While Royal Caribbean was forced to clean up its act on the environmental front, it found itself embroiled in multiple lawsuits after women and children were sexually assaulted during cruises.  Its own guests accused it of hiding evidence and tampering with crimes scenes on the cruise ships.

Royal Caribbean went back to its PR consultants for a quick fix of the problem.  The result was a much publicized "zero tolerance" slogan where the cruise line promised to report all crimes to the FBI and to preserve evidence to be used against the perpetrators, who too often were crew members.  But like the "save the waves" marketing gimmick, the "zero tolerance" motto was just another PR scheme.    

All too often, by the time the FBI arrived on the scene following a shipboard rape, all evidence was gone.  The cruise industry was often accused of sanitizing the cabins and steam cleaning the carpets. The destruction of evidence on cruise ships seemed so thorough that it appeared like a scene out of Pulp Fiction where hit men Vincent (John Travolta) and Jules (Samuel L. Jackson) call upon Mr. Wolf (Harvey Keitel) to oversee the meticulous clean up of their bloody car. 

In 2005, I was retained to represent the newlywed bride of George Smith IV, who disappeared from Royal Caribbean's Brilliance of the Seas under mysterious circumstances.  At this time, Royal Caribbean was an admitted corporate felon which had just come of probation for its environmental crimes and lies to the U.S. Coast Guard. 

The cruise line quickly labeled Mr. Smith's death to be an "accident."  But there was blood all over the awning below his cabin.  And when photographs of what many thought was a crime scene began appearing on cable news every night, the American public had doubts about what Royal Caribbean was saying.  For the next year, the cruise line fought a highly public PR battle in the press, pandering to their base of travel agents and cruise fans while attacking the grieving families. 

In the process, the cruise line's history of shipboard crimes came into focus.  The U.S. Congress convened five hearings from 2005 through 2009 into the issue of whether cruise ships were safe.  The debate focused almost exclusively on Royal Caribbean's history of sexual assaults, shipboard crimes and unexplained disappearances of passengers.

While Royal Caribbean decided to fight a very public battle in the press, behind the scenes other cruise lines cringed as the cruise industry's image sank further and further.  When things could not get any worse, the President of Royal Caribbean's main competitor, Carnival, entered the public relations nightmare.  President Dickinson publicly proclaimed that the death of young George Smith was a "non-event."  Not only did Carnival's President decide to state this publicly, he chose to do so at the cruise industry's annual "Sea Trade" convention in Miami Beach in front of hundreds of reporters - while sitting next to Royal Caribbean's President Adam Goldstein. 

Rather than distancing himself from such disrespectful comments, Mr. Goldstein sat smiling and was later photographed openly chuckling with Mr. Dickinson in front of the cruise delegates.  About what?  Who knows.  But the damage was done. The cruise industry's indifference and arrogance came through loud and clear. 

Over the past five years, if something outrageous happened on a cruise ship, chances are the ship carried a Royal Caribbean flag.  Child molestation, sexual assault, norovirus, employee theft, passenger and crew member over-boards - you name it, Royal Caribbean has it covered.  As I pointed out in Royal Caribbean Press Statements And Other Gobbledygook, the mantra of other Miami cruise lines is "only at Royal Caribbean could this happen."

In the next couple of weeks, we will report on some of the recent PR blunders by the cruise industry.  And chances are they will involve our friends at Royal Caribbean. 

Credits:

Haiti - earthquake     AP (via Mail OnLine)

Royal Caribbean cruise ship        The Consumerist    Don't miss reading "Royal Caribbean Caught Infiltrating Review Sites With Viral Marketing Team."

Cabin        MSNBC

Awning     CBS News

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Cruise lines which are in touch with their market understand the need to be versed with all aspects of Social Media 2.0.  Twitter, FaceBook, Flickr, and YouTube all present an inexpensive and highly effective way to get a company's message out to the public.  This is particularly important in times of crisis management, such when a fire breaks out or a bout of swine flu is running its course on a cruise ship.

Most cruise lines remain clueless.  Royal Caribbean, for example, has a Twitter page @royalcaribbean, but it has not been updated since June 19th.  The only tweet says: "Look for updates here soon!" - that was over three months ago. It resembles an abandoned store front.  

Other cruise lines which are using Twitter or FaceBook are not maximizing the potential offered by social media applications.  Companies like NCL  @NCLFreestyle have pleasant enough websites and utilize Twitter but are mostly just trying to push ticket sales.  Recent tweets by NCL: "hottest new cruise," cruises for "$249," etc.  You get the idea.

The problem with these tweets is that they flaunt the etiquette which has developed on Twitter.  Effective "twitterers" understand that hard sale tactics don't work.  In fact, they turn potential customers off.  But interacting with the public, and providing accurate and relevant information via a conversation, works.  You could imagine how ineffective and counter productive it would be if I took NCL's approach on Twitter - "hottest new lawyer," lawsuits for "$249," etc.  A bad idea.

Princess Cruises - What's Social Media?

When things go wrong at sea, the public deserves to receive accurate information, fast. And Twitter is the best way to do just that. 

When the Princess cruise ship "Royal Princess" caught fire on June 18th, the cruise line didn't release any information to the public.  But a passenger, a Pastor from South Carolina,  @gregsurratt tweeted about the fire from his iphone on the cruise ship.  He indicated that the fire was bigger than expected, that the cruise ship was dark, and that a tug had to tow the ship back to port in Egypt.  Frantic families in the U.S. had to rely on Pastor Surratt for information about their loved ones. He even tweeted photos of the fire, the passengers sprawling out on the deck in the dark, and the tug via "Twitpic" - an application which permits photos to be uploaded onto Twitter. 

When the cruise line finally awoke and posted its typical less-than-forthcoming corporate press statement, no one was paying attention to Princess Cruises.  Everyone was listening to Pastor Surratt tweeting away on the cruise ship in the Mediterranean.  Most troubling was that the press releases finally issued from Princess Cruises' corporate offices in Santa Clarita down-played the incident and provided incomplete and misleading information. 

Princess Cruises not only lost an opportunity to interact with the public via Twitter, but it lost credibility in the process.    

Twitter and YouTube - Effective PR Tools - P & O Cruises Gets An "A" 

Princess Cruises' sister brand P & O Cruises knows what it is doing in the world of social media.  P & O Cruises has had more than its fair share of bad things happen on its cruise ships.  It is best known for the tragic death of Dianne Brimble, who died due to a toxic mix of alcohol and a date rape drug several years ago.  The brand was known for heavy drinking, out of control parties and general debauchery.

But in the last two years, the cruise line has turned its image around.  The PR people at this cruise line rebulit P & O's reputation.  Social media played a big part.

For example, last May when the Pacific Dawn was sailing with passengers and crew infected with H1N1 swine flu, the news media in Australia went nuts. Front page news articles labeled the cruise ship the "swine ship."   

P & O went on the offensive. CEO Ann Sherry began giving short statements on the cruise line's blog.  The cruise line's website contains links to its Twitter and FaceBook pages as well as to "ship blogs" including the Pacific Dawn.  The cruise line knew how to upload videos of cruise activities to its ship blogs as part of its general marketing. It now had the experience to use this media to deal with this crisis. 

Ms. Sherry appeared on the scene, wearing a very smart red dress, and looked directly into the camera. She provided information about sick passengers and what the company was doing to address the issue. The cruise line used its Twitter page @POCruises to provide additional updates and links to the video.  It even uploaded a photo via "Twitpic" of Ms. Sherry, standing in the rain surrounded by reporters, while the beleaguered cruise ship with its sick passengers arrived at port. 

When the flu passed its course, the next ship blog, entitled "Clean Ship," showed photos of the Captain and crew having fun in the disco, smiling and laughing.  The message to the public was quite effective - everything is fine, come on aboard.

In the past several months, P & O Cruises continues to use social media effectively.  Ms, Sherry still appears regularly on YouTube videos, talking about the presence of surveillance cameras on the cruise ships, responsible drinking programs, and "customer care" teams.

it is nice to see a cruise line connecting with the public in this manner.     

Photo credits  

Photo no. 1 of Ann Sherry - Zimbio - "P & O Cruises Holds Swine Flu Conference" (Photo by Graham Denholm/Getty Images AsiaPac)

Other photographs and video - P & O Cruises

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