How can customer segmentation lead to personalization?

Customer segmentation is the way a company chooses individual people to sell their products and services to and find out the best possible way to target them and their wants and needs. Market segmentation means dividing the market or target group into groups based on characteristics from the specific market. Therefore targeting can be done in an effective and efficient way. Individuals in the same segment have specific communication tools or behavior in common. In general, a market can be divided into four different groups which are demographic, geographic, psychographic and benefit oriented (Beltman & Peelen, 2013).

A market can be segmented in different ways with different techniques. An example of a technique that can be used is the Chaid or Cart analysis and the RMF model (Peelen, 2002). By using the data of these techniques markets can be easily divided and services can be personalized.

A good example of a hotel company that uses this segmentation to personalize their experience is Hilton World Wide. Hilton Worldwide targets several segments at the same time. They do this by having different brand at the same time under the same Chain. Under Hilton Worldwide are 13 smaller brands such as Double Tree, Conrad and Hilton Garden Inn which all have their own segment. Therefore they can personalize their service for each different brand and each different segment, which works very well.

Another thing that Hilton Worldwide applies in their brand to personalize the experience for the several segments is a new app which is called Fun Finder. This app is made with the objective of being an personal travel guide. Guests who use the app can use maps, information about events, get notifications of special events and features to personalize the specific preferences of the guests. The idea behind the app is to make a personalized experience for the guests which are built on guest preference, place of the guest and at least time. The experience is personal for everyone since Hilton can make it a different experience based on the time of the day and the place you are.  Therefore the right information can be given on the right time which makes the whole experience more personalized than ever. This concept is the future since they use technology and GPS to deliver targeted messages and information (skift.com, 2016). It is a perfect way to show how they use and combine segmentation to create more personalization and hotels should definitely use this as an example to create a more personalized environment for their customers.

Bibliography

Hilton Hotels Segmentation, Targeting and Positioning – Research Methodology. (2016). Retrieved October 03, 2016, from http://research-methodology.net/hilton-hotels-segmentation/

Hilton’s Newest App Feature Ups the Game in Guest Personalization (2016). Retrieved October 03, 2016, fromhttps://skift.com/2016/09/06/hiltons-newest-app-feature-ups-the-game-in-guest-personalization

Peelen, E., & Beltman, R. (2013). Customer Relationship Management(Vol. 2). Boston: Pearson Education Limited. Retrieved September 28, 2016

 

 

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One thought on “How can customer segmentation lead to personalization?”

  1. The new Hilton app functionality is very interesting indeed and if carried out successful it will serve as a personal assistant with relevant information and services.

    Like

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