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The Travel Market consists of three main segments: Luxury travellers, Adventurers, and Budget travellers. These segments are defined by demographics such as age and income, psychological factors like personality traits, and desired benefits such as specific needs and product features. Luxury travellers, often older or middle-aged individuals who are financially well-off, seek relaxation and rejuvenation from their high-stress lifestyles. This group may also include retirees. Luxury travellers are willing to pay more for superior value, quality, and service, prioritizing high-quality accommodations and experiences during their travels.
Banyan Holding's Banyan and Laguna resorts and hotel line are likely to appeal to this segment of travellers.
Banyan Tree hotels and resorts aim to provide a warm and friendly retreat experience for guests who appreciate exclusive and unique locations, indulgent luxury, and exotic experiences. These discerning customers value personalized service, ambiance, design, and self-contained private retreats with tasteful amenities. Luxury travelers who travel with their families may prefer Laguna resorts and hotels due to the wide range of amenities available for guests of all ages such as the children's suite, Laguna shopping center, and Angsana Spas.
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Laguna hotels offer various services appealing to a broader audience, making them attractive to luxury travelers vacationing with their families. Adventurers are typically financially independent younger working adults in their twenties to late thirties willing to spend on unique experiences.
Adventure travelers are drawn to exotic destinations that emphasize outdoor activities and authenticity, preferring culturally rich, less urbanized areas for an authentic and exciting experience. Angsana Hotels and resorts by Banyan Tree cater to those seeking adventure with contemporary design and thrilling activities such as bungee jumping, white-water rafting, and trekking.
Angsana hotels are known for their distinct locations in world heritage sites, providing a mix of rustic charm and luxury for adventurous travelers.
Budget travelers, usually from the lower to middle income bracket, value financial independence and are careful with their leisure expenses. These individuals, often young parents saving for their children's education and supporting their parents, prioritize deals and promotions over top-notch quality and service. Therefore, they are unlikely to be attracted to the upscale and expensive offerings from Banyan Tree Holdings.
These consumers are likely to be too busy providing for their families to have time for Angsana or Banyan spa treatments. When they travel, they opt for more affordable hotels because they prioritize price over luxurious amenities or high-quality services.
Factors such as market size, growth potential, competition position, cost to reach the segment, and alignment with Banyan Tree's goals and resources are used to assess market segment attractiveness. Budget travellers make up the largest group among leisure travellers while adventurers are the smallest. In the United States, 35.4% of privately held wealth is owned by the top 1% of households (Domhoff, 2013), mirroring global wealth distribution. As a result, luxury travellers and adventurers make up a smaller market compared to budget travellers, with luxury travellers expected to have the highest growth rate.
Baby boomers, born between 1946 to 1964, are now either at the peak of their careers or enjoying retirement. Wealthy boomers are projected to invest in extravagant travel experiences as they age, resulting in a rapid expansion of the luxury travel industry. Conversely, the growth of adventurous and budget travelers is affected by economic conditions and birth rates. Developed countries are facing challenges due to decreasing birth rates and a growing elderly population, which impacts the market for budget and adventurous travelers alike. The budget travel sector is highly competitive, with various choices providing comparable services but varying mainly in price.
Competing against established hotels can be challenging, as reducing prices too much may lead to a price war that harms all producers. Entering this market may not guarantee a significant market share, given the large number of firms and homogenous products. However, in the luxury and adventure travel sectors, hotels stand out with unique offerings. For instance, the Maison Souvannaphoum Hotel in Luang Prabang provides a cultural and scenic experience of Laos, unlike any other hotel. Luxury hotels differentiate themselves through scenic views and top-notch service, competing on product quality. While competition is high due to fewer firms in this segment, there is potential for Banyan Tree to capture a large market share with strategic investment. Marketing products to all three consumer segments will involve similar costs for Banyan Tree, including advertising on various platforms and partnerships with travel agencies.
Targeting budget travelers would be costly as new budget hotels would need to be constructed, requiring a significant amount of capital. Additionally, marketing Banyan Tree Holdings' hotels and services to this demographic would be ineffective as their product features do not align with what these consumers are seek. On the other hand, luxury travelers and adventure seekers would likely be more receptive to Banyan Tree Holdings' offerings. Ultimately, the company should focus on the luxury traveler market segment due to their potential for high growth and the alignment of their desired products with what Banyan Tree Holdings offers.
Companies in the travel industry have a range of options to set themselves apart, including emphasizing their location, economic value, lifestyle offerings, services and amenities, and commitment to environmental sustainability. The geographical location can highlight the cultural heritage of the destination country, attracting international tourists. Furthermore, being close to transportation centers can be a key selling point for added convenience. Economic value is about pricing products and services in a way that meets consumer expectations. Hotels can position themselves as affordable choices or upscale establishments offering top-notch experiences at a premium price.
Businesses can enhance their reputation and appeal to customers by showcasing their lifestyle, services, and unique experiences. Adopting eco-friendly practices can help companies attract consumers. Banyan Tree employs a product positioning strategy that emphasizes its geographic location, lifestyle and services, and dedication to environmental sustainability. Each Banyan Tree property is meticulously designed to harmonize with its natural environment, preserving the landscape. This focus on location positions Banyan Tree as a high-end Asian brand (Marketing in Asia 2nd Ed p714).
Angsana Hotels and Resorts are strategically situated in unique World Heritage sites, providing an authentic local experience that attracts visitors. In contrast, Banyan Tree offers guests a personalized and luxurious retreat focused on romance, rejuvenation, and exotic sensuality. Along with its premium services, Banyan Tree is committed to promoting environmentally friendly practices. Laguna Resorts and Hotels, part of the Banyan Tree group, prioritizes sustainability and supports the health and education of employees' children and local communities. This dedication to social responsibility resonates with conscious consumers concerned about nature conservation and community well-being. Banyan Tree's emphasis on luxury experiences sets it apart in the hospitality industry, as seen in their previous marketing slogan "Romance of Travel," reflecting their focus on relaxation and rejuvenation.
Banyan Tree maintains consistency across its various product types by focusing on pampering guests and providing a luxurious experience. This emphasis on luxury is reflected in the higher prices of Banyan Tree products, as consumers often associate quality with higher price points. The "Romance of Travel" campaign highlights Banyan Tree's brand as a place for romance, intimacy, and rejuvenation. Positive reviews from travelers on various websites help spread awareness of Banyan Tree and attract potential customers online. Banyan Tree also offers direct bookings through popular resort websites to cater to the internet-savvy consumer. By maintaining its reputation for quality service, Banyan Tree has garnered good reviews and continued success. Additionally, Banyan Tree engages in eco and cultural tourism initiatives, such as its Tsunami Relief Project in 2004, showcasing a commitment to awareness and goodwill.
Market Segments in Travel Industry: Luxury, Adventure, Budget. (2016, Apr 08). Retrieved from https://studymoose.com/travel-industry-and-market-segmentation-essay
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