TOURISM MARKET SEGMENTATION IN CONTEXT OF NEPAL

1

OUR TEAM

Jivan NepaliIOE, Pulchowk

Campus

June 18, 2013

Narayan Pd. KandelIOE, Pulchowk Campus

2

TOURISM Huge possibility of Employment

Generation

Covers 4.3% of National GDP

(2012)

So, if we can effectively market the tourism industry in Nepal & abroad?

3

TOURISM MARKET SEGMENTATION

SegmentationSmall group bearing similar behavior characteristicsMarket Segments & Target MarketMeans of implementing marketing strategy

4

WHY MARKET SEGMENTATION IN TOURISM

Natural Resources?

Cultural Resources?

5

WHY MARKET SEGMENTATION IN TOURISM

“focus resources on the customers who are most likely to be persuaded to visit their destination or to purchase their product or service”

6

DATA TO BE SEGMENTED

Tourist Details Records (TDRs)Demographic characteristics along with

purpose of visit total duration stay tentative places of visit

7

SEGMENTATION APPROACHES

A-priori Segmentation

Data-driven Segmentation

“Study shows Older People Travel More & Go Farther” - Journal of Travel Research

8

BASIS FOR SEGMENTATION

GeographicDemographicPsychographic/Life-styleBenefits

UsageLoyaltySituationBehavioral

9

BUILDING SEGMENTATION MODEL

Step 1: Selection of the Segmentation Base(e.g. Travel Motivations, Vacation Activities)Step 2: Grouping of respondents

  Step 2(a): Selection of segmentation algorithms(s)

  Step 2(b): Stability Analysis  Step 2(c): Computation of final

segmentation solution10

BUILDING SEGMENTATION MODEL

Step 3: Profiling (external validation) of segments by identifying in which personal characteristics segments differ significantlyStep 4: Managerial assessments of the usefulness of the market segments (and formulation of targeted market activities)

11

SEGMENTATION RESULTSPurpose of Visit

Data Source: Nepal Tourism Statistics Report-201012

SEGMENTATION RESULTS Travel Partners

Data Source: Nepal Tourism Statistics Report-2010

2009

2010

13

SEGMENTATION RESULTSCountry of Origin

Data Source: Nepal Tourism Statistics Report-2010 14

SEGMENTATION RESULTSSatisfaction Level

Data Source: Nepal Tourism Statistics Report-201015

References[1] Hanlan J., Fuller D., Wilde S. J. (2006). “Segmenting tourism markets: a critical review”. Southern Cross University, Melbourne, Australia.[2] Barahi S., Fan R., Hung P., Malla P., Yeung R. (2011). “Tourism Cluster in Nepal - Microeconomics of Competitiveness”. Harvard Business School, USA.[3] Angus C., Brocklesby J. (2010). “Tapping the Domestic Tourism Market”. Angus & Associates, Tourism Resource Consultants and The Knowledge Warehouse, Ministry of Tourism, New Zealand.[4] Khatri, L., B., Kayastha R., P. (2010). “Nepal Tourism Statistics 2010- Provisional Report”. Ministry of Tourism & Civil Aviation, Government of Nepal, Singh Durbar, Kathmandu.[5] Khatri, L., B., Kayastha R., P., Pokhrel M., P., K.C., J. (2011). “Nepal Tourism Statistics 2011- Annual Statistical Report”. Ministry of Tourism & Civil Aviation, Government of Nepal, Singh Durbar, Kathmandu.

16

17

Thank You!

Questions & Answers Session