holiday market segmentation

Question 1

4 ways to segment (that I’m using)

Answer 1

life stage, lifestyle, behavioural/time

Question 2

Arc leisure model

Answer 2

good example of advanced multivariate market segmentation, created by a research group

Question 3

arc leisure model provides

Answer 3

a solution with 8 market segments, from mathematically analysing the geographic, psychographic and demographic data etc.

Question 4

arc leisure model segments

Answer 4

cosmopolitans, discoverers, traditional, followers, habituals, high street, style hounds

Question 5

life stage groups

Answer 5

young people, families, elderly

Question 6

young people (life stage)

Answer 6

girls or lads holidays (party); e.g. Party hard Travel and Club 18-30/club extra (Thomas Cook)

Question 7

families (life stage)

Answer 7

activity holidays; e.g. Centre Parks (short breaks in forest with first class facilities and accommodation; e.g. Butlins (short breaks at UK holiday parks); e.g. Kempervermen in Netherlands (€382 per night)

Question 8

mature/elderly (life stage)

Answer 8

generally retired people; SAGA holidays: hotels, escorted tours, river cruises, ocean cruises, group holidays and long stay holidays e.g. Amsterdam escape 4 nights £499

Question 9

Life style groups

Answer 9

active, cultural, leisure

Question 10

active (life style)

Answer 10

• e..g waterspouts, skiing, hiking
• Crystal Ski holidays
• National geographic expeditions to Iceland, Peru etc.

Question 11

cultural (life style)

Answer 11

• city breaks: last minute.com, easyJet, Hilton Explore
• school trips: NST: focus on low costa and safety
• Travelling/Gap Year: STA travel

Question 12

leisure (life style)

Answer 12

• cheap: On the Beach.com
• expensive/luxury: Thomas Cook (Long haul flights, adults only)
• All inclusive: OntheBeach.com and Virgin
• weekend breaks: secret escapes

Question 13

TIME

Answer 13

Statistics from RJM Metrict.

Based on Behavioral Segmentation- when and why customers book their holiday.

Linked with user status, loyalty and usage rate.

Question 14

WHY IS BEHAVIOURAL SEGMENTATION IMPORTANT?

Answer 14

• Helps to maintain customer loyalty
• Know when to target lapsed users
• By understanding how and why they have chosen this time it means the marketing can be tailored to them.
• Understand how to maintain or create a relationship with this target segment

Question 15

HOLIDAY SENSITIVE vs. HOLIDAY INSENSITIVE

Answer 15

Holiday sensitive industries experience significant uptake during the holiday season.

Experience a slump in the off seasons

Newly acquired customers are worth less as it would be expected for them to book with discounts.

Paired with less loyalty, looking at consumer base with lower lifetime value.

Question 16

No. of ORDERS: HOLIDAY vs. NON-HOLIDAY CUSTOMERS

Answer 16

-Non-Holiday customer do very slightly better than holiday customers.
Shows that there is a segment that could be tapped.

It’s interesting to note that Holiday Shoppers are different from the Non-Holiday Shoppers in the following ways:
They are typically NOT shopping for themselves but for someone who belongs to a different demography;
They are cost-conscious;

Question 17

WHEN DO THEY PURCHASE?

Answer 17

39% Buy a holiday on the same season, usually within the first 2 months back,

42% will make another purchase within the following 10 months.

Only 6% will wait until the next holiday season to make a second purchase

This behavior closely mirrors the purchasing patterns of non-holiday customers.

Question 18

HOW DO THEY PURCHASE THEIR HOLIDAYS?

Answer 18

No point sending a text with a deal to someone in the 55-64 age group as it will have no impact.
Another way to segment it within time.
Need to consider not only when, but how they purchase the product.

e.g.
People in Yorkshire, Wales and the West Midlands are more likely than average to book a holiday abroad via a travel company or agent, along with young families (with children under 5), 18-24 year olds, 25-34 year olds and those aged over 55.

Those in Northern Ireland, the East and the South East are more likely than average to book at least one holiday directly with the service providers, and the older people get, the more likely they are to do so.

Question 19

BEHAVIOURAL SEGMENTATIONS - TUI

Answer 19

Linking this with TUI- How is Behavioural Segmentation useful?
Type of Holiday or Package they might want
When and how they are willing to buy it
Could even influence where they holiday next.