CUSTOMIZATION: Targeting Demographic Sectors
by Simon Hudson

When the one-size-fits-all approach no longer works, companies must devise their marketing strategies based on the concept of market segmentation. When a market is segmented, it is divided into smaller homogenous markets or segments based on common needs or characteristics. The core advantage of segmentation is that customers will be more satisfied with the services provided because they have been designed with their needs in mind. One common criteria used by tourism and hospitality suppliers to segment the market is through demographics using the primary variables of age, gender, family life cycle, and ethnicity. So let’s look at some of the services that are being matched to specific demographics in the tourism and hospitality industry today.

Of course, the most significant implication of demographic change in this century is the aging of the world’s population. The world median age is projected to rise from 26 years in 2000 to 44 years by 2100. In Canada, the retirement-age population will rise to 21% by 2026, and 24.5% in 2051. The senior travel market is both lucrative and unique because it is less tied to seasonal travel, involves longer trips, and is not wedded to midweek or weekend travel, so it can boost occupancy rates for business and leisure travel opportunities. However, this segment will also require special amenities, such as extra help with transportation. The Stampede Casino in Calgary has recognized this need and runs a Seniors’ Trolley Bus program that picks up organized groups from seniors’ lodges and clubs throughout the city, transports them to the casino, gives them a free lunch and, of course, an opportunity for gambling and socializing at the casino.

Another attractive market for the tourism and hospitality industry is the baby boomers. This sector, born between 1946 and 1964, represents about a third of the Canadian population. The adventure tourism industry has been particularly proactive in courting this market, and 41-60 year-olds comprise the highest participating age group in this sector. They represent a growing number of aging North Americans that many in the outdoor recreation business are referring to as “bobos”- bourgeois bohemians. They are looking for an escape to nature from their stressed-out urban lives, but they want the experience without the hassle of hauling a lot of gear into the backcountry, sleeping on lumpy ground, or hunting for kindling to cook smoky, second-rate meals. Alberta-based Pure West Lifestyles & Adventures is one company catering to these “bobos”. It offers camping adventures along the foothills of the Rocky Mountains “without the hassles of packing in tents and equipment”. 

An aging population does not mean that tourism marketers should ignore other cohorts, although the children of the boomers, referred to as Generation X (born between 1965 and 1981), and Generation Y (born between 1982 and 2003) are causing headaches for marketers. Each generation has a different outlook and different values, so it is a challenge for marketers to retain older customers while trying to attract new, younger customers. According to the World Youth Student & Educational Travel Confederation (WYSE), young travelers are the travel industry’s fastest growing sector, representing over 20% of all international visitors. WYSE says that these adventurous young backpackers stay longer, spend more, seek out alternative destinations, and enjoy a wider mix of travel experiences compared with average tourists. 

Younger generations are also likely to be less responsive to traditional forms of advertising. One hotel label that has recognized this is Desires Hotels, operated by Tecton Hospitality. About 70% of guests at Desires Hotels are Generation X, and executives noticed that they were tuned into a new wave of social media or social networking via the Internet on sites like MySpace and TripAdvisor. Desires properties in Miami, San Juan, and Atlanta began to record a podcast each week about that week’s upcoming events in nightlife, restaurants, and concerts. In the three-month period following the start of the podcasts, over 100,000 people visited the podcasts section of the websites and the click-through rate to the reservations booking engine from the podcasts was a healthy 5%.

Family travel (adults with children) is on the increase, as both parents and grandparents continue to look at travel as one way in which to reunite families in a contemporary world that is increasingly dominated by the demands of work. Club Med is a good example of an organization catering to this market. Once known for its ability to cater to young singles, it now has more than 60 family-friendly holiday villages worldwide. Family travel is being encouraged by concentrating marketing tactics on the children. Airlines are also providing travel perks for children, considering them the consumers of tomorrow. Air Canada, for example, introduced a range of meals designed for children’s appetites and tastes, including many healthy options as well as souvenirs all wrapped up in a brightly coloured box. Flight attendants also distribute games and reading materials geared to different ages during the journey. 
Gender segmentation has long been used in marketing clothing, hairdressing, cosmetics, and magazines. But, more recently, it has been applied to tourism and hospitality products and services. The number of women traveling for work purposes has been growing steadily for two decades, and vocal women travelers have influenced the introduction of better-lit parking garages, higher-quality soaps and lotions in hotel bathrooms, and improved room service fare. Women are also looking to travel on their own, or with other women, for leisure purposes. The Delta Lodge at Kananaskis is targeting women travelers with its Girl Power Package that includes an $85 per person spa credit (treatment or product), a party platter, and valet parking. Canadian Rocky Mountain Resorts also offers a Girlfriends’ Getaway Package made up of one night’s accommodation, breakfast, an aromatic gift for each person from “True Essence”, chocolates, and all meal gratuities.

The singles travel market is also on the increase, accounting for over 20% of all leisure trips taken in 2007. One tourism attraction in Calgary that has been very successful at attracting singles - somewhat surprisingly - is the Calgary Zoo. This February they hosted a “Singles Safari Mad Hatters’ Party” for 40-50 year-olds (a 3-year variance was allowed). “Head to your closet or a second hand store and find your gimmick for the night to meet other hot singles between the ages of 40 and 50” was the call that went out. Guests enjoyed animal-themed games, a light dinner, a DJ dance, and the chance to show off hats to the 100 attendees of the opposite sex. 
Another target market growing in attractiveness for the tourism industry is the gay market. The findings of Canada’s first lesbian, gay, bisexual, trans-identified (LGBT) travel study determined the size of the Canadian gay travel market at $5.4 billion. The study also found that 83% of gay travelers believe Canada to be a place that goes out of its way to welcome gay travelers. Last year, a Taiwanese travel company capitalized on the success of the film Brokeback Mountain by marketing trips to southern Alberta, where the award-winning movie was filmed. Lion Travel Service offered $200 discounts to gay couples who wanted to take the tour. “We’re marketing this package especially to gay and lesbian people,” said company spokeswoman Linda Chow at the time. 

Finally, with ethnic minorities making up an increasing proportion of the Canadian population, the hospitality industry is adapting its services to cater to different cultural tastes. For example, the Stampede Casino in Calgary caters to the Chinese immigrant market by translating promotional signage into Chinese and employing Chinese-speaking staff. Management has also made an effort to learn more about Chinese culture and has put an emphasis on recognizing and honouring Chinese special events such as the Fall Moon Festival and Chinese New Year, by providing culturally appropriate food and beverages.