CES 2017 Keynote Carnival Corporation CEO Arnold Donald

Yes, Arnold Donald became president and CEO of — you'll get your chance — he became president and CEO of Carnival Corporation in 2013 after serving on the company's board for 12 years. He runs the world's largest leisure travel company, carrying nearly 11 million passengers each year. Carnival Corporation's ten different brands operate more than 100 ships that visit hundreds of worldwide ports. The fleet is big enough to actually be one of the world's largest navies, you know. Many of these US brands include Carnival Cruise Line, Holland America Line, Princess Cruises, Cunard...

Giving a warm welcome to a true innovator, the president and CEO of Carnival Corporation, Arnold Donald!

It's great to be here, and congratulations on CES's 50th anniversary.

Wow, look at this, we've got quite a turnout.

Nicely done. Well, after all, the desert is not exactly a cruise line's home port.

Thank you, thank you, thank you. So look, it's wonderful to be here today. You know, I'm excited to share our new innovation with all of you, all of you who are changing the world every day in so many ways. Not everyone knows this, but Carnival Corporation happens to be the world's largest experience enterprise, and it's our sole purpose — our sole purpose — to exceed our guests' expectations, to make our guests happy, to transport them into a world of possibility and discovery. With today's unveiling, we're going to show you how Carnival Corporation will bring people together through technology, giving our guests a unique opportunity to share special moments with family and with friends, and to connect more deeply — to connect more deeply with the people, the places, the cultures that they encounter on their vacation journeys. At Carnival Corporation, we have a special connection to the sea. Our guests' experiences are delivered via the world's oceans, and virtually every destination in the world touches the sea. Our experience ethos was selected almost three years ago with a Super Bowl ad, and that ad reinforces our connection to the sea. I really don't know why it is that all of us are so committed to the sea, except I am. I think it's because, in addition to the fact that the sea changes, and the light changes, and ships change, it's because we all came from the sea, and it is an interesting biological fact that all of us have in our veins the exact same percentage of salt in our blood that exists in the ocean. And therefore, we have salt in our blood, in our sweat, in our tears. We are tied to the ocean, and when we go back to the sea — whether it is to sail or to watch it — we are going back from whence we came.

Carnival Corporation: connecting people, places, and cultures across the world to create unforgettable experiences.

I think we all have our time machines. Some take us back; they're called memories. Some take us forward; they're called dreams.

So we want to get back to the purpose of why people take cruise experiences, which is really to connect with other people, other cultures, other destinations around the world. What we want to do is create a new level of service that is enabled by technology but not technology-centric. Our ultimate strategy is to make a cruise personalized, make it simple, and make it hassle-free. You are going on a journey when you go on a cruise ship, but you're also going on a journey of experience and of adventure. And we wanted to create a product experience that itself was like a journey. On the digital side, we have the Compass, and on the physical side, we have the Medallion. In a sense, it's like a modern-day currency. It's technically the most advanced currency you can imagine. It empowers you to get into places automatically; you can buy things with this, and it enables personalized experiences. Each Medallion is personally assigned to each guest, so their profile is connected to the Medallion. Just by walking up to your stateroom and opening the door and walking inside, you don't need to bring out your phone, you don't need to tap in a code. When we started designing the Compass, we wanted to make sure we designed it in a way that anyone could understand. And what everyone in the world understands is time. So the navigation on the Compass is just simply left or right as it relates to a timeline. Being able to look forward and engage in experiences allows you to get excited, allows you to maximize your experience because you know everything that's available for you. And then navigating up or down just allows you to navigate up into possibilities or down into detail. And it's that persistent connection that allows us to take personalization to the next level, and we think that's what's super special.

Now the excitement begins at home. Guests are immersed in the world of Ocean as they begin to explore Ocean Compass, their interactive digital companion. Not only can guests reserve signature onboard experiences like dining, spa treatments, and shore excursions, they can also prepare for their upcoming voyage in a simple and seamless way thanks to Ocean Ready. A completely transformed experience is made possible when guests receive the ultimate key to it all before they even leave home: introducing the Ocean Medallion. Innovative one-of-a-kind technology that links our guests to a more personal experience. Everyone sailing receives a Medallion as part of the experience, and guests can even choose to personalize how they would like to express it with optional Medallion accessories that range from active to luxury. Guests can engage deeper into the experience by designing a travel companion on the digital companion that starts at home and comes to life throughout the voyage. Ocean Ready revolutionizes embarkation day with a streamlined arrival process. Waiting in line and checking in is replaced by a welcome greeting that takes only moments, and guests can go directly onto the ship. Once aboard, the Medallion is all you need. Entering the stateroom, shopping, ordering drinks, linking to onboard photographers, locating travel party members, and so much more is now absolutely seamless. The Medallion also triggers unexpected interactions, enabling the crew to surprise guests with unforgettable moments. From the moment guests step onboard, their vacation can be fun, amazing, and full of new experiences. No IDs, credit cards, or cruise cards are needed; guests can simply use their Medallion and Compass. And Compass comes to life onboard the ship with Ocean Concierge, a persistent friendly companion who ensures every guest can maximize their vacation experience. Whether fine dining, shows, shipboard activities, or shore excursions, Ocean Concierge ensures all experiences are accessible by all guests, and all recommendations are tailored to their preferences at all times. Staying connected is easy: guests can communicate with their family, friends, or anyone on board, view personal preferences along the way, view onboard activities, and connect with social networks to share their personal vacation with the world. Vacations are made simple again when whims and desires are easily fulfilled using "Here and Now." Guests can stay relaxed anywhere on the ship and still request their favorite food from the Lido deck or a cocktail from any bar directly from their Compass. Before they know it, a friendly crew member finds them with the order in hand. Looking to arrange for a favorite glass of wine later this evening or tomorrow during the show? "There and Then" enables the crew to deliver future requests wherever the guests may wish to be. Upon arrival at the theater, the perfect glass of wine arrives as requested while guests enjoy guaranteed seating. Those interested in trying their luck in new and interactive ways will find gaming beyond the casino. Play Ocean invites guests to engage in digital and physical games all over the ship. Games will seamlessly merge into the fabric of the guests' experience, starting at home and evolving through the vacation. Play Ocean brings a vast array of immersive games, engaging events, and deep interactive experiences throughout the cruise. Memories are captured at the best moments and are available however the guests want them. They can instantly view and share all of their media right from the Compass. Digital photos and artifacts can be collected and made into one-of-a-kind keepsakes that are sent right to your home. Personal vacation memories can be shared during and even after the trip. The Medallion will enhance our guests' vacations before, during, and after the cruise, making every moment more simple, more personal, transforming transactions into seamless interactions, and creating one-of-a-kind vacation experiences that can't be found anywhere else. The Medallion changes everything because it's at the center. It is the guest, and it's the way they are interacting with their overall experience. At the core, we're taking the service delivery burden off the crew so they can do what they do best: interact with guests to make them happy.

You know, I love that music 'cause I like to make it real, you know? I like to make it smooth, so it's all good, you know? But look, I just want to say that now that I've introduced all these wonderful people to the Medallion, why don't you take it from here?

What makes Medallion Class experience so special is the level of personalization. Our focus on personalization is all about the guest. Personalization is frequently talked about in marketing these days, but true experience personalization is seldom done. Targeted ads, web banners, email campaigns are not experience personalization. To us, experience personalization means so much more. It means exceeding guests' expectations in ways that cannot be anticipated. With the Medallion, experience personalization happens all in real time. We start at home with the guest's preferences, social media photos to set context, but this is where most others stop. With the Medallion, when it arrives at home, the experience begins. Every guest becomes Ocean Ready, and personalization emerges across the entire vacation: from home to airport, to transportation, to port, and all the way through the ships and destinations. Based on physical and digital and human interactions, we create what we call the Guest Genome, which evolves multiple times per second. Let's say you have an interest in nature, so you go whale watching; you're a gamer, so you play a few hands of blackjack; and you enjoy Italian food and wine. The Guest Genome evolves in real time, enabled by literally hundreds of algorithms running on the edge, creating what we call Experience Intelligence, which is what empowers us to maximize each and every guest interaction. Experience Intelligence is our rocket fuel that powers something that we call Ocean Concierge. Every guest has an Ocean Concierge working continually to make sure their vacation is great. And Ocean Concierge maximizes each and every guest experience, all in real time, with something we call Experience Invitations. We've gone well beyond conventional segmentation. In fact, every guest is a segment of one, and every guest represents many markets. Joe Pine wrote about this as early as 1999 in his book The Experience Economy. I've told you what Experience Intelligence is, but let me share what it is not. It's not big data analytics. Big data only helps the next guy, and that's not guest centricity. At Carnival, we want every guest's current vacation to be awesome. In the future, you won't even need to book another vacation because you can simply add an itinerary because you're already Ocean Ready. To us, it's all about maximizing the guest experience. With the Medallion, the more you engage in your vacation journey, the better it is. From the moment you first engage and even more over time, you have richer and richer experiences crafted and created just for you. It's about connecting. It's about people. And ultimately, it's all about creating happy guests.

It's not simply the Medallion, and it's not simply the Compass. There's an entire technology platform that goes behind them. There's an array of sensor types and embedded equipment that enables the Medallion to create experience magic. The technology itself that lives within the Medallion, the sensors, the readers, and the door locks is quite complex in a very small package. You have to pick the technology very carefully, so building the system not as a monolithic brittle solution but one of a constituent set of components that can be upgraded and enhanced over time. If you think about your mobile phone, you have the hardware, and then you have the operating system, and you have the apps that sit on top of the operating system. So using that as a metaphor for what we're doing, this ship is one large mobile device. And with that, we wrapped it with an operating system which is our experience platform, and then we staged all of our experiences on that platform. Right now, we have dozens of vendor partner teams of various sizes engaged. Our engineering team is in Seattle, our design team is in San Francisco, our algorithmic science teams are spread across the world. We're conducting manufacturing operations with many of the leading manufacturers in Asia, coordinated through a world-class manufacturing operations team. So at any given day, at any given hour, we're making headway in some part of the world. Welcome to the Royal Princess dry dock here in wonderful Palermo, Italy. We only have 10 days to carry out a monstrous task. So a lot of the design work has gone into producing systems and products that we can install in such a short timeframe. Some great teams are running roughly 75 miles of cable, installing almost 7,000 sensors, 650 XCDs (our experience edge computing device), and 4,030 additional guest portals scattered throughout the ship. That's a lot of work happening, but we're getting it done. We have many visionary things that are going to be a part of the Ocean experience, from innovative door locks to a magical system that will enable us to deliver delight and surprise to our guests in every moment of their vacation experience aboard our ships. There really is no one that's doing quite what we're doing here. I think that we have a tremendous amount of technology that's being brought to this ship. It's just going to be very seamless; it's going to almost be invisible, so the guests are never going to realize how much is in here. What this new technology means to me is just that ability, when it all comes together, to really connect with that guest at a totally different level. It's not just revolutionary for the cruise industry; it's going to be revolutionary for the hospitality industry, and I think it's going to be very exciting. I think the most exciting thing is the enablement of the crew that's going to take place, taking away endless amounts of paperwork and spreadsheets. The crew are going to be so relieved that it's going to take service to the next level, and that's what's going to give excellent, wonderful vacation experiences to our guests. Our teams are going to have to do a lot of planning, a lot of orchestration, a lot of preparation, a lot of manufacturing. It's only by really pushing ourselves and leaning into it that we're going to get that accelerated performance and really be able to hit a mark that's going to be exceptional.

Oh yeah, thank you. Hey everybody, well I'm delighted to be here to share with you about the Ocean Medallion. So first impressions: when you hold the Medallion, you initially notice that it's clean and sleek in design, but it's so much more than that. It is the substance behind the form. As you can see, the Medallion is the persistent identifier for each guest, just like a license plate on your car. And it is the component that connects every guest with our experience ecosystem, because connection is key. When a guest's Medallion connects with our experience ecosystem, all their dreams, all their needs can be anticipated. It's intuitive but not disruptive, personal but not invasive. And it's made up of two primary communication devices. First, you have standard BLE, which operates at distances, and standard NFC, which operates at closer range. What's unique though is that we've turned the industry equation upside down. Normally, BLE beacons are stationary and the readers are mobile. In our case, this little baby is our beacon — it is mobile — and our readers are mostly stationary. Similarly, we did a turn on the Compass, which is our digital portal to your experience. As you saw earlier in the video, it's the digital concierge with a unique user interaction. When we constructed the guest interaction, we created several different dimensions that allow different guests in the same location to have a unique experience and a unique perspective on their Compass, even though they're standing right next to each other. That's really special because the experience is differentiated for each guest, and it's all about the guest. You don't need an iPhone, an iPad, or a computer to access the Compass. It's available on any device throughout your experience and on the ship. And you can connect with it in your stateroom on your TV, with other digital portals, and even with our crew members through their own Crew Compass. When you cruise on a Medallion Class ship, your vacation experience begins the moment that you start at home, and it's amplified because of our experience ecosystem. In the center is our interaction layer, where the guest's Compass and the Medallion and the Crew Compass interact with each other simply and seamlessly, so the crew can provide personalized services no matter where you are. The experience layer is constructed of all the services that enable us to provide guests experiences throughout the ship, in our destinations, and throughout our media content. And this flexible platform allows us to continually change, add, and innovate new experiences once it's in place. It's absolutely limitless. In the next layer, we have signature services such as Ocean Ready and Ocean Concierge, which are specifically designed to deliver an exceptional guest vacation. And you know about the devices and the hardware as you saw in the video. The final layer is comprised of the experience operating system. There are also innovative components within the ecosystem infrastructure, like stateroom entry. Get this: all you have to do is walk up to your stateroom door with your Medallion and just reach out. You know, stateroom access has been elevated to the same level of luxury as keyless entry on the world's finest cars. That's exactly right. And let me share with you a little about how that amazing thing works. As you approach, your Medallion is read by the portal next to the entry of your stateroom. Then that portal sends a message back to our servers. The servers validate that it's you at the door. A confirmation zips back across the ship to your stateroom door, which also triggers your Compass. The entry portal right next to your door lets you know where your family is, what activities are coming up, and most importantly, it welcomes you to your stateroom. The LED on the door lights up to give you the right impression that it's ready. You reach out, open your door, and bing, you're in. And all of that happens in a blink of an eye. And as you can see, all of this is really happening. Our experience ecosystem is not at all hypothetical. Yeah guys, this really is happening. It's just fantastic. So I want to thank you both for all your hard work and the teams around the world, and I want to thank you, John, and you, Michael, for your creativity. But exactly, thanks back to you.

If you want to create a great guest experience, you have to create a great crew experience. You've got to give them the wherewithal to be able to stage that experience, and that includes the tools and the technology. By enhancing the guest experience, we actually can improve operational efficiency. The fact that we know who you are, we know what you want means that backstage we can improve the efficiency of how we do things, so that everything becomes more personalized. And that improves the efficiency and actually lowers the cost of the experience that you're provided. And that is fantastic. Carnival is going to be able to create a true differentiation by embracing the individual guests, becoming truly guest centric, so that they can then take the learnings from ship to ship, from brand to brand. And that's going to create this tremendous platform, and that's a singularly powerful competitive advantage.

Well, I know there are three things I see that you're really doing right. First of all, your strategy starts with the guests. Now, being guest centric is much easier said than done. In the past few years, almost everything is being labeled an experience, when most are mere products and services. True experiences create an emotional impact that could be personally transformative. And there's no doubt that by taking personalized experiences to another level, you're going to be making emotional and transformative impacts. And second, Medallion Class is an inclusive approach. Everyone can have an elevated experience. It's not about segmenting your guests and having a small portion that pays more for that elevated experience. Your strategy elevates everyone's experience, and personalization at scale — that's a game-changer. Third, it's about leverage. By staging guest experiences via a platform, your scale can be maximized by efficiently extending the platform across the brand and then across the entire fleet. The platform approach facilitates an increased focus on brand differentiation, so you're shifting your focus from the next ship to one that elevates guest experience regardless of ship size or ship age.

Don't do a one-off, right? That's the key. A platform is a strategic approach that requires commitment. It's always easier to do one awesome showcase to stage a specific experience, but ultimately easier is not cheaper, extendable, or leverageable.

We have worked on some disruptive projects, Arnold, but none as transformational and honestly as exciting and awesome as this. Look, we're all here at CES, and there isn't a day that goes by that another digital innovation is hyped about in the tech space. The reality is, most of those innovations are experiments; they're not enterprise class. So think about it: Carnival is building a platform that will be built on enterprise class technology to scale to a hundred ships floating on the open ocean, to over 740 destinations worldwide, in real time. That's not typical. That takes some serious kung fu. And Joe, we've talked a lot about personalization. Well, personalization is built on consumer information, things like guest behavior or the time of day or maybe a preference. That data needs to be secured. So Carnival is enabling technologies like tokenization and encryption, authentication, and the anonymization of all of that data is so critical. And Arnold, in a day of this world where we have a focus on corporate security, those elements have to be engineered into the very DNA of the platform at the outset, and not done as an afterthought. And as you take personalization to heart — because I love your philosophy — all right.

Arnold, I would have never imagined as CEO of Night Tech, grabbing a red-eye to Miami along with our lock, Pelican case in one hand, a bag of tools in the other, to install a prototype door lock in a stateroom door in the middle of a huge dark warehouse. I had no idea what I was getting into, but I wanted to be part of it. You know Arnold, your creative industrial design and hardware is second to none, but your cruise ships are pretty unique and that offered up a few challenges. Remember, cruise ships never sleep. There are no evenings, weekends, or even holidays where there are no guests. So we had to be pretty creative in how we performed installation and testing. Every three years you have only 10 days in dry dock to get your work done. So it was absolutely critical that the hardware be able to withstand the harshest marine environments, yet be quick and easy to install, especially in some pretty tight spaces. But most of all, it has to work the first time. Failure is not an option.

Rich, I completely agree with that, but also the business model is very unique. It includes everyone, not just a segmented group. To accomplish this level of experience personalization, the location services must be extremely robust, precise, and dependable. And Arnold, as we all know, there's a big difference between us doing something that's special and doing something special at scale. This is not just another digital innovation experiment. The experience platform serves as the backbone not only for immersive experiences but also for all operational processes, and it's been engineered for complete and total reliability.

The concept of a genius enterprise is something very new. Obviously, it contrasts directly with dumb products, which if you think about it increasingly make consumers feel stupid. I mean, how many times have you placed your hands in front of a faucet when you realize there's no sensor and you actually have to touch the handle to turn it on? Not exactly the optimal outcome. So smart products are the baseline. Smart products respond to customer requests as expected. But genius experiences anticipate what the customer wants or needs in advance and instantaneously customize the service delivery for that individual. And Arnold, this is exactly what you and your team are doing with the Medallion Class approach. It's genius.

We started thinking about new ways to communicate today's cruise experience and show the world the very best vacation experiences happen on the ocean. Enter our strategy of bringing cruise-inspired original content back to the forefront. So we began to dream, create, and produce compelling original series. Our first three series — Ocean Treks, The Voyager, and Vacation Creation — have been on the air since October first, and we're so proud of the way that we've been able to tell these stories in new and authentic ways. We are connecting the world with everything that makes an ocean vacation amazing. And this is just the beginning.

Come on, there we go, there we go. I think that we need to start this thing off Vacation Creation style with a group hug!

Each week on Vacation Creation, we create the perfect customized cruise vacation for some very lucky guests, and it is always so heartwarming to see the transformations as these guys live out their dream vacations.

That's right, we make it easy for them to just enjoy the heck out of everything. The world on your ships, visiting the best destinations. It's a really tough job. We're just always blown away by the life-changing experiences your company gives each guest.

Yep, and now with the Medallion and the Compass, Ocean will deliver Vacation Creation experiences for everyone. And that means all y'all.

That's right, that's right. Everybody, right. So thanks to Ocean, you can completely immerse yourself in unique environments, authentic cultures, and epic stories through our technology. In fact, the Medallion and Compass enable every guest to experience the same kind of adventures you'll see on all of our Ocean Media series.

Exactly. I like, for example, I don't know if you know this, but you have some great bars on your show. Yeah, most adults enjoy a good cocktail, right? This is Vegas, am I right? So how would you guys like to sail the globe drinking in the stories behind signature cocktails that push the boundaries of flavor? Well, now you can through the new Ocean original series Good Spirits. And guests on all Medallion Class ships will be able to enjoy signature cocktails inspired by places and cultures from around the world, just like the ones you'll see on the show. Good Spirits, and we'll actually take the spirits from the show and create, on the ship, the Good Spirits lounge. Check it out.

I'm Matthew, a cocktail chef. I put passion into each beverage I make. That's exactly it. It's the sum of everything. I serve needs to be a work of art. Every time I have a sip, I say something. I'm in constant pursuit of new possibilities. My mind is just exploding inside because I've tasted new things I've never had before and gained a deeper understanding of my craft. I definitely think that I could find a way to make this into a cocktail. So I've taken to the seas aboard the world's most spectacular ships, exploring amazing destinations in search of incredible people and unique spirits. This is what makes St. Lucian rum so unique and so hard to find. And farm-fresh ingredients — these are La Vaca oranges that only grow here in the island — to inspire drinks that are nothing short of magic. You feel all the flavors. It's when the party just starts. This is Good Spirits.

Good Spirits is an immersive bar experience that we're developing for Medallion Class ships. It's shaping up to be something really special: a perfect blend of immersion, experience, and personalization that can only be delivered with the Medallion. This rum, that wine, all these juices and blends, and that island — we're rooting our experience in an organic culture with authenticity. It's not about whipping up outrageous concoctions. There's an authentic connection. Good Spirits is comfortable and inviting, almost like stepping into the kitchen of a well-traveled friend. And its stories and product will revolve around the stories of the destinations that we visit. The Medallion makes those experiences personal, whether it's media and effects integrated into the room that are evocative of the drink you just ordered, or a specialty cocktail unique to you that reflects all of your tastes built with your genome in mind. You're a part of the story. Good Spirits is going to be a great bridge that allows guests to explore and connect with the culture of our destinations in a really personal way.

So Good Spirits is a great example of how we develop a ship experience from one of our Ocean Media series. And speaking of an experience from one of your Ocean Media series, we cannot end this without our ending from Vacation Creation, right? So hold up, it's selfie time.

All right, yeah. You guys ready? Bring the lipstick on. Okay, you guys are in this, seriously.

All right, so on the count of three, we're gonna say Ocean. Okay, all right. Let's get in there. Okay, one, two, three — Ocean!

As the world's largest premium cruise line, Princess Cruises is one of the best known names in vacations. Princess carries more than two million guests each year to magnificent destinations all around the world, from Alaska, Europe, Asia, and the Caribbean. You know, from the moment I first visited the Experience Innovation Center, I was inspired by the possibilities of the Medallion and the Compass and their potential to empower our crew to surprise and delight our guests. At Princess, we're renowned for our world-class guest service, and over the course of a cruise which can range from 3 to 100 days, our crew strives to get to know our guests so we can exceed their vacation expectations. But now, with the added power of the Medallion, we can understand our guests' wants, needs, and desires even better, creating personalized experiences that are meaningful and memorable, and do it all in real time. Now how will we do this? With this innovation, from the moment you first engage with us, your experience will be powered by your preferences. You'll be invited to your favorite fitness class while your best friend attends our cooking demonstration. Services you desire will be delivered seamlessly, often without asking, where and when you want them. We offer hundreds of activities a day on our cruise ships, ranging from wine tasting to blackjack, scuba diving to Zumba. You'll essentially have a personal concierge always available to make the most of every minute of your precious vacation time and make sure you're aware of all of your experience options. So I can get my soy cappuccino exactly when I want it every day. I can glance on my phone and know where my kids are on the ship at any given moment. I can also engage in the ship's casino games from my cabin while I'm waiting for my husband to get ready for dinner. That kind of experience personalization is priceless. At the end of the day, the Ocean Medallion takes vacations to an entirely new level, and Princess Cruises will be leading the way — not just for Carnival Corporation, but for the entire vacation industry — expanding the vacation market through guest centricity. For the past year, our Princess team has been working side by side with the Innovation Team to bring all of this to life. So with that, it gives me great pleasure to reveal that on November 12th, 2017, Carnival Corporation will launch Ocean Medallion Class on Princess Cruises. We will premiere the first Medallion Class ship offering this new enhanced vacation experience. You're all invited to reserve your cabins on the maiden voyage in the spring of 2018. Royal Princess, and then Caribbean Princess, will be launched as Medallion Class ships. And eventually, we expect Medallion to be implemented across the entire fleet. And of course, all of the ships in our fleet around the globe will continue delivering great experiences and exceeding our guests' expectations.