Market segmentation is the process of dividing an entire market into smaller groups with relatively similar product requirements, so a specific marketing approach can be developed to meet these needs. In terms of market segmentation, the marketing plan is designed to attract a well-defined market or consumer group. The target marketing strategy is based on the concept that using a focused approach has been more profitable in a particularly often narrow market segment.
Market Segmentation recognizes that people differ in their tastes, needs, attitudes, lifestyles, family size, and composition, etc… “It is a deliberate policy of maximizing demand by directing marketing efforts at significant sub-groups of customers of consumers” (Chisnall, 1985: 264). Segments can be based on demographic, geographic, photographic, and behavioral.
i? Demographic market segmentation
Demographic market segmentation is one of the most commonly used methods in market segments. With this strategy, a company can divide the entire market into smaller groups based on several well-defined characteristics. Understanding demographics is crucial for the development and segmentation of products or services, especially in understanding market trends.Demography includes the study of age, race, sex, education, marital status, family status, life cycle, education, income, and occupation are among includes the study about demographics.
All of this can used to be an excellent tool for a Destination Management Company or a Travel Board to attract more tourists and travelers to their country.For example, 500 college students in Taiwan, Yu (2010) found 6 factors influencing the students’ intention to travel to the United States for sports tourism. These factors include cost and ease of arranging travel plans, interest in professional sports, different cultural experience, interest in travel, the experience of watching live sports events and the chance to see Asian players or famous United States players in the games.
ii. Geographical market segmentation
Geographical market segmentation means that tourist markets are segmented according to the geographic location of tourists, and enterprises will investigate the characteristics of each market segment from different geographical perspectives. The market needs to be divided into different geographical units, for example, the tourism market is divided into different market segments by regions, countries, regions, cities, villages, climate and spatial distance. The main theoretical basis is: Tourists in different geographical locations have different needs and preferences for the products of the enterprises, and different responses to the marketing strategies and marketing strategies adopted by the enterprises.
For example, Mount Kinabalu, the highest peak in Southeast Asia, is located in Sabah, Sabah, in the state of North Borneo. With an elevation of 4095.2 meters and still growing at a rate of 0.5 centimeters per year. The highest mountain, the granite peak straight into the sky, towering spectacular, is the new challenge for mountain climbers in Southeast Asia. It is not only known for the mountain, but also to the lush forests, precious natural resources and the world-famous environment. Its ecological protection is very good here. Its special geographical structure, with more than 4,000 plants, including tropical plants from low altitude to high altitude tropical plants, is a rare plant ecology meeting place in the world. In 2000, it was approved by the UN, UNESCO is listed as a World Natural Heritage Site. Nowadays, Mount Kinabalu is a world-famous mountain destination, with peaks of over 4,000 meters relatively easy to climb and its spectacular scenery, attracting tens of thousands of mountain climbers each year from around the world.
iii. Psycographic market segmentation
Psycographic market segmentation divides the market into groups based on the lifestyle of the customers, and it considers a number of potential influences on buying behavior, including consumer attitudes, expectations and activities. The purpose of the visit classification is to enable the destination to identify the nature of the visitor and to plan the activity accordingly. It can also determine the geographical or seasonal variation in the tourism sector by purpose. Behavioral variables such as behavioral goals, timing, benefits, user status, usage, loyalty and more are crucial starting point for segmenting markets. Various segments like, backpacker tourism, spa and wellness tourism, beach tourism, golf tourism, adventure tourism and other such sub segments.
For example, For those who like to travel with full of excitement and challenge, Malaysia’s national parks are ideal for hiking, river rafting, wildlife watching and adventures above and below ground. There are incredible outdoor adventures here such as explore the caves at the Gunung Mulu National Park or have water adventures in Endau Rompin National Park.
iii. Behavioral market segmentation
Behavioral market segmentation is important criteria for market segments. It is also observed in the marketing and segmenting of the destination with a focus on social-status and occasions. Is in accordance with the tourist lifestyle, attitude, personality and other psychological factors divide the tourism market. The desires, needs and purchases of tourists are affected not only by the cultural statistics, but also by the psychological factors. People in the same demographic group may exhibit very different psychological characteristics. Business groups segment the travel market into different segments.
Lifestyle refers to how people spend their time (activity), what they think is more important (interesting), what they think about themselves toward the environment. Lifestyle is a pattern of people living and spending time and money, and is an important factor that influences the desire and needs of tourists. At present, more and more enterprises break down the tourism market, according to the different life styles of tourists, and design different products and arrange marketing combinations for different lifestyle groups of tourists. For examples, tourists with strong family values tend to be more family-oriented when traveling while the business-minded tourists are traveling on official business, study tours mainly.