The tourism industry provides a good example of the difference between market segmentation and a target market. To enable marketers to develop an effective marketing strategy, it is essential to know who the customers are and what want they want as well as understanding their buying behaviour. Initially a market is segmented into various groups of customers with similar attributes, and then from this information a specific segment is selected as the primary target market.
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A market can be segmented into groups by using demographics such as age and gender, psychographically considering customer attitudes and tastes, or geographically. To find out how travellers think and feel about travel, psychographic research could be carried out. Williams suggests that this "softer or more subtle approach is recognised as being more appropriate for the tourism sector." Travellers will be seeking different experiences and marketing materials must be relevant to their personal tastes.
A target market can be decided after extensive market research which will include market segmentation analysis. Brighton and Hove Council have reported that "the majority of city break takers to the city are couples. The age group 25 to 34 years is the main target group for the city of Brighton." Marketers need to understand what requirements this segment of the market have so that they can appeal to them and gain their interest.
The marketing strategy
The Chartered Institute of Marketing defines segmentation as "splitting a market into sub groups of people or organisations with common needs or preferences who are likely to react or purchase in the same way." Different segments will require different marketing strategies to maximise interest and curiosity. This will affect the locations and the activities that will be offered, how it will be advertised, the prices and promotions. The strategy is often known as the "marketing mix."
McDonald and Dunbar suggest that segmentation is the "bedrock of successful marketing." Without it, identifying the target market is difficult. Understanding the difference between segmentation and a target market is fundamental. Although they are interrelated, they are different aspects of market research. Both aspects are necessary to enable the marketer to get the "right product or service in the right quantity, to the right place, at the right time and make a profit in the process."
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