CHAP 2 The Tourist Market and Segmentation - Practice Flashcards

A complete set of vocabulary flashcards covering the concepts of market segmentation, targeting, positioning, and specific emerging tourist markets based on the Chapter $$2$$ lecture notes.

Market

• A set of actual and potential buyers of a product

• who share a particular need or one that can be satisfied through exchange relationships (Kotler et al, $2010$).

Market segmentation, targeting, and positioning

• Are key terms useful in any marketing process. Identifying one’s market segment will help in identifying the market’s needs and wants.

Market Segmentation

A subgroup of the total consumer market who share similar characteristics and the needs relevant to the purchase of a product, service, or experience.

Characteristics of a market segment
Lumsdon (1997)

1. Identifiable

2. Cohesive

3. Measurable

4. Accessible

5. Substantial

6. Actionable

Identifiable

• the people who comprise the segment can be located and recognized such that targeting them would be easy.

Cohesive

• consumers should be part of a whole whose specific qualities are common to all.

Measurable

• the marketer should be able to estimate the size and potential spending of the member of the market segment.

Accessible

• the member of the segment should be accessed by marketing efforts and promotional activities to be conducted.

Substantial

• market segments should be large enough to be considered.

Actionable

• the company has enough resources and commitment to enable effective penetration of the identified segments to ensure effective positioning.

VARIABLES OF SEGMENTATION

• Geographic

• Demographic

• Psychographic

• Behavioral

• Technographics

Geographic (Segmentation)

Divides the market into different units such as nations, states, regions, countries, cities, neighborhoods, Barangays, or towns.

Demographic (Segmentation)

Segmenting the market based on variables such as age, lifecycle, gender, income, occupation, education, religion, and race.

Psychographic (Segmentation)

Divides consumers based on different profiles such as social class, lifestyle, and personality characteristics.

Behavioral (Segmentation)

Dividing groups based on their knowledge, attitude, use of, or response to a product or services.

Special Location Segmentation

• A sub-type of behavioral segmentation involving purchases made based on occasions such as Mother’s Day, Valentines Day, honeymoon, anniversary, or birthday.

Benefit Sought

• factors such as quality, ambiance, new variety, and price.

User Status

• refers to market segmented based on usage of products such as first-time users, regular users, non-users, and potential users.

Usage Rate

Refers to frequency of usage, categorized as light, medium, and heavy users.

Loyalty Status

refers to the degree by which customers are loyal to the brand.

Buyer Readiness

Pertains to the different stages buyers’ become ready to purchase a product.

Technographics/Cooper ($2006$)

• A fifth variable for market segmentation stated by _________.

• It is with the advent of the internet that market can also be categorized as users or non- users of technology

Market Targeting

Evaluating each segment’s attractiveness and selecting one or more of these market segments in which to operate one’s business.

Segment Size

• referring to current sales volume, growth rate, and high profit margin.

Attractiveness

• referring to the potential impact of the segment to the company.

Company objectives and availability of resources

• refer to the main reasons for its decision- making and available resources the company will use to make its objectives are reality.

 

Market Coverage

The evaluation of a total market and choice of how many and which market segments a company decides to target with its products or services.

3 market coverage strategies

• undifferentiated marketing

• differentiated marketing

• concentrated marketing

Undifferentiated Marketing

• a company ignores market segmentation and goes after the entire market with only one market offer.

Differentiated Marketing

• approaches the market by targeting several market segments using separate offers per segment.

Concentrated Marketing

• it pursues getting a big share of a small market rather than a small share of a large market.

Factors to be considered in choosing market coverage strategies

• Company Resources

• Degree of Product homogeneity

• Market Homogeneity

• Competitor’s Strategy

Company Resources

• this refers to how much money and resources the company has which be allocated to marketing.

   

Degree of Product Homogeneity

Refers to products that are standardized and identical.

Market Homogeneity

• refers to the degree to which buyers in a total market share similar characteristics, tastes, preferences, purchasing behaviors, and responses to marketing efforts.

Competitor’s Strategy

• it is important to assess the strategic competitors are using so that the correct strategy can be implemented to counter their marketing efforts.

Market Positioning

Developing competitive positioning for a product and an appropriate marketing mix.

Unique Selling Position

• A term used to identify what makes a product or service different from others.

• This might occur due to the product’s physical attributes, added services, personnel, location, or image.

Competitive Advantage

A product’s advantage over competitors gained by offering greater value, either by lower prices or more benefits to justify higher prices.

Top of Mind

The highest level of recall that a brand receives.

Some positioning strategies include the following:

1.Specific product attributes such as price and special feature can be used to position a product

2.The product can also be positioned based on its benefits and the needs the product fills. 

3.Positioning the product based on certain classes or segments of users can also be done.

4.A company can decide to position itself against an existing competitor and present its edge over said competitor.

New and Emerging Market

A group of travelers or a destination region experiencing rapid growth, developing new travel behaviors, or gaining initial popularity.

Types of Markets:

• The Family Market

• The Senior Market

• The Youth Market

three types of vacation decisionmakers within the family market:

• Joint decision-making families

• Husband makes the decision

• Wife makes the decision

Joint Decision-making Families

• take land trips with a longer period and utilize the widest range of information sources.

Husband makes the decision

• characterized by spouses with greater age differences

• Husband dominated families spent the largest amount of money.

  
  
  

Wife makes the decision

• It is characterized by short planning duration and uses the fewest information sources for planning.

• This type of families spends the least amount of money and shortest duration

 

Senior Market

A market also known as the silver market or third age tourism.

Youth Market

• experience-seekers who collect unique experiences to build self-identity narratives.

The MICE market and business tourism

• The meetings, incentives, conferences, and exhibitions industry is extensively and rapidly growing.

• Collectively known as the events industry, this type of travel is connected but not limited to business travel.