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In This Section >> Changing Strategies for A Changed Time | 5 Traits of Successful Marketers | Think Positive | Preparing for the Next Crisis | Segments of the Market | The Rediscovery of Mexico City | Stop Wasting Your Money on the Web |

Segments of the Market

 

Segments of the Market

By Robert Christie Mill

“In the post-1945 world, the tourist market became segmented; in the American West, nearly every resort and most national parks had options to suit almost every budget, especially in the places where an off-season remained.”

- Hal K. Rothman Devil’s Bargains

Motivation

Early attempts to define the U.S. travel market used the stated motivation as the basis for the segmentation. One national probability sample divided the U.S. market into six segments using benefits/motivations.

The segments are:

• Friends and Relatives – Non-active Visitor. Representing 29 percent of the market, these travelers look for familiar surroundings where they visit friends and relatives. They tend not to participate in any activity.

• Friends and Relatives – Active City Visitor. An additional 12 percent of the population also seeks out the familiar where they visit friends and relatives. However, this group is more inclined to do such things as sightsee, shop, and engage in cultural activities.

• Family Sightseers. Six percent of the market looks for new vacation places that would entertain and enrich their children.

• Outdoor vacationers. The nineteen percent who fall into this category want clear air, rest and quiet, and beautiful scenery. Recreation facilities are important for the numerous campers who are part of this segment. Children are also important.

• Resort Vacationers. A similar percent – nineteen – fall into this category. They are primarily interested in water sports and good weather. Popular places with a big city atmosphere are preferred.

• Foreign vacationers. Over a quarter – 26 percent – consist of people who seek destinations they have never been to before. A foreign atmosphere offering an exciting and enriching atmosphere with beautiful scenery is important. Good accommodations and service are more important than the cost.

Behavior

More recently it has been suggested that segmentation on the basis of actual behavior is a better reflection of the market. It has been found that what people say they want is not necessarily what they actually do. A recent study, representative of the U.S. population identifies three major market segments.

1. Get Away/Family Travelers represents almost 38 percent of the total and is similar to the Friends and Relatives – Non-active, Family Sightseers, and Outdoor Vacationers noted above. They tend to visit places that are:

• A good place for children
• Where friends and family live
• Scenic
• Places they can rest and relax
• Full of friendly residents
• Within driving distance
• Places where they can learn new things
• Safe
• Good mountain areas
• Congestion-free

On the other hand it is unimportant to them that the vacation destination is popular, that inclusive packages are available, or that a number of differently-priced accommodations is available.

2. Adventurous/Educational Travelers make up 31 percent of the market. This segment is similar to the Foreign Vacationers noted above. They tend to engage in cultural activities such as visiting museums, galleries, opera and theater. More than two thirds visit places that:

• Someone else they knew had been to
• Offers a number of things to see and do
• Is a famous city/place
• Has elegant dining
• Offers a full range of hotel accommodation.

They are less concerned with rest and relaxation, friendly locals, crime, congestion, clean air, and cost.

3. Gamblers/fun travelers represent just under 30 percent of the market and are linked to the Resort Vacationers in the previously mentioned study. They want a highly popular place where they can gamble, participate in recreation or sport, enjoy a good night life and fine dining. They are also concerned about price, the availability of good beaches, sunbathing, and good weather. On the other hand, they are less concerned about cultural activities, being close to friends and relatives (while on vacation), and the presence of amusement parks.

TravelScope, a national survey, estimates that nine percent of travelers gambled. In 1994 American households made 125 million visits to casinos, spending $16.5 billion.

Trends in the Luxury Market

Recent research on the affluent market indicates various trends in upscale travel that have implications for resorts. The LuxeReport is a compilation of more than 3,500 survey responses from travel consultants serving affluent clients who spend an average of $6,000 per person, per trip.

Among this market in general, and among clients age 34 to 52, the following trends are on the rise:

• Adventure travel – 35% all; 22% age 34-52
• Traveling with children – 24% all; 11% age 34-52
• Educational travel – 10% all
• More frequent, shorter trips – 9% all; 7% age 34-52
• Spa vacations – 7% all
• Cruises (especially top luxury and expedition) – 31% all
• Biking and walking trips abroad – 7% all

 

SOURCES

1. Shirley Young, Leland Ott, and Barbara Feigin, “Some Practical Considerations in Market Segmentation,” Journal of Marketing Research, 15, 1978, pp. 405-42.
2. Stowe Shoemaker, “Segmenting the U.S. Travel Market According to Benefits Realized,” Journal of Travel Research, Vol. XXXII, No. 3, Winter 1994, pp. 8-21.
3. “What’s Hot – and What’s Not – in the Luxury Market,” Travel Weekly, April 29, 1999, p. 56.

This article is adapted from Resorts: Management and Operation (New York, N.Y., John Wiley & Sons, Inc., 2001 by Robert Christie Mill)

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