Chapter 8
Market Segmentation,
Targeting and Positioning

Marketing for Hospitality and Tourism, 3e

1
Benefits of Segmentation
•
•
•
•

Effective use of resources
Gain a focus
Create Value for a target market
Positioning

Ma...
Steps in Market Segmentation,
Targeting, and Positioning
Market Segmentation

1. Identify bases for
segmenting the market
...
Step 1. Market Segmentation
Levels of Market Segmentation
Through Market Segmentation, Companies Divide Large, Heterogeneo...
Step 1. Market Segmentation
Geographic Segmentation
International
Accor
National

Regional/City

Marketing for Hospitality...
Step 1. Market Segmentation
Demographic Segmentation
•

Dividing the market into groups based
on variables such as:
– Age
...
Step 1. Market Segmentation
Psychographic Segmentation
Divides Buyers Into Different Groups Based on:

Marketing for Hospi...
Step 1. Market Segmentation
Behavioral Segmentation
• Dividing the market into groups
based on variables such as:
– Occasi...
Step 1. Market Segmentation
Step 1. Market Segmentation

Segments must respond differently to different marketing mix
Segm...
Evaluating Market Segments
• Segment size and growth
• Segment structural attractiveness
• Company objectives and resource...
Step 2. Market Targeting
Market Coverage Strategies
A. Undifferentiated Marketing

Company
Company
Marketing
Marketing
Mix...
Choosing a market-coverage
strategy
•
•
•
•

Company resources
Degree of product homogeneity
Market homogeneity
Competitor...
Step 3: Positioning for Competitive
Advantage
• Product’s Position - the way the product is
defined by consumers on import...
Positioning Strategies
• Positioning by specific product
attributes
• Positioning by benefits
• Positioning for user categ...
Steps to Choosing and Implementing
a Positioning Strategy
• Step 1. Identifying Possible Competitive
Advantages: Competiti...
Product Differentiation
•
•
•
•
•

Physical attributes
Service differentiation
Personnel differentiation
Location
Image di...
Which differences to promote?
•
•
•
•
•
•
•

Important to customers
Distinctive
Superior
Communicable to customers
Preempt...
Perceptual Map
Positioning
map of
service level
versus
price. Source:
Lovelock,
Services
Marketing,
Prentice Hall

Marketi...
Perceptual Map
Live shows
Easy to reach
Good food
Fantasy
Exercise
Fun rides
Disneyland

Knott’s
Berry
Farm

-1.6 -1.4 -1....
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Market Segmentation, Targeting and Positioning

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Learn more about the benefits and steps involved in Market Segmentation, Targeting and Positioning.

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  • Market Segmentation, Targeting and Positioning

    1. 1. Chapter 8 Market Segmentation, Targeting and Positioning Marketing for Hospitality and Tourism, 3e 1
    2. 2. Benefits of Segmentation • • • • Effective use of resources Gain a focus Create Value for a target market Positioning Marketing for Hospitality and Tourism, 3e 2
    3. 3. Steps in Market Segmentation, Targeting, and Positioning Market Segmentation 1. Identify bases for segmenting the market 2. Develop segment profiles Market Targeting 3. Develop measure of segment attractiveness 4. Select target segments Market Positioning 5. Develop positioning for target segments 6. Develop a marketing mix for each segment Marketing for Hospitality and Tourism, 3e 3
    4. 4. Step 1. Market Segmentation Levels of Market Segmentation Through Market Segmentation, Companies Divide Large, Heterogeneous Markets into Smaller Segments that Can be Reached More Efficiently And Effectively With Products and Services That Match Their Unique Needs. Mass Marketing Same product to all consumers (no segmentation, i. e. a commodity) Segment Marketing Different products to one or more segments (some segmentation, i.e. Marriott) Marketing for Hospitality and Tourism, 3e 4
    5. 5. Step 1. Market Segmentation Geographic Segmentation International Accor National Regional/City Marketing for Hospitality and Tourism, 3e 5
    6. 6. Step 1. Market Segmentation Demographic Segmentation • Dividing the market into groups based on variables such as: – Age – Gender – Family size or life cycle – Income – Occupation – Education – Religion – Race – Generation – Nationality Marketing for Hospitality and Tourism, 3e 6
    7. 7. Step 1. Market Segmentation Psychographic Segmentation Divides Buyers Into Different Groups Based on: Marketing for Hospitality and Tourism, 3e 7
    8. 8. Step 1. Market Segmentation Behavioral Segmentation • Dividing the market into groups based on variables such as: – Occasions – Benefits – User status – Usage rate – Loyalty status – Readiness stage – Attitude toward product Marketing for Hospitality and Tourism, 3e 8
    9. 9. Step 1. Market Segmentation Step 1. Market Segmentation Segments must respond differently to different marketing mix Segments must respond differently to different marketing mix elements & programs elements & programs Requirements for effective segmentation Requirements for effective segmentation Measurable Measurable Accessible Accessible • Size, purchasing power, profiles of segments can be measured. • Segments can be effectively reached and served. Substantial Substantial • Segments are large or profitable enough to serve. Actionable Actionable • Effective programs can be designed to attract and serve the segments. Marketing for Hospitality and Tourism, 3e 9
    10. 10. Evaluating Market Segments • Segment size and growth • Segment structural attractiveness • Company objectives and resources Marketing for Hospitality and Tourism, 3e 10
    11. 11. Step 2. Market Targeting Market Coverage Strategies A. Undifferentiated Marketing Company Company Marketing Marketing Mix Mix Company Company Marketing Mix 1 Marketing Mix 1 Company Company Marketing Mix 2 Marketing Mix 2 Company Company Marketing Mix 3 Marketing Mix 3 Company Company Marketing Marketing Mix Mix Market Market B. Differentiated Marketing Segment 1 Segment 1 Segment 2 Segment 2 Segment 3 Segment 3 C. Concentrated Marketing Segment 1 Segment 1 Segment 2 Segment 2 Segment 3 Segment 3 Marketing for Hospitality and Tourism, 3e 11
    12. 12. Choosing a market-coverage strategy • • • • Company resources Degree of product homogeneity Market homogeneity Competitors’ strategies Marketing for Hospitality and Tourism, 3e 12
    13. 13. Step 3: Positioning for Competitive Advantage • Product’s Position - the way the product is defined by consumers on important attributes the place the product occupies in consumers’ minds relative to competing products. Marketers must: – Plan positions to give their products the greatest advantage in selected target markets Marketing for Hospitality and Tourism, 3e 13
    14. 14. Positioning Strategies • Positioning by specific product attributes • Positioning by benefits • Positioning for user category • Positioning for usage occasion • Positioning against another competitors • Positioning against another product class Marketing for Hospitality and Tourism, 3e 14
    15. 15. Steps to Choosing and Implementing a Positioning Strategy • Step 1. Identifying Possible Competitive Advantages: Competitive Differentiation. • Step 2. Selecting the Right Competitive Advantage: Unique Selling Proposition (USP). • Step 3. Communicating and Delivering the Chosen Position. Marketing for Hospitality and Tourism, 3e 15
    16. 16. Product Differentiation • • • • • Physical attributes Service differentiation Personnel differentiation Location Image differentiation Marketing for Hospitality and Tourism, 3e 16
    17. 17. Which differences to promote? • • • • • • • Important to customers Distinctive Superior Communicable to customers Preemptive Affordable Profitable Marketing for Hospitality and Tourism, 3e 17
    18. 18. Perceptual Map Positioning map of service level versus price. Source: Lovelock, Services Marketing, Prentice Hall Marketing for Hospitality and Tourism, 3e 18
    19. 19. Perceptual Map Live shows Easy to reach Good food Fantasy Exercise Fun rides Disneyland Knott’s Berry Farm -1.6 -1.4 -1.2 -1.0 -0.8 -0.6 -0.4 -0.2 -0.2 Magic Mountain 1.0 Little waiting 0.8 Educational, animals Marineland 0.4 of the Japanese Pacific 0.2Deer Park 0.6 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 -0.4 -0.6 -0.8 Busch Gardens Lion Country Safari Economical Marketing for Hospitality and Tourism, 3e 19
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