1. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Chapter 7 Marketing Strategy: Market Segmentation and Trends

2. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Market Segmentation The division of the overall market for a service into groups of people with common characteristics

3. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Market Segmentation Analysis Steps Step 1: Segmenting the market—dividing the overall market into subgroups using one or more factors Step 2: Selecting target markets— selecting those market segments that the organization is best able to serve and appeal to

4. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Benefits of Market Segmentation 1. More effective use of marketing dollars 2. Clearer understanding of the needs and wants of selected customer groups 3. More effective positioning 4. Greater precision in selecting promotional vehicles and techniques

5. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Eight Criteria for Effective Segmentation measurable substantial accessible defensible durable competitive homogeneous compatible : The target markets must be:

6. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Segmentation Approaches Depends on number of bases (factors) applied: Single-stage segmentation (one base) Two-stage segmentation (two bases) Multistage segmentation (three or more bases)

7. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Customer Trends: Changes in Demand

8. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Hospitality and Travel Industry Overall Trends More horizontal integrationMore vertical integrationNew services, facilities, and travel alternativesIncreased importance of the InternetIncreased level of competition

9. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Hospitality and Travel Industry Trends: Changes by 8 Ps Product Partnership People Packaging Programming Place (distribution) Promotion Pricing

10. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Figure 7.13A Trends in supplier and carrier sectors.

11. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Figure 7.13B Trends in supplier and carrier sectors (continued).

12. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Figure 7.13C Trends in travel trade intermediary and DMO sectors.

13. Copyright 2010 Delmar, a part of Cengage Learning. All Rights Reserved. H O S P I T A L I T Y & T R A V E L M A R K E T I N G & T R A V E L M A R K E T I N G Figure 7.13C Trends in travel trade intermediary and DMO sectors (continued).