The current tourism sector is marked by heterogeneity and because of this, it is important for hotels to define the segment they would like to target in order for the needs of the customers to be more fully met. Segmentation is a profitable differentiation strategy that allows companies to compete in a way that includes more than just price competition.

The current tourism sector is characterized by marked heterogeneity, which implies the existence of a wide variety of needs, desires and expectations. Besides being heterogeneous, the demand is also becoming more demanding. We are traveling more and increasing our knowledge and therefore also increasing our demands in looking for a product suited to our specific needs. Paulo Coelho excellently defined it when he said that “The best university is travel.”

Customers demand experiences that awaken their emotions. It is important to define which segment(s) we want to manage and to know the tastes and needs of that segment with the objective of satisfying with a product adapted to it and obtaining loyalty this way. Alex Zozaya, CEO of AMResorts, notes the importance of selecting your market “There always needs to be clarity in this: you cannot be everything to everyone. It has to be the best and the leader for some”.

Segmentation is a reality that is part of the strategy of large hotel companies and tour operators. It represents an opportunity for small and medium-sized hotel companies to compete with the larger ones by creating customer value, providing a differentiated experience, and focusing on the needs of the customer. By doing this, they avoid just competing by price.

Today, thanks to the instruments available, we can know our target segment and identify the attributes of the product that has useful value when facing renovation projects because it allows us to efficiently allocate economic resources at our disposal between those investments that really add value for the customer or that differentiates the product from competitors, thereby reaching an escape from the red ocean.

If the expectations of a customer are met satisfactorily it will be reflected in the satisfaction evaluation and in the online reputation of the hotel. That, along with  rebranding, will move a hotel into his own blue ocean, allowing the increase of rates and the profitability of the hotel.

Following the methodology mentioned, The Hotel Factory, through recent segmentation and rebranding projects, has generated measurable results for its customers by adjusting the investment, focusing on the attributes most valued by the customers, introducing differentials and also getting substantially improved customer satisfaction and a better average rating.