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An Approach to Market Segmentation h III Transient Guest --_` • Independent Traveler Group j •I Pleasure i • i / \ Status- I Prestige Educational- Medical- Cultural Recreational- • Therapeutic Break in Routine Business • j Interpersonal • - j Visit Friends & Relatives Pleasure Meetings Sales •• • Educational- \ Technical Business Status- \ Prestige Educational- Medical- Cultural Meetings Sales Recreational- ; Therapeutic •• Educational- Break in Routine Technical Interpersonal- Visit Friends & Relatives • The Site and Evaluation portion of and accurate. information sources must SEGMENTATION • I he report is concerned with the relation- he clearly identified so that statistics can • iiheship of the site to the area's business gen- verified. The Demand Analysis, how- The Market Overview must examine r rators and the transportation network. ever, must provide you with more than data and information sources: it segments as well as the aggregate mar (See above: site and area evaluation, ac- mustket. Otherwise. the aggregate could he eSsibility. visibility and adaptability.) draw conclusions. grossly overestimated. Different seg- The Supply and Demand Analysis Conclusions never spring wholly and merits may have very dissimilar needs encompasses the competitive situation directly out of data. Between the data and for hotel facilities and services. (above), both direct and potential, and the report's conclusions lies a set of as- One approach to market segmentation existing and future demands. The De- sumptions. These assumptions permit is diagrammed in the exhibit shown here. mand Analysis is the pivotal section of the the consultant to move from demand sta- it suggests that the transient guest can report. Summary discussions below tistics to room rates and occupancy levels he divided first into segments made up rover: and ultimately to estimates of operating of independent travelers or organized 1. Conclusions presented in the de- expenses. groups of individuals. Those segments mand analysis section. The Demand Analysis Section should can then he divided into subsegments 2. Sources of information in establish- allow the reader to move step by step based on the primary purpose of travel: ing demand. from the data through the consultant's as- pleasure or business. These subset:;- 3. Market Segmentation. sumptions to the conclusions presented ments could further be divided into spe- 4. Room night demand, and in the report. cific types of activities and motivations for ' 5. Demand for facilities and services travel. other than rooms. INFORMATION SOURCES A similar model may ),pride the consul- ' rant and help you understand, more inti CONCLUSIONSCommon sources of information used mately, the market study area. An analy- hv consultants to establish demand are sis as detailed as this model suggests re- Conclusions presented in the demand lister) in an accompanying box insert on quires much time and is expensive. Such : analysis have two purposes, to: (1)guide sources of information. an approach, however. may give you a the consultant in making recommenda- The availability of demand information thorough understanding of relevant mar- • tions on facilities and services• and (2) varies by location. Cities and centers of kets and provide a more solid base (or I form the basis for the report's estimates government, trade or tourist activity pro- marketing and financial decisions. of operating results. vide the most comprehensive sources. The ability to borrow both equity and Smaller communities, however-, may ROOM NIGHT DEMAND borrowed capital depends on the hotel's0 represent a small and well-defined market profit potential, which requires a minimal that facilitates primary research. h. Methods aren't complicated for rcri level of demonstrated demand. in either case, a feasibility report mating room night demand. Considerable The two aspects of the Demand Analy- should consolidate information sources research is required. in a small market • • <ic that you. as user of a feasibility report, and organize the consultant's own re- area, the estimate can he made 1w inter- - n>>rst carefully evaluate are: the data.and search in such a way as to present a co- viewing persons at demand generator, • the consultant's assumptions. hermit picture of existing and future de- (primarily commercial and indncrrwl j • Data must ho timely. comprehensive mand. firms) with the greatest knowledge of-G• 1 rlrx:r\r:.'�Vrrlv\r tnFR 1e)gr7 til