Most businesses, if they want to be successful, determine their target groups of potential customers as precisely as possible. This can be made by applying an accurately developed marketing tool named segmentation strategy (Camilleri, 2018). As a rule, the company can choose one of a decade of segmentation types, among which demographic, psychographic, socio-cultural, and SIC industry classifications are the most popular. This paper aims to demonstrate how a B2C tourism company will choose its consumer base by using segmentation strategies.
All these strategies have a similar attitude towards the customer groups dividing them into handy boxes. The distribution depends on demographical indicators like age, income, and marital status, psychographic characteristics – the intrinsic motivation and what stands behind it, socio-cultural indicators – being a part of a particular nation, race, and ethnicity, and SIC segmentation that is used to determine the market based on the industry where it operates. No less important, the companies may choose whether they will sell products or services to other businesses – the B2B companies, or to the end users – B2C companies.
The company that sells tourist trips to luxury island destinations will most likely use demographic segmentation since this strategy allows for determining the maximally distinguished customers’ portraits that characterize their preferences and spending behaviors. For instance, the demographic segmentation considers age, marital status, family status, educational status, and employment status (Gajanova et al., 2019). Since the luxury islands are rarely used as destinations by other businesses, except for probably event agencies, the mentioned tourism company will be of a B2C type, selling the trips to the end users of the service. The company may also apply the psychographic segmentation tool to enhance sales. However, setting the target customer demographic segmentation will be most handy.
Thus, it was discussed, how a company selects a segmentation strategy to identify the unique characteristics of the population segment most likely to need and purchase its offerings. The B2C tourism company will most likely choose the demographic segmentation strategy since it allows for determining a broader range of specific customer characteristics closely related to their spending behavior. The company will likely easily find its target groups by choosing among the most popular types of spenders based on demographic characteristics.
References
Camilleri, M. A. (2018). Market segmentation, targeting, and positioning. In Travel marketing, tourism economics and the airline product (pp. 69-83). Springer, Cham.
Gajanova, L., Nadanyiova, M., & Moravcikova, D. (2019). The use of demographic and psychographic segmentation to create marketing strategy of brand loyalty. Scientific Annals of Economics and Business, 66(1), 65-84.