Tourism Market & Segmentation PDF

HIGHLIGHTS OF CHAPTER 1 Tourism is one of the world’s leading industries. Tourism is not a single product; it is a combination of product and service resulting to holistic experience Tourism products have unique characteristics: intangible, inseparable, variable, perishable, se...

HIGHLIGHTS OF CHAPTER 1 Tourism is one of the world’s leading industries. Tourism is not a single product; it is a combination of product and service resulting to holistic experience Tourism products have unique characteristics: intangible, inseparable, variable, perishable, seasonal, substitutable and high involvement product The core marketing functions include: marketing information management, financing, pricing, promotion, product/service management, distribution and selling The integrated marketing communications makes use of all forms of promotion to achieve maximum impact while maintaining consistent. image 6/24/21 HM6 Tourism and Hospitality Marketing 1  HM6 Tourism and Hospitality Marketing TOURISM MARKET & SEGMENTATION Aristeo C. Cueto Faculty, CITHM  OBJECTIVES At the end of the lesson, the students should be able to: Define what market is; State the three steps to target marketing; Identify the characteristics of a good market segment; Discuss market coverage strategies and positioning; and Distinguish the new and emerging markets in the Philippines 6/24/21 HM6 Tourism and Hospitality Marketing 3  WHAT IS A MARKET? In its original meaning, its a arket was am physical place where buyers and sellers gathered to exchange goods or services. 6/24/21 HM6 Tourism and Hospitality Marketing 4  To an economist: Market is all the buyers and sellers who transact for a good or service. 6/24/21 HM6 Tourism and Hospitality Marketing 5  Market A market is the set of all actual and potential buyers of a product. 6/24/21 HM6 Tourism and Hospitality Marketing 6  “Niche” market 6/24/21 HM6 Tourism and Hospitality Marketing 7  Target Marketing - Market segmentation - Market targeting - Market positioning 6/24/21 HM6 Tourism and Hospitality Marketing 8  THREE STEPS OF THE TARGET MARKETING PROCESS Market Segmentation The process of dividing a market into distinct groups of buyers who might require separate products and/or marketing mixes 6/24/21 HM6 Tourism and Hospitality Marketing 9  CHARACTERISTICS OF A MARKET SEGMENT Identifiable Cohesive Measurable Accessible Substantial Actionable 6/24/21 HM6 Tourism and Hospitality Marketing 10 Variables to Segment Consumer Markets 6/24/21 HM6 Tourism and Hospitality Marketing 11  VARIABLES FOR SEGMENTATION Geographic segmentation dividing the market into different geographic units 6/24/21 HM6 Tourism and Hospitality Marketing 12  VARIABLES FOR SEGMENTATION Demographic segmentation consists of dividing the market into groups based on demographic variables such as age, gender, family life cycle, income, occupation, education, religion, race and nationality. 6/24/21 HM6 Tourism and Hospitality Marketing 13  VARIABLES FOR SEGMENTATION Psychographic segmentation Divides buyers into different groups based on social class, lifestyle, and personality 6/24/21 HM6 Tourism and Hospitality Marketing 14  VARIABLES FOR SEGMENTATION Behavior segmentation Divides buyers into groups based on their knowledge, attitude, use, or response to a product. 6/24/21 HM6 Tourism and Hospitality Marketing 15  VARIABLES FOR SEGMENTATION Technographic segmentation allows you to organize prospects by their technology ownership and usage 6/24/21 HM6 Tourism and Hospitality Marketing 16  MARKET TARGETING Selection of the most attractive segment or segments to serve as targets for marketing strategies to achieve desired objectives 6/24/21 HM6 Tourism and Hospitality Marketing 17  EVALUATING TARGET MARKET Segment size and growth Companies will analyze the segment size and growth and choose the segment that provides the best opportunity Segment structural attractiveness A company must examine major structural factors that affect long run segment attractiveness Company objectives and resources The company must consider its own objectives and resources in relation to a market segment 6/24/21 HM6 Tourism and Hospitality Marketing 18  MARKET COVERAGE STRATEGIES 6/24/21 HM6 Tourism and Hospitality Marketing 19  MARKET COVERAGE STRATEGIES 1. Undifferentiated marketing strategy An undifferentiated marketing strategy ignores market segmentation differences and goes after the whole market with one market offer 6/24/21 HM6 Tourism and Hospitality Marketing 20  MARKET COVERAGE STRATEGIES. Differentiatedmarketing strategy The firm targets several market segments and designs separate offers for each. 6/24/21 HM6 Tourism and Hospitality Marketing 21  MARKET COVERAGE STRATEGIES. Concentrated marketing strategy Concentrated marketing strategy is especially appealing to companies with limited resources; instead of going for a small share of a large market, the firm pursues a large share of one or more small markets. 6/24/21 HM6 Tourism and Hospitality Marketing 22  MARKET COVERAGE STRATEGIES Micro Marketing products or services are marketed directly to a targeted group of customers. 6/24/21 HM6 Tourism and Hospitality Marketing 23  CHOOSING MARKET COVERAGE STRATEGY Company resources When the company’s resources are limited, concentrated marketing makes the most sense 6/24/21 HM6 Tourism and Hospitality Marketing 24  CHOOSING MARKET COVERAGE STRATEGY Degree of product homogeneity Undifferentiated marketing is more suited for homogenous products. Products that can vary in design, such as restaurants and hotels, are more suited to differentiation or concentration 6/24/21 HM6 Tourism and Hospitality Marketing 25  CHOOSING MARKET COVERAGE STRATEGY Market homogeneity If buyers have the same tastes; buy a product in the same amounts, and react the same way to marketing efforts, undifferentiated marketing is appropriate. 6/24/21 HM6 Tourism and Hospitality Marketing 26  CHOOSING MARKET COVERAGE STRATEGY Competitor’s strategies When competitors use segmentation, undifferentiated marketing can be suicidal. When competitors use undifferentiated marketing, a firm can gain an advantage by using differentiated or concentrated marketing 6/24/21 HM6 Tourism and Hospitality Marketing 27  MARKET POSITIONING A product’s position is the way the products is define by consumers on important attributes – the place, the product occupies in consumers’ minds relative to competing products. 6/24/21 HM6 Tourism and Hospitality Marketing 28  POSITIONING CONCEPTS Unique selling proposition (USP) Identify what makes the product or service different from others; physical attributes, added services, personnel, location, or image 6/24/21 HM6 Tourism and Hospitality Marketing 29  POSITIONING CONCEPTS Competitive advantage The advantage over competitors, gained by offering greater value either by offering lower prices or providing more benefits to justify higher prices. 6/24/21 HM6 Tourism and Hospitality Marketing 30  POSITIONING CONCEPTS Top of mind The highest level of recall that a brand receives 6/24/21 HM6 Tourism and Hospitality Marketing 31 POSITIONING STRATEGIES a. Specific product attributes Price and product features can be used to position a product 6/24/21 HM6 Tourism and Hospitality Marketing 32 POSITIONING STRATEGIES b. Needs products fill or benefits products offer Marketers can position products by the needs that they fill or the benefits that they offer. For example, a restaurant can be positioned as a fun place. 6/24/21 HM6 Tourism and Hospitality Marketing 33 POSITIONING STRATEGIES c. Certain classes of users Marketers can also position for certain classes of users, such as a hotel advertising itself as women’s hotel. 6/24/21 HM6 Tourism and Hospitality Marketing 34 POSITIONING STRATEGIES d. Against an existing competitor A product can be positioned against an existing competitor. 6/24/21 HM6 Tourism and Hospitality Marketing 35  NEW AND EMERGING MARKET Factor affecting the growth of Tourism Market 1. Economic growth in major source markets 2. Increase in disposable leisure time and longer life expectancy with a sound health to travel 3. Changes in living condition; city dwellers more inclined to engage in tourism 4. Raising educational levels and increased access to information; stimulated curiosity 5. Increasing international integration of life 6/24/21 HM6 Tourism and Hospitality Marketing 36  NEW AND EMERGING MARKET Growth in the Tourism Supply 1. Development of and investment in infrastructure 2. Continuous tourism product development 3. Elimination of legal limitations on and practical obstacles to travel 6/24/21 HM6 Tourism and Hospitality Marketing 37  TYPES OF EMERGING MARKET FAMILY MARKET Joint decision-making families Husband making the decision Wife making the decison 6/24/21 HM6 Tourism and Hospitality Marketing 38  TYPES OF EMERGING MARKET SENIOR MARKET Silver market or third-age tourism 6/24/21 HM6 Tourism and Hospitality Marketing 39  TYPES OF EMERGING MARKET YOUTH MARKET 6/24/21 HM6 Tourism and Hospitality Marketing 40 TYPES OF EMERGING MARKET MICE MARKET & BUSINESS TOURISM 6/24/21 HM6 Tourism and Hospitality Marketing 41  HIGHLIGHTS OF CHAPTER 2 A market is a set of actual and potential buyers of a product. Three steps in target marketing: market segmentation, market targeting and market positioning. A market segment has to be identifiable, cohesive, measurable, accessible, substantial, and actionable. Variables for market segmentation: geographic, demographic, psychographic, behavioral, and technographic. 6/24/21 HM6 Tourism and Hospitality Marketing 42  HIGHLIGHTS OF CHAPTER 2 Factors for evaluating market segment: segment size and growth, segment structured attractiveness, and company objectives and resources. Market coverage strategies: undifferentiated, differentiated, concentrated, and micro-marketing Market positioning concepts: unique selling proposition (USP), competitive advantage, and top of mind. New and emerging markets include the family market, the senior market, the youth market , and the MICE market. 6/24/21 HM6 Tourism and Hospitality Marketing 43  -END- 6/24/21 HM6 Tourism and Hospitality Marketing 44