Segmentation

• Buyers are highly diverse in terms of:

  • Numbers

  • Geographical location

  • Purchasing behaviors

• This diversity makes it challenging to address all their needs and preferences

• Tourism markets are not homogeneous:

  • Consumers differ significantly in their behaviors and expectations

• Companies must recognize that they cannot satisfy the needs of every buyer in the market.

  • They need to focus on specific target groups to create effective strategies

Importance of Segmentation:

• Tourism organizations must identify and segment customer groups they want to attract.

• More Further they have a detailed understanding of

  • Behavioral patterns

  • Preferences

  • Needs of the groups

• Why? This enables the creation of personalized tourist products tailored to their requirements.

Personalization and meeting expectations are essential for success in the tourism industry

Strategic segmentation Process:

• Divides the market into homogeneous groups of individuals.

  • Allows for the development of differentiated marketing strategies for each segment.

Key Benefits:

• More effective satisfaction of specific customer needs.

• More precise and efficient achievement of marketing objectives.

  
  

Most companies no longer use mass marketing but focus on specific market segments.

Steps in Segmentation Marketing

• Identification of market segments

• Selection of one or several target segments

• Development of products and marketing programs tailored (zugeschnitten) to the specific needs of each segment.

For market segments to be effective, they must meet the following criteria:

• Differentiated:

  • Each segment must be unique and distinct from others in the market. At the same time, the people within the segment should share similar needs, preferences, or behaviors.

• Identifiable:

  • The characteristics of the segment (e.g., demographics, preferences) must be easy to define and recognize. Companies need to know who belongs to a segment and why.

• Measurable:

  • Segments should be quantifiable in terms of physical units/size (e.g., number of tourists) and monetary units (e.g., average spending).

• Stable:

  • A segment must remain consistent and viable (Lebensfähig) over time, allowing companies to develop long-term strategies

• Accessible:

  • A segment should be reachable through marketing channels, and the company must be able to deliver its products or services to them effectively.

• Substantial:

  • The segment must be large enough or financially significant to justify the company’s investment in targeting it.

Market segments can be determined based on general or specific criteria:

• General Criteria:

  Apply to broad populations and are not tied to how people use or buy a specific product/service.

• Useful for creating a general understanding of different groups, regardless of the tourism service or product involved.

  • Examples:

    • Demographics: Age, gender, income, family size.

    • Geographics: Country, region, climate.

  • Independent of the purchase and usage process.

  • Can be used to segment any population.

• Specific Criteria:

• Directly linked to the customer's interaction with a particular product or service.

• Focus on how and why people use or buy something.

  • Examples:

    • Behavioral: Frequency of travel, loyalty, or purchasing patterns.

    • Psychographics: Preferences, motivations for travel, or attitudes toward certain destinations.

  • Related to the usage of the product/service and its purchasing process.

Both general and specific criteria can be further classified as:

• Objective:

  • Measurable, fact-based, and quantifiable.

  • Examples: Age, income, number of trips taken, or nights spent at a hotel.

• Subjective:

  • Based on opinions, emotions, or personal preferences.

  • Examples: A traveler’s desire for adventure, luxury, or relaxation.