06 Nov Hotel guest segmentation strategies: boost sales for specific types of hotel guests
In my previous article about guest types, I managed why it is important to know your focus market. In this article, I would like to run through the hotel guest segmentation strategies, that can help you to find the best way to identify your target market.
How does the guest segmentation work in the hospitality business?
First of all, we should define what is the segmentation. It is “the process of defining and subdividing a large homogenous market into clearly identifiable segments having similar needs, wants or demand characteristics” (Helena Rove in Book Direct). Most common segmentation in the business of hospitality is based on guest (travelers) types. They define clear and unambiguous segments to which you can focus and find your main one.
How to start the segmentation?
- First of all, you will need to identify WHY your place is being chosen among competitors. What is the factor that attracts people to your place? Also, it is very important to find out, WHERE your bookings are coming from? Is there any particular channel that brings your guests.
- Secondly, you need to find out HOW MUCH money particular guests are spending. Do they just make a reservation or they also spend money after the arrival (e.g. extra services, activities an etc)?
- Times and people needs are changing. Meaning that guests’ behaviors are changing as well. You should keep up with the changes in the hospitality industry and review it once a year. Maybe you will realize that you need to re-shape your business to absolutely new guest segment or maybe you need to adjust a little bit in order to fit needs of your current market.
Boost sales for specific guest groups
Tourists. This group is visiting country or city for sightseeing or recreational purposes. Meaning, that most of the times, they will sty more than 1 night at the same place. It’s smart to have other points of sales, such as breakfast option, bike rental, organized tours and etc. Hotels quite often have arrangements with local tour guiding companies and therefore it is very convenient for the guest to book a tour right at the hotel. You can prepare more different pricing options so different length of stay would guarantee better pricing.
Backpackers. This group of travelers is the most price sensitive. Meaning, that they do not expect luxury service. Rather they just need a bed to sleep. If you are focusing on backpackers, most probably you are running a hostel. In order to attract more guests, you should focus on becoming a very unique hostel in the area. People who are staying in hostels are usually young travelers who are seeking experiences. They need uniqueness and impression. Sales for such guests can be boosted by signing contracts with travel agencies, specializing in backpackers. Another good idea is to partner up with schools, universities, NGOs and various youth organizations.
Business travelers. For this segment the most important factor is convenience. They are willing to stay next to transportation hubs or around office buildings. Most of the times they will stay at the hotel for 1 or 2 nights. There must be a given opportunity for these guests to work from their hotel room. This can be one of your main sales points. Create an advertise your hotel as a perfect home office environment. You should focus on the room sound isolation so those, who come to the room just for a sleepover, can get the rest. Those, who stay in the hotel room and work, should have all the necessary equipment. Get a comfortable desk and chair (!), pay special attention to the lighting of the room and make sure that your wi-fi is immaculate. Advertise all these facts to various big companies or event organizing vendors. They can become your best sales channel and fill your hotel with business travelers.
Families. If your main guest target group is families – make sure that there are enough activities for all family members. Especially focus on children and what activities they can do while staying at your place. You can offer children day-care services, various animations and recommend tours, where the whole family can attend. Make sure to have a good room sound isolation. This will ensure that family piece is not being disturbed and also others will not hear crying babies or running toddlers.
Elders. If your main target group is elderly travelers, you should focus on the comfort and relaxation of the guest. Hotels are usually located in the resort areas, around thermal lakes/baths and other health-related structures. Elderly guests are also more likely to choose your place if there is a wellness place or at least a sauna and a pool. The hotel should have contracts with local travel agencies arranging short excursions or gastronomy tours in the city. Make sure to have a daily pass to the nearest SPA or thermal bath!
Doesn’t matter which is your main guest target, you have to know it and you have to make your business according to the needs of that group. Hence it is very important not to get comfortable and be aware of the market changes. Talk to your guests, leave hotel guest questionnaire, ask for reviews, analyze reports and get to know your guests. Revise your knowledge every year and make sure that you are still meeting the needs of your main guest group.