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Industry Segments

The .travel TLD is intended to serve the global travel community. .travel is restricted to people, organizations, associations, and private, governmental and non-governmental agencies in the travel and tourism industry. The registrants are not limited to, but may fall within, the industry types set out in the table below, which is provided only as a list of illustrative categories and types, and not as a restriction of the general eligibility requirement. The Registry may establish stricter requirements for registrants by published policy statement. The Registry may extend the list of industry types from time to time by published policy statement, provided that any such extension is consistent with the travel communitys perceptions about the prevailing scope of the community as evidenced by the support of such extension by the travel industry as communicated to TTPC and the Registry through its policy outreach procedures. 1. Airlines 2. Attractions/Theme Parks 3. Bed & Breakfast Houses 4. Bus/Taxi/Limousine Operators 5. Camp Facility Operators 6. Vehicle Rental Companies/Airport Specialty Car Park Companies 7. Computer Reservation/Travel Technology Provider 8. Convention & Visitors Bureaus 9. Cruise Lines 10. Ferries 11. Hotels/Resorts/Casinos 12. National Tourism Offices 13. Passenger Rail Lines 14. Restaurants 15. Tour Operators 16. Travel Agents 17. Travel Media 18. Travel Consumer and Market Research Organizations 19. Travel Insurance 20. Travel Training Institutes 21. Suppliers of goods or services to the eligible industry participants set out in these defined sectors

Introduction The UK leisure travel industry is a large, highly fragmented and competitive market. In total, UK consumers take almost 110 million holiday trips each year. Of these, some 36 million trips are overseas (Overseas Holidays) a market worth 16 billion. Segmenting the market The Overseas Holiday market can be segmented in several ways: Transportation The key distinction being between holidays involving an element of air travel (Air-inclusive Tours or AIT) and holidays involving other means of transport (Non-AIT). The most significant type of Non-AIT transportation is Self-Drive, particularly to France, Italy and Ireland. Destination The most popular overseas destinations for UK holiday makers are Spain, France, North America, and Greece. By definition, many of these destinations require air travel as part of the holiday experience, with self-drive only being a practical option for certain Western and Northern European destinations. However, a wide range of holiday experience is possible in any of the above countries. Accommodation Holiday accommodation varies enormously. It can be hotel-based (with a range of catering options), in apartments, villas, holiday home properties, mobile homes, tents, boats and other categories. Flexibility and Customer Management Customers may prefer holidays with a high degree of independence and flexibility, with little if any involvement during the holiday from the tour operator. At the other end of the spectrum, many holidays are based around an escorted, fixed itinerary where the tour operator controls and manages most of the holiday experience. Activity A number of holidays are designed around offering a particular type of activity such as scuba diving, walking or skiing. Such holidays can also offer expert tuition as part of the package or alternatively be designed for well-experienced participants.

Duration Most holidays tend to be taken for either 7 or 14 nights. However, according to the International Passenger Survey , the fastest growing segment by holiday duration is for holidays taken for between one and three nights i.e. weekend and short break holidays. Price and Quality As in any consumer market, operators position holiday products in a range of prices from unbranded, discounted holidays priced at less than 99 to luxury, all-inclusive and highly bespoke itinerary holidays in excess of 10,000 per passenger. The majority of Overseas Holidays taken by UK consumers involves taking either a scheduled or charter flight to their chosen destination and so fall into the AIT category. Within the broad AIT classification, there will be a plethora of different destinations, accommodation types as well as varying degrees of customer management. All of this translates into a continuum of holidays covering a broad range of price points.

market segmentation - introduction

Markets consist of customers with similar needs. For example, consider the wide variety of markets that exist to meet the following needs Eat Drink Exercise Travel Socialize Educate As you can imagine, such markets (if they were not further divided) would be very broad. Customers in a market are not the same. For example, within the market to provide meals, customers differ in the: Benefits Amount they are Media (e.g. television, Quantities Time and place that they buy they or radio they want pay see buy

able to newspapers,

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to they

It therefore makes sense for businesses to segment the overall market and to target specific segments of a market so that they can design and deliver more relevant products and services A market segment can be defined as follows: A customer group within the market that has special characteristics which are significant to marketing strategy Segmentation is most often applied to markets, but it is equally relevant to distribution channels and customers. However, similar principles of how to segment apply to all three.

Overall definition of segmentation Segmentation involves subdividing markets, channels or customers into groups with different needs, to deliver tailored propositions which meet these needs as precisely as possible.

market segmentation - behavioural segmentation

Behavioural segmentation divides customers into groups based on the way they respond to, use or know of a product. Behavioural segments can group consumers in terms of: Occasions When a product is consumed or purchased. For example, cereals have traditionally been marketed as a breakfast-related product. Kelloggs have always encouraged consumers to eat breakfast cereals on the "occasion" of getting up. More recently, they have tried to extend the consumption of cereals by promoting the product as an ideal, anytime snack food. Usage Some markets can be segmented into light, medium and heavy user groups Loyalty Loyal consumers - those who buy one brand all or most of the time - are valuable customers. Many companies try to segment their markets into those where loyal customers can be found and retained compared with segments where customers rarely display any product loyalty. The holiday market is an excellent example of this. The "mass-market" overseas tour operators such as Thomson, Airtours, JMC and First Choice have very low levels of customer loyalty - which means that customers need to be recruited again every year. Compare this with specialist, niche operators such as Laskarina which has customers who have traveled with the brand in each of the last 15-20 years. Benefits Sought An important form of behavioural segmentation. Benefit segmentation requires Marketers to understand and find the main benefits customers look for in a product. An excellent example is the toothpaste market where research has found four main "benefit segments" - economic; medicinal, cosmetic and taste.

market segmentation - demographic segmentation

Demographic segmentation consists of dividing the market into groups based on variables such as age, gender family size, income, occupation, education, religion, race and nationality. As you might expect, demographic segmentation variables are amongst the most popular bases for segmenting customer groups. This is partly because customer wants are closely linked to variables such as income and age. Also, for practical reasons, there is often much more data available to help with the demographic segmentation process. The main demographic segmentation variables are summarized below:

Age Consumer needs and wants change with age although they may still wish to consumer the same types of product. So Marketers design, package and promote products differently to meet the wants of different age groups. Good examples include the marketing of toothpaste (contrast the branding of toothpaste for children and adults) and toys (with many age-based segments). Life-cycle stage A consumer stage in the life-cycle is an important variable - particularly in markets such as leisure and tourism. For example, contrast the product and promotional approach of Club 18-30 holidays with the slightly more refined and sedate approach adopted by Saga Holidays. Gender Gender segmentation is widely used in consumer marketing. The best examples include clothing, hairdressing, magazines and toiletries and cosmetics. Income Another popular basis for segmentation. Many companies target affluent consumers with luxury goods and convenience services. Good examples include Coutts bank; Moet & Chandon champagne and Elegant Resorts - an up-market travel company. By contrast, many companies focus on marketing products that appeal directly to consumers with relatively low incomes. Examples include Aldi (a discount food retailer), Airtours holidays, and discount clothing retailers such as TK Maxx. Social class Many Marketers believe that a consumers "perceived" social class influences their preferences for cars, clothes, home furnishings, leisure activities and other products & services. There is a clear link here with income-based segmentation. Lifestyle Marketers are increasingly interested in the effect of consumer "lifestyles" on demand. Unfortunately, there are many different lifestyle categorisation systems, many of them designed by advertising and marketing agencies as a way of winning new marketing clients and campaigns!

market segmentation - geographic segmentation

Geographic segmentation tries to divide markets into different geographical units: these units include: Regions: e.g. in the UK these might be England, Scotland, Wales Northern Ireland or (at a more detailed level) counties or major metropolitan areas Countries: perhaps categorised by size, development or membership of geographic region City / Town size: e.g. population within ranges or above a certain level Population density: e.g. urban, suburban, rural, semi-rural

Climate: e.g. Northern, Southern Geographic segmentation is an important process - particularly for multi-national and global businesses and brands. Many such companies have regional and national marketing programmes which alter their products, advertising and promotion to meet the individual needs of geographic units.

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