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transcript
Chapter Thirteen
Differentiation, Segmentation and Target Marketing
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Differentiation Distinguishing your product or
service from the competition in ways that are both identifiable and meaningful for the customer
The customer should perceive a greater value
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Differentiation Differentiation is effective when:
It cannot be easily copied It appeals to a particular need or
want It creates an image or impression
that goes beyond the specific difference itself
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Exhibit 13-2; Ritz-Carlton tangibilizing the intangible
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Differentiation Differentiation as a marketing
tool Helps create awareness and trial by
the customer Sometimes product differentiation is
the only thing a firm can do It is much easier to do in the
foodservice environment, even within hotels
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Differentiation Differentiation -- of anything
Can be product, message or brand specific
Difficult to achieve in hospitality because of the variety of services offered
Separates product classes and products within the same class
Provides an opportunity to strengthen competitive strategy
Is the basis for positioning strategy
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Market Segmentation Market segmentation:
Is a complimentary strategy to differentiation
Is dividing a market into meaningful groups who have similar wants and needs (market segments)
Starts with the customer
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Market Segmentation Which comes first: differentiation or
segmentation? Both happen in combination at different
times Both are part of the marketing concept First know how people differ Then segment them accordingly Develop products that meet their specific
wants and needs Creating these two strategies are major
reason to study consumer behavior
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Market Segmentation The process:
Step one: Needs and wants of the marketplace
Step two: Projecting wants and needs into potential markets
Step three: Matching the market and capabilities
Step four: Segmenting the market Step five: Selecting target markets from
identified segments
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Segmenting Variables Various ways in which a market can be
divided, or segmented, into meaningful groups of buyers
Geographic Demographic Psychographic Usage Benefit Price
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Geographic Segmentation Most widely used in restaurant and
hotel industry These segments then become easier
to reach Direct mail Media Data and information on demographics
Metropolitan statistical areas (MSAs) Defining large metropolitan areas in
terms of supposed economic boundaries Designated market area (DMA)
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Demographic Segmentation Widely used because easy to
measure and classify Does not necessarily distinguish
wants and needs Demographic lines are now
blurred Useful demographics
Age Family life cycle stage
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Psychographic Segmentation Based on activities, interests, and
opinions (AIO), self-concepts and lifestyle behaviors
Lifestyle patterns combines demographics with the way people live, think and behave in their everyday lives and correlate them into homogeneous categories
A rich area for marketing effectiveness for the hospitality industry
PRIZM and VALS
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Exhibit 13-6; VALS framework
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Usage Segmentation Umbrella term that covers a wide range of
categories Purpose Frequency Monetary value Recency RFM Timing Nature of the purchase Where they go Purchase occasion Heavy, medium or light
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Benefit Segmentation May be the most basic and most predictable of
all segments Benefits are very related to need satisfaction Benefits
Comfort Prestige Low price Recognition Attention Romance Quiet Safety
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Price Segmentation A form of benefit segmentation,
only more visible and more tangible
Price segments within a product class
Price segments between product classes
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Segmentation Strategies There will be many segments, some
with overlap, and different strategies for each segment
The test of a segment is their different behavior
Segments change over time Market segmentation has become
increasingly critical with competition Segmentation will remain a key
competitive strategy within the product class
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Target Marketing Selecting specific market segments to
target and designing the product or service to meet their specific wants or needs
More refined segmenting rules apply Strategies:
Undifferentiated targeting market strategy Strong targeting strategy Differentiated multi-target marketing
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Mass Customization The concept that modern
technology is bringing us closer to target markets of one
Make one product and personalize the product to their specifications
Largely due to databases that track customer behavior
© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Marketing Essentials in Hospitality and Tourism: Foundations and Practices by Shoemaker & Shaw
Discussion Which comes first: differentiation
or segmentation? Why?