Segmenting the Tourism Market

by Paul Williams
Nov 2008
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Summary

This article sheds light on the crucial role segmentation plays in an effective marketing strategy, explaining the various classical segmentation techniques, including commercial models available. After considering their advantages and drawbacks, it looks at the advantages of multivariable segmentation. Finally, the Ark Leisure segmentation model, very popular with many public sector tourism organisations, attractions and tourism consultancies, is considered.

For more than 25 years segmentation has been proclaimed to be the cornerstone of successful marketing. Ever since the publication of Theodore Levitt’s seminal text, The Marketing Imagination in 1983 [1], segmentation has continued to be promoted as the sine qua non of successful marketing. Levitt’s original assertion that ‘if you’re not thinking segments, you’re not thinking marketing’ has clearly stood the test of time.

Put simply, segmentation is critical to competitive advantage and should underpin every decision that needs to be made about all aspects of the tourism marketing mix. A real tourism marketing strategy needs to start with the tourist visitor, not the destination or product. It is clear that the visitor market, by definition, is not homogenous and every visitor or potential visitor does not want the same thing. This immediately gives rise to a segmentation issue.

The recognition that the needs and requirements of the visitor market are heterogeneous rather than homogenous should then become the starting point in developing value propositions that are unambiguously targeted at distinct and identifiable groups of visitors who are all similarly motivated in their decision to visit a destination.

Implementing a tourism marketing plan based on needs-based segmentation is difficult, but not impossible. Yet, many destinations have still not developed effective segmentation strategies, largely because many of the conventional techniques are no longer suitable for an increasingly sophisticated, discerning and fragmented tourism market.

Traditional marketing theory emphasises the importance of actively managing the segmentation, targeting and positioning process to inform the way in which tourism organisations implement the marketing concept and satisfy visitors and other tourism consumer needs successfully. In other words, segmentation aims to provide tourism organisations with a commercially viable method of understanding their markets and developing strategies for serving their consumers.

A tourism market consists of all those people with sufficient motivation, ability and opportunity to visit a destination or attraction. Market segmentation is a consumer-led technique that involves dividing the market into groups of like-minded people with similar needs, and behavioural characteristics and who therefore require similar tourism marketing mixes.

The more finely segmented the market, the greater the likelihood that the destination or attraction will be able to implement targeted marketing campaigns to usable, distinct groups of visitors rather than randomly marketing to the market generally. Market segmentation, therefore, has significant implications for the determination of tourism marketing strategy.

Whereas segmentation should be about trying to decide which factors or variables have the most influence on visitor behaviour, in practice what most people call segments are simply classifications. Moreover, segmentation can be:

  • a priori – where the criterion used to divide the market is already known or
  • a posteriori – where no such prior knowledge exists.

Evidence suggests that many destinations and attractions still favour an a priori segmentation approach using easily obtainable geographic or demographic information. Given that this method of segmentation has been referred to by Professor Malcolm McDonald [2] as being ‘as useful as a bird of prey with a squint’, its relevance clearly is questionable in today’s aggressively competitive tourism market.

More encouragingly, the most successful and contemporary UK destinations have now started to develop segmentation strategies based on visitor motivations and attitudes rather than being drawn down the conventional route of inward-looking, simple classifications. Before examining these innovative applications of data-driven multidimensional segmentation, it is useful to briefly review the conventional criteria used to segment markets.

In an article published in Insights in July 1998, Susan Horner and John Swarbrooke [3] critically examined the four classic market segmentation techniques. A summary of the advantages and disadvantages of these basic techniques is provided in Figure 1.

Geographical

At a basic level, defines tourist consumers according to their geographic location on the assumption that behaviour is influenced by where people live.

Demographic

Attempts to define tourist consumers’ behaviour in relation to age, sex, family lifecycle stage, social class, income and other such criteria.

Psychographic

Assumes that tourist’s purchasing behaviour is related to their personality or lifestyle.

Behaviouristic

Focuses on tourist’s behaviour in relation to a particular tourism product, and attempts to segment the market based on differences in behaviour, for example the benefits sought, buying patterns and trends, or degree of loyalty.

Tourism markets can be segmented in a variety of ways. Each of the four basic techniques – geographic, demographic, psychographic and behaviouristic possess a number of advantages and disadvantages. Between them, they incorporate a wide range of descriptive, measurable, tangible and intangible characteristics.

The use of geographic and demographic segmentation methods as a basis for differentiating marketing strategies has traditionally been advocated by regional or demographic variations in tourist behaviour. These methods are a useful starting point for those tourism organisations constrained by limited resources to gain a better understanding of their market.

They are relatively easy to define and measure and the data used to help segment the market is often freely available from public sources. In this respect they do provide a clear if rather restricted profile of visitors and other tourism consumers that could be used to develop marketing strategies such as deciding where and how to promote tourism products.

However, these techniques have various drawbacks.

  • They are often seen as being dated and unsophisticated, partly because they rely heavily on quantitative and factual data to make general assumptions which are then used to try to explain tourist behaviour.
  • They also lead to significant stereotyping that usually covers up or masks important variations in tourist behaviour. Not only do these techniques ignore other key influences on behaviour, they do not consider the wide variation in tourists’ needs and wants even in small geographic areas or demographic groupings.

Yet many destinations, attractions and tourism supplier organisations still place great emphasis on geographic and demographic segmentation, which Horner and Swarbrooke (1998) referred to as ‘yesterday’s techniques’ over a decade ago. In order to produce a more detailed profile of potential markets it is clear that the real benefit of adopting a geographic and demographic segmentation approach is as a foundation for other more tourist-focused methods.

Geodemographic segmentation may be defined as the process of combining geographic and demographic segmentation variables to analyse tourism consumers by where they live. This clustering technique groups UK households on the basis of information such as type of accommodation, occupation, number and age of children and ethnicity. This technique can also be used to identify the demographic characteristics of particular ‘neighbourhoods’.

Dividing the tourism market by grouping people in terms of one or more profile variables such as age and socioeconomic group can help destination marketing organisations to communicate with them more effectively, particularly when combined with additional lifestyle data where possible.

Although these profiles are relatively easy to create and apply, they are in the main still relatively poor predictors of visitors’ leisure interests and associated touristic behaviour. In recent years, however, there have been many attempts by commercial specialist companies to make geodemographic segmentation more sophisticated to provide a more refined approach to tourism marketing.

Competitive destinations and attractions are increasingly utilising the geodemographic database systems developed by commercial companies such as CACI, Experian and EuroDirect to help them to define types of neighbourhood according to a range of other customer-related characteristics.

These systems are essentially multivariable classifications of the UK population compiled on the basis of quantitative data. They provide useful insights into tourists’ behaviour, which are then used to target specific neighbourhoods or market segments in order to provide high value tourism products and services and greater levels of visitor satisfaction. The following section will review each of these in turn.

The NRS social grades are a historically widely-used demographic classification system since being developed over 50 years ago. They are principally for audience profiling and targeting by the media, publishing and advertising sectors. Often referred to as the ‘ABC1’ typology the system actually consists of six ‘social class’ grades which are derived from the occupation of the chief income earner in the respondents’ household. The grade descriptors are shown in Figure 2.

GradeSocial Status
AUpper middle class
BMiddle class
C1Lower middle class
C2Skilled working class
DWorking class
EThose at the lowest levels of subsistence

Source: National Readership Survey (2008)

Although the NRS social grades system has become established as a generic reference series for categorising and describing social class, it may be argued that it has only marginal relevance in contemporary marketing. Reference to the NRS grades is, however, still fairly common in tourism or visitor economy strategies, as the following illustrates.

  • The North Staffordshire Tourism Strategy (2004-2014) refers to ‘the increasing dominance of the ABC1 socio economic groups’
  • The West Midlands Visitor Economy Strategy published in March 2008 states that its growth markets include ‘all regional priority domestic markets – ABC1, older couples, younger couples and friends principally from the South East’.

However, it could be argued that such descriptive classifications do not define leisure and tourism markets sufficiently well to aid effective marketing planning. Blurring of the social class boundaries and the ability to predict future leisure and tourism behaviour on the basis of the occupation of the chief income earner is somewhat questionable. Also the currency and validity of this grading system is debatable since the 2001 census opted to use the revised National Statistics Socioeconomic Classification.

One of the most widely known and influential geodemographic segmentation models in the UK is the ACORN system (A Classification of Residential Neighbourhoods) which was the first such segmentation tool devised by Consolidated Analysis Centre’s Incorporated (CACI). ACORN combines geographic data with demographics and lifestyle information to group the entire UK population into five categories and seventeen groups as shown in Figure 2.

Category % PopulationGroups
Wealthy Achievers25.1

1. Wealthy Executives

2. Affluent Greys

3. Flourishing Families

Urban Prosperity10.7

4. Prosperous Professionals

5. Educated Urbanites

6. Aspiring Singles

Comfortably Off26.6

7. Starting Out

8. Secure Families

9. Settled Suburbia

10. Prudent Pensioners

Moderate Means14.5

11. Asian Communities

12. Post Industrial Families

13. Blue Collar Roots

Hard Pressed22.4

14. Struggling Families

15. Burdened Singles

16. High Rise Hardship

17. Inner City Adversity

Source: CACI (2008)

The current ACORN geodemographic model (www.caci.co.uk/acorn) has been developed over 25 years and the two-tier methodology used further divides the 17 groups shown in Figure 2 into a much more refined 56 types to produce an even more discriminating consumer classification.

By analysing key social factors and consumer behaviour together with Census and its own lifestyle survey data, over 400 demographic statistics and lifestyle variables are used to produce the ACORN classification map which is generally applicable to a range of tourism and visitor markets.

Tourism organisations seeking to understand even more about the complexity of their customers’ behaviour and lifestyles can add the ACORN ‘codes’ to their own visitor databases to produce a tailored geodemographic segmentation package to suit their specific strategic marketing requirements.

Experian’s MOSAIC is another geodemographic segmentation system that uses similar multifaceted data variables to distinguish between each of the 1.6 million unit postcodes in the country (with an average of 15 dwellings in each unit) into 11 classification groups and 61 distinct ‘lifestyle’ types which describe their socioeconomic and socio-cultural behaviour as shown in Figure 3.

Group Description % Households Type Description
Symbols of Success9.62Global Connections; Cultural Leadership; Corporate Chieftains; Golden Empty Nesters; Provincial Privilege; High Technologists; Semi-Rural Seclusion
Happy Families10.76Just Moving In; Fledgling Nurseries; Upscale New Owners; Families Making Good; Middle Rung Families; Burdened Optimists; In Military Quarters
Suburban Comfort15.10Close to Retirement; Conservative Values; Small Time Business; Sprawling Subtopia; Original Suburbs; Asian Enterprise
Ties of Community16.04Respectable Rows; Affluent Blue Collar; Industrial Grit; Coronation Street; Town Centre Refuge; South Asian Industry; Settled Minorities
Urban Intelligence7.19Counter Cultural Mix; City Adventurers; New Urban Colonists; Caring Professionals; Dinky Developments; Town Gown Transition; University Challenge
Welfare Borderline6.43Bedsit Beneficiaries; Metro Multiculture; Upper Floor Families; Tower Block Living; Dignified Dependency; Sharing a Staircase
Municipal Dependency6.71Families on benefits; Low Horizons; Ex-industrial Legacy
Blue Collar Enterprise11.01Rustbelt Resilience; Older right to Buy; White Van Culture; New Town Materialism
Twilight Subsistence3.88Old People in Flats; Low Income Elderly; Cared for Pensioners
Grey Perspectives7.88Sepia memories; Childfree Serenity; High-spending Elders; Bungalow Retirement; Small Town Seniors; Tourist Attendants
Rural Isolation5.39Summer Playgrounds; Greenbelt Guardians; Parochial Villagers; Pastoral Symphony; Upland Hill Farmers

Source: Experian (2008)

In essence the MOSAIC typology collates and statistically analyses data from sources such as the Census, Experian’s own lifestyle surveys, Market Opinion Research Institute (MORI) information, Family Expenditure Survey data and other financial research to cluster consumers into aggregated segments on the basis of social similarity rather than locational proximity (www.experian.co.uk)

EuroDirect’s CAMEO UK is another Census-based geodemographic system that has been constructed to classify over 60 million UK consumers at postcode level according to their socioeconomic status. CAMEO categorises the UK population into 10 key marketing segments as shown in Figure 4.

Group% UK Households
Affluent singles and couples in exclusive urban neighbourhoods3.46
Wealthy neighbourhoods nearing and enjoying retirement3.72
Affluent home-owning couples and families in large houses10.54
Suburban homeowners in smaller private family homes13.86
Comfortable mixed tenure neighbourhoods8.70
Less affluent family neighbourhoods14.13
Less affluent singles and students in urban areas5.90
Poorer white and blue collar workers16.93
Poorer family and single parent households10.87
Poorer council tenants including many single parents11.53

Source: EuroDirect (2008)

From these 10 groups the CAMEO model further clusters the UK market into 57 distinct neighbourhood segments which are tested to ensure there is sufficient discrimination and homogeneity in the make-up of each segment.

Whichever model is preferred, each classification is capable of helping tourism organisations to understand where their customers are, to develop more detailed profiles of those customers and how they live their lives, and to locate and target similar potential customers elsewhere in the UK.

As the demand for these commercial segmentation products has evolved, each of the companies has developed variations on their main database to suit different industries and/or geographic areas. The data is increasingly supplied in multimedia and bespoke formats to suit the clients’ specific marketing requirements.

There is evidence to suggest that these commercial segmentation packages are used in the tourism sector to select recipients for direct marketing campaigns, media selection and buying decisions to reach a particular geodemographic group. For example, Portsmouth’s Visitor Economy Strategy, July 2007 (www.portsmouth.gov.uk) states that:

'We have also drawn on TSE’s Cameo geodemographic profiling. This will help in geographic targeting and media choice…. We recommend targeting Cameo groups 3 (affluent home-owning couples and families in large houses) and 4 (suburban homeowners in smaller private family homes).'

However, whilst descriptive data of the type provided by these segmentation systems is useful to target needs-based segments they do not, on their own, equate to effective segmentation. Professor Malcolm McDonald, in particular, has been consistently outspoken in questioning the reliance on socioeconomics and geodemographics by organisations in many industrial sectors including tourism.

Whilst the models all claim to provide profiles to equip tourist destinations and attractions with actionable insights into their current and potential visitor markets, they are still relatively subjective. It should also be remembered that:

  • the nature, dynamic and make-up of individual neighbourhoods or cluster areas changes over time
  • individual tourists tastes and preferences within each of the cluster segments are likely to be very different
  • motives of individual people within the segments for undertaking tourism are likely to differ
  • individual people may move from segment to segment depending upon particular circumstances.

Put simply, even within a very narrowly defined neighbourhood there are likely to be very different types of people with, by definition, very different leisure and tourism preferences and interests living side by side.

To conclude this section it is worth noting that many destinations and tourism managers continue to use geographic, demographic and socioeconomic segmentation techniques because they are easy and an indicator of tourists’ characteristics. But remember, tourist visitors can come from different geographic, demographic or socioeconomic groups and yet still belong to the same market segment. For example, ABC1 or C2DE visitors could equally be younger couples and friends principally from the South East, which is a market segment targeted by West Midlands Tourism.

Geodemographic systems do provide considerably greater tourism segmentation benefits but, used on their own even these do not equate to an effective segmentation strategy. This is largely because they ignore key factors and determinants which influence tourist behaviour, such as personal tastes and preferences, values, previous touristic experiences, leisure time availability and propensity to travel.

Psychographic or lifestyle segmentation attempts to group people according to their lifestyle and personality characteristics. Back in 1998 Susan Horner and John Swarbrooke referred to psychographic segmentation as ‘fashionable but too difficult to implement’. This is because it involves correlating intangible personality and lifestyle variables such as the beliefs, interests, opinions, attitudes and aspirations of potential visitors or tourism consumers.

Predicting tourists’ behaviour using a psychographic approach has evolved in response to the weaknesses and limitations of the segmentation methods outlined above in helping marketing decision-makers to ‘get inside the mind’ of their tourist consumers and to understand more clearly the factors that drive their behaviour.

Whereas psychographic segmentation was considered to be ‘less scientific’ than other forms of segmentation, technological developments now mean that this ‘softer’ or more subtle segmentation approach is recognised as being more appropriate for the tourism sector. Indeed, the increased sophistication of psychographic segmentation is now providing detailed consumer insights to enable tourist destinations to take control of their visitor economy and actively design and create destination experiences to suit the needs of multiple visitor segments simultaneously. Geodemographic systems, such as CAMEO which incorporate some lifestyle variables, have been used in this capacity by destinations like Portsmouth.

The segmentation categories discussed above are specifically focused on the tourist consumer or visitor. As such they result in the production of the most usable, reliable and detailed visitor profiles as possible. However, they do not consider the visitor’s relationship with the destination or tourism product. As it’s very likely that people with similar geodemographic and/or psychographic profiles may have different interactions with the same destination or other tourism product, it is also necessary to focus on tourists’ behaviour in relation to a particular tourism or destination product.

This form of segmentation has several dimensions but, in general, it aims to group consumers in terms of their relationship with the destination product, for example, whether they are first-time or regular visitors, the purpose of their visit, loyalty and their attitudes to the destination before segmenting on the basis of behaviour or benefits sought. The commercial models considered above do not sufficiently facilitate this segmentation approach.

Having briefly considered the four classic segmentation bases it is clear that in practice, most successful destinations and tourism organisations have started to adopt a multivariable segmentation approach. This method involves defining a portfolio of relevant characteristics drawn from all four categories in line with the tourist market being considered.

Indeed, as the commercial geodemographic systems have evolved they have in effect become multivariable ‘packages’ through the incorporation of geographic, demographic and psychographic variables to divide the market into useful and actionable groups.

As with all segmentation approaches, a multivariable segmentation strategy requires that tourist consumers are clustered according to their background, needs and wants. To determine whether the visitor market has been properly segmented, the following criteria should be considered.

  • Effective and distinctive – tourist consumers in each identified segment must possess relatively homogenous needs which are also significantly different from those in other segments.
  • Measurability – identifying and understanding customers and their characteristics and behaviour patterns, and accurately quantifying the potential of each segment to ensure that it is commercially viable.
  • Accessibility – the destination or tourism organisation must be able to reach the segment with specifically formulated and cost-effective marketing programme.
  • Actionable – the destination management organisation must have the resources to exploit identified marketing opportunities that emerge from the segmentation process.

The above discussion has shown that there are a number of methods that could be used to segment the tourism market or visitor economy. However, these generic segmentation techniques based on factors such as age, social class and the family lifecycle are considered to be inappropriate for contemporary tourism marketing.

As competitive destinations and tourism organisations are looking to develop marketing strategies that target clearly specified and distinctive segments with high value tourism propositions to deliver authentic experiences and superior levels of service, it is no longer sufficient to segment solely by location, socioeconomic or geodemographic characteristics.

Destination marketing strategies traditionally defined target markets as ‘ABC1s’ or used postcode / demographic information to predict their ability and willingness to visit a destination or attraction in the UK. However, this type of segmentation is nowadays considered to be too stereotypical and simplistic. This is because it does not account for individual preferences and tastes, values and experiences or other significant influences on tourism purchasing behaviour. Moreover, behavioural and psychographic segmentation are also considered to be inappropriate for many destinations due to their inability to predict future behaviour or to account for differences in life circumstances respectively.

Arkenford (www.arkenford.co.uk), a market research and data modelling company proposed its Ark Leisure model in response to VisitBritain’s segmentation requirements. This sophisticated and highly discriminating values-based system was immediately considered to provide exactly the type of granulated and refined tourist information and in-depth understanding of different type of visitors in every part of the UK.

The Ark Leisure psychometric segmentation model consists of three main elements.

  1. Aspirations (value statements that identify segments on the basis of perceptions and judgements of quality).
  2. Life factors and choice drivers (such as income and stage in the family lifecycle).
  3. Tourism purchase scenarios (eg accommodation and attraction preferences, purpose of trip, satisfaction with choices previously made, and other purchase drivers and determinants).

By collating and analysing this information the Ark Leisure system divides the UK leisure and tourism market into eight value-based segments as shown in Figure 5 below.

(Source: Arkenford, 2008)

This model is now extensively used by regional development agencies and strategic tourism bodies such as VisitBritain, Visit Wales, Tourism South East, North West Development Agency, One North East, Marketing Manchester as well as the Yorkshire Tourist Board and attractions such as Woburn Abbey. It is also the preferred model of tourism consultancies such as Locum Consulting who have developed numerous tourism and visitor economy strategies currently being implemented throughout the UK.

One reason for its popularity is that users have been able to profile their visitors to establish the precise reasons why and how different destinations or attractions within a region appeal to different visitors. To facilitate this prior market research would need to be conducted.

For example, in 2005 Tourism South East (TSE) interviewed over 6,000 customers to gather a wealth of information on age, life stage, duration of visit or stay, travel times and the variety of activities undertaken during their visit.

When these data were then segmented firstly using the CAMEO postcode-based geodemographic model, then using the Ark Leisure motivational model, distinctive pictures of the visitors to 22 different destinations in the region were produced.

Whilst both segmentation approaches provided usable results, there was a clearly more refined and richer profiling revealed by the Ark Leisure approach. This was not surprising given its correlation with the values and behaviour of leisure and tourism consumers.

The Ark Leisure segmentation is considered to be more relevant for segmenting leisure and tourism markets because it recognises that values and beliefs shape visitors’ touristic need requirements, which subsequently influence and shape their visit and/or purchase behaviour.

The inclusion of the purchase situation dimension provides an additional segmentation benefit as it reflects the fact that people make travel and other tourism-related decisions based on whether the destination or attraction meets both their aspirations as well as practical and personal requirements. An overview of the eight Ark Leisure segments and their associated descriptors is shown in Figure 6.

Cosmopolitans
  • Strong, active, confident
  • Style and brand important, but as an expression of their self-made identity
  • High spenders especially on innovation and technology
  • Looking for new challenges, new experiences
  • Globetrotters
Discoverers
  • Independent in mind and action
  • Little influenced by style or brand but interested in new options
  • Buy on function and value to them
  • Looking for new and educational experiences
Traditionals
  • Self-reliant, internally referenced
  • Slow to adopt new options
  • Strong orientation towards traditional values
  • Value individual attention and service
Functionals
  • Self-reliant
  • Price-driven
  • Value function over style
  • Traditional values, but interested in new experiences, not risk averse
Habituals
  • Largely inactive, low spending group
  • Very traditional, strongly resistant to change
  • Risk averse
  • Value relaxation, peace and quiet
Followers
  • Strongly influenced by what others will think
  • Don’t want to be seen as old fashioned
  • Less active
  • Slow to adopt
  • Avoid risk
High Street
  • Mainstream early adopters
  • Followers of high street fashion
  • Care what others think
  • Happy to buy packaged options
Style Hounds
  • ‘Young Free Single’, impulsive
  • Fashion counts
  • Brand counts
  • Looking for fun with friends
  • Most not seriously sporty

Source: Arkenford (2008)

Evidence suggests that those destinations that have segmented using the Ark Leisure system have all gained considerable more insights into, and better understanding of their existing and potential visitors’ needs, motivations, holiday-taking or visit behaviour. For example, TSE established that the ‘high street’ group were ‘moderately interested in intellectual pursuits, arts and culture’ – important product development and destination marketing research.

In addition, it revealed interesting information on attitudes, awareness and responsiveness to their destination brands and product portfolios, such as TSE’s core visitor market for all of its heritage destinations came from the ‘traditional’ and ‘functional’ groups. Furthermore, the model revealed how visitors’ priorities and product choices might change under different purchasing scenarios.

Using the model in conjunction with destination or attraction-specific market research information is still, however, only one aspect of the market selection process. The targeting decision – deciding which of the eight segments to focus on with an effectively co-ordinated marketing programme is a crucial marketing management decision.

For example, TSE followed up the segmentation work by deciding to focus on three specific ‘markets’ because of the synergies between them with a series of targeted marketing campaigns. Having decided that visitors in the Cosmopolitans/Discoverers, Functionals/Traditionals and High Street/Followers segments should be targeted, a tailored promotional campaign was designed around a desirable visitor package or ‘bundle’ of destinations, accommodation and activities likely to stimulate their interest.

More recently, Arkenford have updated and refined their leisure model to propose an innovative ArkZone geographically-oriented segmentation system to provide further insights into visitors for application from a direct marketing perspective. The eight Ark leisure groups are sub-divided into 43 ArkZone types based loosely around postcodes. This development is considered to extend visitor behaviour and lifestyle knowledge to enable more accurate and effective marketing strategies to be developed, and also to identify new potential visitors.

Finally, TSE are looking to build upon this segmentation work by emulating the innovative marketing activity of Amazon, the online retailer. Using identified visitor preferences, TSE can now provide complementary tailored purchase suggestions to promote leisure and tourism activities and experiences as chosen ‘by people like you’.

Without appropriate and effective segmentation, all other marketing activities are likely to be mediocre at best. Whilst the tourism sector has traditionally lagged behind other industries in utilising the concept of segmentation in marketing decision making, there is evidence to suggest that increasingly better market selection is now the basis on which resource allocations decisions at a strategic level are made.

There are still far too many destinations, attractions and tourism organisations, however, using the classic, but outdated and unsophisticated segmentation bases to define their markets. Encouragingly, in their search for visitor segmentation variations derived from geodemographics, some destinations have turned to commercial segmentation systems.

Whilst these are clearly an improvement on the traditional, simplistic segmentation bases and can provide more refined visitor profiles, the fact these were initially designed for non-service industries, means that they do not always yield the multi-dimensional benefits of the Ark Leisure values-based model. Ultimately, decisions on how to segment the visitor market and the criteria to employ will be dependent upon the scope of the destination’s market planning needs, resources and expertise. It must be remembered that an enhanced understanding of the distinct and homogenous needs of different visitor types based on their motivations and attitudes will allow the destination or attraction to finely tune the multifaceted visitor offer.

It appears that the most successful tourist destinations have undertaken a detailed segmentation analysis without being drawn down the easier route of over-simplified classifications. They have then targeted those segments that closely matched their strengths before designing a value-added composite visitor experience whereby all aspects of the extended marketing mix are integrated in line with the needs of the selected target segments.

  1. Levitt, Theodore, The Marketing Imagination(1983), The Free Pres (New York)
  2. McDonald, Malcolm, "How Marketing Fell to Pieces", The Marketer, (2005), Issue 12, April, pp14-17
  3. Horner, Susan and Swarbrooke, John, "Key Issues in Market Segmentation in Tourism Today", Insights, A7-A18 (1998), English Tourist Board

Paul Williams is a Programme Area Manager at Staffordshire University where he manages and leads the development of undergraduate, postgraduate and professional courses in business, management, tourism and events within the Business School. He is the current Senior Examiner for the Chartered Institute of Marketing’s tourism marketing diploma and a member of the Tourism Management Institute’s CPD group.

As well as advising Edexcel, QCA and City & Guilds on aspects of curriculum development, he is also an active member of the Higher Education Academy’s internationalisation group. Paul also has done extensive external examining work in the UK and overseas. His research interests include sustainable tourism, place marketing and destination branding, tourism-led regeneration, and special interest tourism.