8-) Segmenting and Targeting Markets

        Segmentation is all about breaking up the market so that the business can focus on a particular segment. This helps the business to understand the needs of the customers better, identify opportunities, develop better marketing strategies and assess the company strengths and weaknesses. The market can be segmented into five different groups. They are demographic, geographic, psychographic, geodemographic and behavioral. Selecting one or more these market segments to develop better products/services which aim specifically at these segments is called targeting. Thus, targeting allow Hilton to focus the effort to satisfy the needs of the customers.

       For Hilton Hotels’ demographic segment, they look mainly at income/occupation/socio-economic group and family life cycle. The rest characteristics such as age, gender, religion, race, etc. are not really taken into consideration. This is because as Hilton Hotels provide premium pricing products and services, focusing on these groups and satisfy their needs can bring more profit to the business. In another segment, geographic, it will be difficult for Hilton to divide the market in smaller segments as Hilton is a global brand which hotels are located in almost every country around the globe. Thus, they will need to segment the market into countries as their customers will be from any country in the world. For psychographic segment, Hilton will need to segment the market based on lifestyles, values and personalities of its customers. According to the nature of the business, Hilton Hotels will need to focus on business people and high disposable income people as the products services from Hilton Hotels match perfectly with the lifestyles, values and personalities of these people.

     As for the geodemographic segment, Hilton Hotels need to consider the geographic of their hotels, such as location, by looking at the demographic characteristics of the hotels. Because of the fact that Hilton Hotels’ demographic segment includes business people, high income leisure travelers and families, the location that Hilton Hotels need to choose will mainly have to be the central place of a city or a country where it is accessible from everywhere as well as the popular places which have high tourist attractions. In the final segment, behavioral, Hilton Hotels need to divide the market depending on customers loyalty, the user status, purchase occasion, etc and facilitate them with different kinds of services and goods. For this, Hilton Hotels need to keep in touch with the activities of its customers and their feedback on their experiences in the hotels. For example, if the business wants to focus on purchase occasion, they should do some form of promotion to increase the purchase occasion.
      Finally, Hilton Hotels need to target one or more of the segments to focus. As for Hilton Hotels, it targets primarily at geographic segments and psychographic segments. The prices of all the hotel’s services and products are very high which shows that Hilton Hotels is focusing on geographic segments and these kind of expensive high quality services and products are aimed at satisfying the needs of the psychographic groups that the hotels aims at. Therefore, when selecting target marketing strategy, Hilton Hotels need to choose differentiated marketing strategy where a number of marketing mixes aims at one or more segments.