Carnival fathoms consumer hunger for social impact

Not only is Fathom a new brand, but it also lays claim to an entirely new travel category. Michele Witthaus learns more from Tara Russell, president of the world’s first social impact cruise line

Carnival fathoms consumer hunger for social impact
This article was first published in the Autumn/Winter 2015 issue of International Cruise & Ferry Review.

Tara Russell is new to the cruise industry. Having trained in engineering, she has had a successful corporate career working for the likes of GM, Intel and Nike, with a growing focus on philanthropy over the years. “I am passionate about using business for social good; building social enterprises from the ground up,” she says. “For me, the opportunity to use business to meet social needs is my personal focus – to harness and leverage sizeable platforms in ways never done before.”

Carnival Corporation has chosen Russell as the figurehead of its bold new business venture, Fathom, which aims to harness pent-up demand for what it calls ‘social impact travel’. She is also Global Impact Lead for the corporation’s ten brands.

Founded on principles of social entrepreneurship, Fathom seeks to develop long-term relationships in its partner countries in the fields of education, environment and economic development, so that the brand’s guests can experience meaningful personal enrichment through projects on the ground.

The idea for Fathom grew out of a “crazy idea” that Russell developed together with Carnival Corporation’s president and CEO Arnold Donald (whom she describes as a friend) about pairing voluntary community work with cruising. “Carnival Corporation has a history of doing great things in the world – Micky Arison and his family have a history of generosity,” observes Russell. “I believed the company could do more to harness assets in a unique industry platform in a way nobody had done before. Arnold Donald shared the corporation’s interest in leveraging older corporate assets by marrying real market demand with real social needs for the long term.” The catalyst in this is a diverse group of travellers composed of “people who have a growing hunger to make a difference in the world,” as Russell puts it.

Qualitative and quantitative research followed to gauge the true level of demand for this differentiated travel experience. The company used McKinsey in the US to conduct an extensive market research study of both psychographic and demographic data. Russell points out: “This is not some corporate social responsibility project but is a business venture that has had to justify its potential ROI for a place among the brands.” Happily, the numbers added up and Fathom was born. The new operator will initially transport guests – mostly sourced from North America, the United Kingdom, Northern Europe and Australia – to the Dominican Republic (from April 2016) and to Cuba (from the following month) on Adonia, which is being redeployed from P&O Cruises (UK). Around 700 people will be part of each voyage, served by approximately half as many crew. It is expected that nearly 40% of guests might otherwise never have chosen to cruise.

“The range is broader than other cruise lines, including millennials who combine travel hunger with values; mindful families; and what we call the ‘bewildered and aware’: they are already cruising, well experienced and travelled, and have been philanthropic through money but want the opportunity to do more,” says Russell.

There is clearly value for Carnival Corporation in being the first mover in this new travel category as it will allow the global company to gain an early foothold in Cuba as it opens for business with the US. It was announced on 7 July that the company had achieved US approval as the first step towards bringing Fathom’s guests to Cuba for cultural exchanges under the existing 12 criteria for authorised travel.

“The addition of Cuba as a destination enhances the impact Fathom can make in the Caribbean,” explain Russell. “While the Dominican Republic was established as Fathom’s first partner destination, Cuba represents an important step for Fathom to expand its purpose-driven approach to ensure holistic, transformational societal contributions that will help the entire Caribbean region flourish.

“In terms of potential economies of scale, some of Fathom’s Dominican Republic partners also provide support services in Cuba, so they understand the real needs that exist in that country as well.”

She emphasises that, like the relationships Fathom has established in the Dominican Republic, the Cuban partnerships will be formed with proven, trusted local organisations. “Many Americans are interested in and curious about Cuba, and the country provides great potential opportunity to make a tremendous humanitarian impact through Fathom's cultural exchange programmes authorised under the US Department of Treasury.” Cuba currently hosts approximately three million visitors a year, of which just 90,000 are from the US, a number which the IMF estimates may double following the easing of US travel restrictions.

Regarding its plans for both countries Fathom will visit, Russell says: “We are excited and people are demonstrating a real desire to engage. Now we are focused on converting that to bookings as we get additional tools out to the trade.”

A key message to consumers is that the day-to-day experience on a Fathom voyage is going to be immersive, to say the least. “We’re excited about the holistic impact of the journey. The Fathom experience starts long before you sail and should linger long after. The first one-and-a-half days are spent onboard – we have a variety of onboard programmes, with films and workshops to prepare people for what to expect. We see the Fathom experience as so different that we don’t even call it a cruise,” says Russell.

She emphasises that although there will be some training and education as part of this process, “this will not be a ‘boot camp’.” The ship will be repurposed to allow for special activities, including scavenger hunts, onboard workshops and mixers to help people get to know other travellers. Once onshore, the ‘three e’s’ of education, environment and economic development are embodied through intensive learning from local partners.

The initial seven-day voyage will depart from Miami for Amber Cove, Carnival Corporation’s new dedicated cruise port in the Dominican Republic.

Starting with one ship will enable Fathom to test the market – and if it works, the model may be extended. “With the Adonia, the intention is long-term but we have to demonstrate a sizeable enough market. The hope is to grow the fleet of Fathom social impact ships.”

The refit of Adonia scheduled for March 2016 at Grand Bahama Shipyard is not architectural, but comprises soft ‘wallpaper’ changes. Fortunately, given the Fathom ethos, the ship doesn’t have a casino, so there will be no need to spend money removing such a facility.

Key partners for Fathom include Stanford Design School, social entrepreneurship specialists Ashoka, Etter Design, McKinsey & Company and Uncorked Studios. In the Dominican Republic, the brand will work with IDDI, a non-profit organisation that helps alleviate poverty in rural and urban areas in the Caribbean. Russell says Fathom hopes to extend its work with IDDI to Cuba.

Drawing guests from many walks of life and offering a novel alternative to the voluntourism and cultural immersion options currently available, Fathom expects to carry 35,000 travellers a year (more than 700 per voyage) and Russell is confident that this will grow in future. “We are feeding a growing and deep hunger,” she says.

In her capacity as Global Impact Lead for Carnival Corporation & plc, Russell is already at work to enable the other brands to engage with the Fathom experience through shore excursions and activities in the partner countries. She says: “The executive leadership of Carnival Corporation has been eager to find ways to harness the scope and scale of the company’s global resources for social impact. As such, Carnival Corporation will continue to explore unique opportunities – tailored to each brand – to integrate social impact into its operations.”

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Michele Witthaus
By Michele Witthaus
Monday, February 15, 2016