You are on page 1of 14


Chapter Contents

Segmentation: By definition
Segmentation by purpose Psychographic (cognitive-normative) Interactional

II. Segmentation Methods

a) b) c)

III. The Needs and Impacts of Different Types of Tourists IV. Types of Tourists and Economic Policy of Destinations

I. Segmentation
* Segmentation: to classify customers into several groups or categories in terms of their common preferences and needs * Two main reasons for segmentation:
1. To rationalize marketing efforts of suppliers 2. To examine various economic limitations and contribution, thus formulate policy based on behavioral or psychological economics

TOURIST TYPES II. Segmentation Methods

I. Segmentation by Purpose:

(a) Recreational purposes (leisure)

(i) Holiday (ii) Health and Sports (iii) Religion VFR, Study

Holiday purposes include sunlust and wanderlust

(b) Business purposes

(i) Company Business (ii) Convention (iii) Sales trips (iv) Incentive trips

TOURIST TYPES II. Segmentation Methods

1. Segmentation by Purpose (cont.) Recreational or Leisure travels and VFR can be seen as final demand while business travel is mostly a derived demand or secondary demand.
Recreational Travelers are subject to personal economic constraints but Business Travelers are largely institutionalized and limited by corporate economics.

Leisure travel demand is more income and price elastic than business travelers.
Incentive travel is specific and both Business and Leisure Travels

TOURIST TYPES II. Segmentation Methods Types of Tourists by Purposes of Travel

Tourists and excursionists

Recreational Purposes Business Purposes


Health& Sport

Religion VFR & study Conventions

Company B Sales trips

Sunlust Wanderlust Incentive trips

TOURIST TYPES II. Segmentation Methods

2. Psychographic Segmentation: uses psychological variables.

A limited number of traits which are important for tourists: venturesomeness, hedonism, dogmatism,

These traits influence tourist activity or the purchasing characteristics of tourists.

Stanley Plog developed a model to divide tourism

markets based on their venturesomeness:


II. Segmentation Methods

2. Psychographic Segmentation (cont.) * (a) Allocentric: highly venturesome; make own travel arrangements, visit remote and unfamiliar destinations, learn local culture, and rarely repeat visit to the same place.

(b) Mid-centric: liking to explore but with comfort; uses travel distributors, but make own package, travel reasonably far but to known destinations, balance novelty with home comforts.
(c) Psychocentric: disliking unfamiliarity and risks; use organized inclusive tours (package tours), travel often to familiar destinations culturally similar to home, board in mass accommodation or, often 7 repeat visit.

TOURIST TYPES II. Segmentation Methods

3. Interactional Segmentation: to segment tourists with respect to the effect on the tourism destination. (a) Explorer: small in numbers, virtually no consumption of tourism products, negligible economic impact (b) Elite: relatively small number, price-inelastic demand for very high quality products, may cause investment to follow into destinations.

TOURIST TYPES II. Segmentation Methods

3. Interactional segmentation (contd.) (c) Hosted or second homers: constant travel demand, but boarded by hosts or in own accommodation, hence low consumption product, but cause increase in general local expenditure (d) Individual: numerous, wide ranging travel, demand maybe price-elastic, significant demand for domestic tourism products (e) Mass-or charter: very numerous, sectors of the travel industry wholly dependent on them, major impact and costs at destination, may cause significant investment in destination by generator owned business.

Figure: Eric Cohens classication of tourist typologies

III. The Needs and Impacts of Different Types of Tourists

Variations between types of tourists: 1. Length of stay: from a week to 30 days 2. Overall & seasonal demand stability:
(a) VFR and luxury recreational tourism is the least sensitive to demand variation (b) Leisure Travel is constrained by school vacations, work entitlements, climatic conditions (c) Business Travel is influenced by the long term stability of demand affected by economic cycle in Tourist Generating Regions.

TOURIST TYPES III. The Needs and Impacts of Different Types of Tourists

3. Repeat visiting & Marketing Costs:

(a) The psycho-centric tourists and second home owners are most likely to repeat a visit to a destination. Because they are willing to visit familiar destinations

(b) Cruise passengers exhibit high repeat purchasing (because of strong brand loyalty)
(c) Repeat visiting decreases tourism marketing costs.

TOURIST TYPES IV. The Type of Tourists and Economic Policy of Destinations

To maximize economic profits we need to: 1. to identify discrete tourist market segments 2. to assess the stability and demand patterns of each segment

3. to evaluate the returns or profit contributions realized from each segment

4. to allocate resources to attracting each segment, in other words, making cost-benefit analysis in the tourism sector

End of Slides