Impact of Market Segmentation and Selection of Target Market on Consumer

Buying Decisions (The Study of Marriott International in Pakistan)

Term Paper Final Report

Prepared by: Juned Ali Shah

MS Management Sciences (1221136)

Submitted to:
Dr. Zaki Rashidi
(Course Instructor)
Research Methods and Techniques (RMT)
Fall 2015
SZABIST KARACHI

Table of Contents

Abstract-------------------------------------------------------------------------------------------------

1.Introduction---------------------------------------------------------------------------------------

1.2 Preamble--------------------------------------------------------------------------------------------

1.3 Research Problem---------------------------------------------------------------------------------

1.4 Research Objectives------------------------------------------------------------------------------

1.5 Research Questions-------------------------------------------------------------------------------

1.6 Justification----------------------------------------------------------------------------------------

1.7 Limitations of Study------------------------------------------------------------------------------

1.8 Scope of the Study--------------------------------------------------------------------------------

1.9 Definition of Key Terms-------------------------------------------------------------------------

2. Literature Review

10

2.1 Type of Products and Services offered by the Hospitality Industry-----------------------

10

2.2 Market Segmentation Process------------------------------------------------------------------

11

2.3 Target Market and Factors Affecting the Target Market -----------------------------------

12

2.4 Consumer Buying Decisions--------------------------------------------------------------------

14

2.5 Variables Affecting Marketing Segmentation and Target Market-------------------------

15

3. Research Methodology ---------------------------------------------------------------------

17

3.1 Research Design ----------------------------------------------------------------------------------

17

3.2 Research Procedure-------------------------------------------------------------------------------

17

3.3 Population------------------------------------------------------------------------------------------

17

3.4 Sample and Sampling Methods-----------------------------------------------------------------

18

3.5 Research Instrument Selection------------------------------------------------------------------

18

3.6 Research Variables-------------------------------------------------------------------------------

19

3.7 Statistical Tools----------------------------------------------------------------------------------

20

4. Data Analysis--------------------------------------------------------------------------------------

12

4.1 Factors Affecting Buying Decisions

21

4.2 Descriptive Analysis of Variables--------------------------------------------------------------

21

4.3 Reliability of Data and Selected Variables ---------------------------------------------------

23

4.4 ANOVA Analysis--------------------------------------------------------------------------------

24

4.5 Correlations Analysis----------------------------------------------------------------------------

25

4.6 Hypothesis Testing ------------------------------------------------------------------------------

26

5. Conclusion--------------------------------------------------------------------------------------

15

5.1 Results ---------------------------------------------------------------------------------------------

27

5.2 Areas of Further Research-----------------------------------------------------------------------

27

5.3 Recommendations--------------------------------------------------------------------------------

28

6. References----------------------------------------------------------------------------------------

28

Abstract
The market segmentation is attractive and challenging task for markets today to capture the
market and increase customers attraction. The customers buying decisions are largely dependent
upon the market segmentation factors. The study ponders over the different factors affecting the
buying decisions and how they take decisions regarding the selection of hotels and resorts. The
studies suggest the market segmentation factors are the demographic, Geographic, psychographic
and behavioral factors. The factors influence the customers decisions are the age, profession,
education, life style, personality and locations. The Quantitative research performed to
understand the see the impact of market segmentation factors on buying decisions of customers.
The Marriott International takes as target frame and 50 Questionnaires filled from the customers
of Marriott International. The survey results show the significant relationship between the market
segmentation and selection of target market. The market segmentation factors put significant
impact on customers buying decisions particularly the location, age, profession, income and life
style. The results reveal that market segmentation are the basis of target market, and factors of
market segmentation impacts the customers decisions and evaluate the changes in decision
regarding the selection of hotels. The results implications for marketers are to understand the
market segmentation and develop the target market for the brands and then target the customers.
The consumer behavior is important to study to evaluate the ways to select the products and
brands. The market segmentation is effective tool to see the factors affecting the market
segmentation and selection of hotels and resorts.
Key words: Market Segmentation, Target market, consumer buying decisions, factors affecting
buying behavior, Marriott International.

Chapter 1: Introduction
1. INTRODUCTION
1.1. Introduction to Hospitality Industry
Today, the hospitality industry has become one of the growing and leading industries all over the
world. This is however has only became possible due to the increase in per capita income and
disposable of income of people worldwide. Besides, the change in living standards of people is
also the factor in growth of this industry. The hospitality and tourism industry is a mixture of a
variety of services industry which includes: hotels, restaurants, food places, resorts, airline
services, and others. The industry while not only serves the customer base at large, but also is
contributing in GDP and creates job opportunities (Cheng, 2010). In United Kingdom, the
industry grows every year and many UK based organizations expanding their services in various
other countries like Sheraton Hotels, Hilton Hotels, Marriott International and others. This
research study helps in understanding hospitality and tourism industry with relation to the market
segmentation and targeting. In this industry, there is great need of research on a range of issues
pertaining to the customer preferences, buying behaviors and selection of the company based on
customer characteristics and its market segments (Allin, 2006).
The Hospitality industry provides the different offers to travelers home away from their homes
and provide relaxing environment and greeting to customers to enhance their exposure. They
provide the lodging services, food and movement to different destinations to customers. The
industry not only provides the facility of residence and food, but also travelling facility and
games, sports and others interest they can facilitate with.
The Marriott International is the USA based organization. It is the combination of Hotels and
Resorts which serves its services in six continents, in over eighty countries, with over 4,000
placements and serving a wide range of customers reaching to one million per year. Marriott
International has been operating in Hotels, association clubs, resorts, managing the events and
services the customers from different occupations belonging to corporate sector, organizations,
families, and various others. Marriott International is popular due to its tasks and offer better
consumer services in order to create customer loyalty.

1.2.

Background

As the customers are becoming more and more experienced at finding best deals for hotels,
restaurants, and tourist destination, the industry players face intense global competition. Hence,
in order to remain in competition, the hospitality and tourism companies must look for specific
targeting approach (Ruhanen & Cooper, 2004). Moreover, the customers preferences are many
and changeable, which require managers and employees of the Hotel to provide the best services
as per the customers preferences (Hallin & Marnburg, 2008). The market segmentation is the
process of customer selection which leads to target the market that the company offers its
services and products. The bases of segmentation is done through demographic, psychographic,
and geographic, and behavioral characteristics (Pickton, & Broderick, 2005). Moreover,
segmentation also helps the hospitality and tourism industry to plan the marketing activities
according to the selected customers. This will help in cost cutting and increasing the
effectiveness to attract customers (Peters, 1990e). This study helps to understand the
characteristics such as income, social class, living standards, life-style and etc. of different
market segments. The consumer behavior models study helps to find customers needs and wants
and their buying decision patterns and the market segmentation and targeting helps to target the
customers effectively with the help of promotion strategy according to the offered products and
services in order to not only increase the market share but also to forecast and plan to deliver the
value added amenities (Kotler, 2009).
The segmentation of market helps in dividing the customers into different categories/segments
which becomes as targeted market (Kotler, 2009). The target market is that type of customer
profile which knows the product and choose it on the basis of product features and attributes. In
order to communicate effectively and efficiently about the promotional plans, the industry must
be proactive in nature to know about the customers profiles (Dolnicar 2002). In this study, the
focus is to investigate the type of customers in tourism organizations and select the hospitality
industry in which to select various organizations based on loyalty satisfaction and the set of
leisure being provided by them. The type of customers for investigation will include: loyal
customers, price conscious, product quality conscious, and wandering customers according to the
set of target market. The hospitality based organizations focus on customer preferences and try to
study their behaviors which involve them to do research in order to develop better services, guide

customers, and to create loyal customers. Enhancing the loyalty of customers has become a wellliked topic for managers, consultants, and academics. The reason behind this is simple to
understand. The loyal customers are more likely to stay with a same company and spend more
money (Reichheld and Earl Sasser, 1990; Zeithaml, 2000). This way, the company can reduce
various unnecessary costs which are occurring due to ineffective communication methods and
providing un-matching customer services which lead to better overall services provider and
increasing profitability.

1.3.Research Problem:
Now a day few current issues are faced by the marketers in tourism and hospitality industry with
respect to the marketing activities, and this study describes the issues and possible outcomes for
market segmentation and target market selection while understanding the details of the type and
purchasing pattern of customer.

The choices of customers vary and each customer type requires possible solutions for

tourism accordingly.
The customer decisions are based on demographic, psychographic, and geographic

factors, thus the change in any factor leads to change in decision.

Marketing communication and campaigns effectiveness has been decreased in terms of
mass marketing, requiring an effective way of marketing actions for each type of
customer and target market selection.

1.4.

Objectives of the Study:

To know that how the basic factors shaping the market segmentation and do impacts on

the decision making process.

To evaluate the different factors which shape the target market and its impact on tourism

industry.
To analyze the dissimilar type of Marriott International customers and purchasing

decisions towards hospitality businesses.

To evaluate the marketing campaigns effectiveness and its effects on customer attraction.

1.5. Research Questions:

What are those basic and various factors which are shaping the market segmentation and

target market?
What is the basis in doing market segmentation and market targeting in hospitality

industry and in Marriott International?

What type of customers in hospitality industry exist and how they make purchase
decisions towards this industry?

1.6.

Justification:

The hospitality and tourism industry is one of the growing and leading industries in the world. It
not only contributes into the GDP of the country, but also creates job opportunities. However,
though there are lots of effort is done by this industry to attract the customers, more of the study
is needed to understand the type of customers and their decisions towards the hospitality
organization. Hence, it is of importance in understanding the segmentation and target market and
the factors which affect the decision making in order to attract the customers with the help of
proper marketing communication and promotional strategies.
1.7.

Limitation:

The limitation of the study will be conducting the research at Marriott International at Karachi,
Pakistan only. This is due to the fact of limited time and resources.
Survey will be conducted from the customers visiting at Marriott International in Hospitality and
Tourism Industry.
1.8.

Scope:

This study is based on the marketing efforts made by organizations in the hospitality and tourism
industry to create awareness and attract the customers. Generally, the organizations in this
industry do mass marketing communication and apply the same strategy for promotion for all
type of customers which in result leads to high in cost and minimal awareness and customer
attraction due to the fact of not properly understanding their market segments and target market.

1.9.

Definitions of Key Terms:

8

Hospitality: its a friendly, warm, and generous reception and entertainment of guests, visitors, or
strangers (Walker, 2007).
Tourism: The commercial based organization which operates to facilitate holidays and visits for
the places of interest. (Walker, 2007)
Segmentation: its a process of dividing the market into segments which are definable and
accessible form. In other words, segmentation helps companies to sell products to a particular
group since its impossible to target entire population (Kotler, 2006).
Promotion: is a way of publicizing the product, brand, or business to sell things or spread
awareness. (Kotler, and Keller, 2009)

Chapter 2: Literature Review

The tourism and hospitality industry grow rapidly around the world which serves customers
needs with relation to leisure, traveling and tourism. Due to the increase in disposable income
and per capita income, the demand of hospitality and tourism industry grows, and the better
living style. Various tourism and hospitality based organizations expand their businesses in other
countries and serve the customers. The industry not only creates job opportunities and help in
reducing the unemployment rate at some point, but also contributes into Gross National Product
(GDP) and National Income. Besides, it facilitates to increase places for people to visit various
destinations. This industry has customers who have a variety of characteristics and they select the
organization which offer services matching with their requirements (Morrison, 2010).
Various organizations in tourism and hospitality industry offer various services, similarly
Marriott International does. However, Marriott International believes on two major factors of
success which include honesty and integrity in their work which makes the organization as
market leader by strictly following its vision and mission statements. The firm has created its
value based on honesty, integrity, hard work, and safe and secure environment (Gunter, 2002).
Marriott International is not only limiting its focus on business events, but it also is very much
interested in serving the individuals and families. With new trend in living styles, people are
more interested to hang out and visit various places, such as, restaurants, beaches, and other
entertaining and recreational places and this phenomenon is very much important for Marriott
Hotels and Resorts to better understand its customers needs and wants in order to efficiently
meet with those needs and desires (Peter, 2006).

2.1 Type of Products and Services Offered by the Hospitality Industry

The industry consists of hotels, motels, restaurants, inns, and resorts. The business nature of
hospitality and tourism industry is both national and international whereas in accommodation
point of view, it provides different ranges from luxury to budget hotels, from tourism spots and
resorts to motels and health spas (Ghosh, 2006). The marketing activities carried on by Marriott
International are focused on business traveling and leisure time. The services offered by the firm
are customer centric through which customers from different categories avail these services as
10

per their requirement, such as some customers enjoy with their family and friends and have fun,
therefore for this purpose Marriott International had also introduced family resorts for those
customers so that they can entertain themselves (Mercer, 1998).
Marriott International has secured its position based on its wide range of products and services
offered in hospitality and tourism industry. The firm puts its all energies like time, money and
struggle to identify those factors which are related to customers needs, wants and desires. People
generally are purchasing those brands and products which are matching with their social class,
purchasing power, income level, and various other factors which are occurring on the basis of
marketing segmentation (Kotler, 2006). For customers, those products and services which are
satisfying their needs and wants are preferred over others which are not meeting their demand
criteria as the satisfying products or services are actually the solutions to their problems.

2.2 Market Segmentation Process

Market segmentation thus is taken into action in order to create those products which offer
solutions to the problems to a particular segment of customers and to differentiate the brand
image from the other brands in that product solution category. As there is a wide range of
products available in market, firms try their level best to customize their products to meet the
customers requirements. This phenomenon is of market segmentation is not just limited with the
commercial organizations but also non for profit and other organizations too (Kotler and Sidney
1969). In hospitality and tourism industry customers might have similar way of purchasing
behavior such as in terms of enjoyment, fund and other entertaining and recreational activities
(Kotler, Keller and Lane, 2009).
The Marriott International is the USA based organization. It is the combination of Hotels and
Resorts which serves its services in six continents, in over eighty countries, with over 4,000
placements and serving about 1 million customers every year. Marriott International operations
include as in Hotels, membership clubs, resorts, event management and service the customers
from different occupations which include corporate customers and other households. The
Marriott is popular for their services and customer attention creates the long term value for
customers and builds long term relationships.
11

The first step in market segmentation is to select a product or service which is to be offered to the
customers and of what category that product or service is. The second step directs to follow the
segmentation basis. This basis consists of four criteria. The criteria to follow four factors which
lead to an effective market segmentation process includes; measurability, accessibility,
substantiality and actionality. This step however requires managerial skills, creative thinking and
insights of the market. The third step guides to analyzing profiles. Analyzing profiles is made to
identify the type of customers, their needs and wants, purchasing power, growth rate, frequency
of purchases, brand loyalty and to forecast long term sales and profit. The fourth step is to
finalize the market segment and select the target audiences from these segments. This leads to
plan marketing mixes accordingly for a company (Lamb and McDaniel, 2003).

Criteria for Effective Segmentation

There are a number of factors which help in achieving effective segmentation however the most
prominent are four which include, market segmentation should be; measureable, accessible,
substantial, and actionable. 1- Measurability tells about the size of the segment and the buying
power of the consumers. 2- Accessibility tells about that the segment must be easily and
effectively be served. When the segment is available, the company can not only serve customers
easily, but also it can make the products or services without any time taking. 3- Substantiality
considers that the segments which need to be targeted are profitable enough to serve. For any
companys survival, substantiality is very much important. 4- Actionality refers to the fact that
its not important that only the segment size should be large enough, but it is also important for a
company to know that it has enough resources to execute their plan in order to serve its
customers.

2.3 Target Market and Factors Affecting the Target Market

To reach a specific market segment through product or services, the marketers need to closely
understand the needs and wants of that particular market segment in a particular industry.
Moreover, since the customers needs and wants are constantly changing over a period of time,
hence it is very much important for the marketers to monitor those changes in trends in order to

12

continuously satisfy their customers demands. Day by day, customers want changes and
something always new in their lives, and for this reason, organizations should be proactive to
conduct surveys to gain as much as possible information about those changes. In tourism and
hospitality industry, the organizations have established a separate department with the name of
Research and Development (R & D). The function of this department is to get consumer insights
of those which are in under focus segment and to utilize that information for designing the
effective strategies which help in achieving the organizational goals and resultantly overall
success (Pearson and Gessner, 2003).
In hospitality and tourism industry, the role of organizations is to satisfy customers while keeping
their goal of future growth and profitability intact. Whereas on the other hand, customers needs
and wants play vital role in designing and manufacturing the products and services by the
organizations which these organizations are producing while considering the customers. This
gives opportunity to an organization to manufacture things accordingly which the customers
would buy them immediately (Armstrong, Gary, and Kotler, 2005).
In market segmentation process, every single factor which affects the specific market segment is
carefully calculated in terms of size, nature, income level, taste and other behavioral factors of
customers along with their needs and wants for satisfying and solving the problems. In
hospitality industry, once these segments are identified, the marketers communicate their
products and services through advertisements so that end results can be achieved (Gunter, 2002).
Marketing segmentation strategy helps to locate the right customer portfolio which is beneficial
for the company in terms of buying its products or services. Market segmentation is done on
various factors, however the important ones which marketers pay attention to use are three
including; demographic, geographic and psychographic (Kotler, 2006). These factors play an
important role in devising the product category and overall decision process of the company.
Market segmentation is key to success in targeting the right set of customers from the whole
market in a particular product category (Kotler et al., 2009).

13

2.4 Consumer Buying Decisions

Customers preferences get change over a period of time. Similarly, their preferences for any
product or services constantly change too which are influenced by changing market trends. As
the previous preferences of the customers are not static and change with the flow of time, hence
marketers are needed to monitor those subtle changes and continuously improve their products or
services according to the customers expectations. The behavioral changes occur in customers
when an organization brings change in its products or services, such as minimizing the traveling
prices, the food offered and the accommodation etc. (Engel, 1998).
Organization performance is significantly affected with relation to the demographic factors.
Moreover, when changes occur in factors such as life style, age, income level of people, it
considerably impacts on decision making process (Kotler et al., 2009).
In hospitality and tourism industry, there are various type of customers who visit with their
family and friends for enjoyment purposes or on business purposes. The type of customers
includes for example include loyal customers, impulse buying customers, and discounted
oriented customers etc. From these, the most important customer is loyal customer. This shows
that the customer is very much satisfied from the services and products offered by the company,
therefore, the company must be flexible with the customer and make the customer feel being
important and as a part of the company (Gunter, 2002).
On the other hand, discount oriented customers are also important for the organization. This is
due to the fact that these customers are always ready to buy the things which are remained as left
stock. Moreover, these customers are known as cash flow participators. The impulsive oriented
customers are those customers who shop when they are exposed to the new advertisements and
other communication efforts via different communication mediums (Kotler, 2006).
There is also another category of customers who are buying things based on need. Need based
customers buy things when he is caused by a need factor. This type of customer only enters a
shop to purchase a thing which he is needed, and if he doesnt find then he will leave the shop
and check on other one to fulfil his need. Such need can be either basic need or occasional. The
interesting fact is that need based customer is difficult to deal with and satisfy as compare to
other type of customers. For an organization, these all type of customers are very important and
14

the organization must fulfil their customers desires and when this is done, the organization
becomes number one in a particular industry (Rank, 1992).
Customers today have become very intelligent and they know about the things. Thus, companies
must be aware of it and should ensure the quality and features are of optimum. Selling something
is an art. The sales representatives must be aware about the buying behavior of the customers in
their shops in order to convince customers buy something. Since the customers have become
savvy, it has become challenge for the companies to offer those products or services which
satisfy customers needs and wants, and this leads to the competition where organizations are
becoming alert on gathering information about the customers for effective decision making
(Engel, 1998). Loyal customers are significant to any organization and they always spread a
positive word of mouth. Moreover, this type of customers is creating companys cash flow (Rust
and Zahonik, 2007).
In hospitality industry, the organizations are trying to segment the customers into different
categories and design the marketing mix which are specified to certain group of customers (Rust
and Zahonik, 2007). Besides, marketers design differentiated marketing strategies to reach
maximum number of customers through different styles, quality patterns and attributes. Like for
example Marriott International creates various ways of differentiated products and services for
different customers (Rust and Zahonik, 2007).

2.5 Variables Affecting Marketing Segmentation and Target Market

The purpose behind marketing segmentation is to meet the demands of customers and create the
value for not only organizations but also for the customers. This helps in increasing satisfaction
level. Along with the factors considered in market segmentation, it is also very important to find
those factors which influence on customer buying decision and process (Page, 2009). With
change in living styles, the needs of customers are also increasing and changing. To better satisfy
their needs, customers are moving towards urban areas from the rural ones. Marketers therefore
are more focused towards the customers who live in urban areas so that they can have better
chance of achieving the goals set (Peters, 2006). Demographic factors include age, sex, income
15

level, social class, family size and etc. in order to create a segment based on these factors and to
target the untouched customers. Psychological factors include class of people, attitude and
behavior towards a product. With considering the psychological factors, the organization can
create segmentation to reach that group of customers who is untouched but is very profitable
(Weinstein, 1994). Geographic factors include city, country, nations and etc. And in tourism and
hospitality industry, these factors mean a lot for effective marketing segmentation (Martin,
2002).
Identifying likes and dislikes of the customers is crucial for an organization while segmenting the
markets because it affects the organizational performance. Marriott International uses a very
strong strategy in segmentation process to achieve its goals. Moreover, the company effectively
does the marketing campaigns in order to make customers know about their products and
services offered with relation to the customers desires. When the customers are not the loyal
ones, they tend to switch from one brand to another. Thus, organizations try their best to keep
improving their products and services to meet with the customers expectations. Furthermore,
with changes in preferences of customers, the organizations conduct regular researches to find
out the latest information in connection to the customer preferences in order to serve those
customers as per their preferences patterns.

16

Chapter 3: Research Methodology

3.1Research Design:
3.1.1 Research Paradigm
In this research the approach used is Positivism. In this approach we focused on the field of
study is based on existing facts and theories are available to follow and evaluate the differences.

3.1.2 The deductive approach will be used to check the market segmentation and target
market factors in hospitality industry and more specifically in Marriott International.

3.1.3 Research Strategy: In this research the study will be conducted based on descriptive
method in order to understand the facts and factors affecting the segmentation process. The
method will be helpful in understanding the market segments and target market selection; hence
it will help in designing the communication and promotion strategy for Marriott International.

3.1.4 Research Technique:

The research technique for this research will be quantitative one. This selection type is based on
the research design and type of results required for the study which is more facts and figures,
hence quantitative research technique is the best possible technique to be applied. The
Quantitative research technique is to be conducted in order to investigate about the market
segments and target market for Marriott International with relation to understand the different
characteristics about the customers for decisions they take to select the tourism and hospitality
organization.

3.2Procedure:
1. The primary data will be collected at Marriott International Karachi. In this regard the
customers will selected on convenient basis and will be asked to fill the questionnaire.

3.3Population:
The population in this research is all the customers in hospitality and tourism industry.
3.3.1 Target frame: The customers of Marriott International are the target population we want to
study.

17

3.4Sample and Sampling Method:

The sample size will be 100 customers of the Marriott International. The reason behind this size
selection is the availability of the customers at the vicinity during the data collection process and
in limited time.

3.5Instrument Selection:
The data will be collected from primary sources. In this regard, questionnaire will be used as a
data collection instrument. The Self-Administered Questionnaire will be helping to know about
the defined variables and factors and how these are affecting the decision making and customer
selection.

18

3.6 Variables and Conceptual Framework

The theoretical framework for this research is to evaluate the impact of consumer buying
decision in hospitality industry and specifically for Marriott international. The buying decisions
are based on different factors that are the market segmentation factors.
Dependent Variable: The impact on customer decision selection of Marriott International.
Independent Variables: The variables form psychographic, demographic and geographic and
behavioral factors.
Figure 4: Factors Affecting Customer Buying Decisions

Hypothesis formation based on variables;

H1: There is a positive relation between the Demographic Variables and Customer buying
decisions.
H2: There is a positive relation between the Geographic Variables and Customer buying
decisions.
H3: There is a positive relation between the Psychographic Variables and Customer buying
decisions.
H4: There is a positive relation between the Behavioral Variables and Customer buying
decisions.
19

3.7 Statistical Tools:

The SPSS computer software will be used to analyze the quantitative data and applying the tests.
MS Excel will be used to construct the graphs.

20

Chapter 4: Data Analysis

The customer segmentation is the study of understanding the different market segments and
evaluates the buying decisions of customers. The buying decisions of customers depends upon
the various factors includes the demographics, Geographic, psychographic factors. The
Quantitative technique for data collection will be used. The data collected from the customers
through questionnaires will be analyzed through the various methods of analysis and results will
be presented in the form of tables and charts. The descriptive analysis, regression, correlation &
multiple regression analysis, ANOVA, R2 and T-taste will be apply to verify and analyze the
result and evaluate the impact of exports on foreign exchange earnings. By proving empirical
findings, several tests are going to be applied to check the validity of the data. In this concern, I
will use the SPSS Software to see the relationship to derive the all the results and develop the
graphs and charts for the analysis. Following few model and techniques are used to analyze the
results of primary data;
4.1 Factors affecting Buying decisions
The above table shows the participant of research, Marriott International customers. We involved
the participants with varying in their demographic characteristics so that the results can be
effectively verified and analyzed. As these characteristics affect the decision making, the age of
25 years old might be needing changed facilities, whereas age of 45 need different features, so
that we collected responses from different respondents to cover the population in general.
Segmentation helps in making segments of customers where the customers are divided on the
basis of their characteristics and attributes. Market segments are created to serve the customers
who carry same taste and preferences and to satisfy their needs and wants though various
products and services. Serving this way leads to create loyal customers. However, at some point,
some marketers believe in mass marketing. In mass marketing, marketers decide to have a single
product or service to offer to all the customers present in the market. Mass marketing is opposite
to the market segmentation strategy which focus on all type of customers by neglecting the fact
of differences in customers profiles.

21

4.2 Descriptive Analysis of Variables

The Descriptive analysis will be processed to see the frequency on different responses to
evaluate the customer segmentation and selection process of customers on hotels and resorts.
The descriptive tests will be applied include Mean, Standard Deviation, the measures of
skewness and kurtosis.
Table 1: Descriptive Analysis

Valid
Missing

Mean
Median
Mode
Std. Deviation
Variance
Std. Error of
Skewness
Std. Error of Kurtosis
Range
Skewness
Kurtosis

Statistics
Do your
Do You
Education
consider the
and
location of
Profession
Hotels and
affects your
Resorts?
choices of
Visit to
Hotels and
Resorts?
50
50
0
0
5.0000
4.0200
5.0000
4.0000
5.00
4.00
.00000
.65434
.000
.428

Do You
Consider City
and Country
for selection
of Hotels and
resorts for
tourism?

50
0
3.3400
4.0000
4.00
.82338
.678

.337

.337

.337

.662
.00

.662
2.00
-.020
-.554

.662
2.00
-.718
-1.139

22

4.3 Reliability of Data and selected variables

Table 2: Management Sample

Reliability Statistics
Cronbach's Alpha

.723

N of Items

The reliability test shows the values of Cronbachs alpha on selecting the 4 independent and one
dependant variables. The customer segmentation affects the buying decisions of consumers. The
value of Cronbachs alpha at standard level 0.7 means 70%, which is acceptable limit. The
results at total numbers of items and including the all 4 independent variables are the 0.723
shows the results are reliable and data is consistent and can be use further results. The items are
interlinked and results are significant we can apply the correlation for hypothesis testing and
ANOVA by seeing the relationship among variables.

23

4.4 ANOVA Analysis with responses of different demographics characteristics

Table 3: ANOVA
ANOVA Analysis with responses of different demographics characteristics
Sum of Squares

I select Hotels and

resorts and based
on my family
choices

Between Groups

df

Mean Square

.056

.056

Within Groups

83.911

118

.711

Total

83.967

119

.001

.001

20.924

118

.177

20.925

119

.001

.001

20.924

118

.177

20.925

119

.001

.001

20.924

118

.177

20.925

119

I select Hotels and Between Groups

resorts and based Within Groups
on my Income
Total

Do you think

Between Groups

Difference of

Within Groups

Sig.
.078

.0780

.003

.0955

.003

.0955

.003

.0955

.003

.0955

Education decisions Total

are different
towards tourism
and hospitality
organizations
Do your Education

Between Groups

and Profession

Within Groups

affects your choices Total

of Visit to Hotels
and Resorts
Do You Consider

Between Groups

.000

.000

City and Country

Within Groups

.000

118

.000

.000

119

.001

.001

20.924

118

.177

20.925

119

for selection of

Total

Hotels and resorts

for tourism
Your selection of
Between Groups
Hotels affected due
Within Groups
to personality and
Total
life style

24

The table above shows the customer group sample response which possessed a variety of the
demographic characteristics. The degree of freedom is 1 in all of the responses and shows 90%
above significance level in all the responses. This helps to elaborate that there is robust
connection of demographic characteristics in a range of factors. The different items are rated for
significance at P=0.05 and less, table shows the items are significant and F Statistics is also
significant. The Data shows the reliability as we discussed above and useful for analysis. From
the ANOVA we can evaluate the interrelationship between the items and different variables
affects the buying decisions of customers.

4.5 Correlation among variables and their significance

Table 4: Correlation of variables
Gender

Monthly

I select Hotels

I select Hotels

Do you think

Income

and resorts and

and resorts

Difference of

based on my

and based on

Education

family choices?

my Income?

decisions are
different
towards tourism
and hospitality
organizations?

Pearson Correlation
Gender

Sig. (2-tailed)
N
Pearson Correlation

Monthly Income

Sig. (2-tailed)
N

I select Hotels and

Pearson Correlation

resorts and based on my

Sig. (2-tailed)

family choices?

I select Hotels and

Pearson Correlation

resorts and based on my

Sig. (2-tailed)

Income?

Do you think Difference

Pearson Correlation

of Education decisions

Sig. (2-tailed)

are different towards

N
Sig. (2-tailed)

50
**

.385

.385**

-.185

-.315*

-.196

.006

.0199

.026

.0173

50

50

50

50

**

.262

-.709**

.000

.066

.000

.006

.631

50

50

50

50

50

-.185

**

-.063

-.826**

.663

.000

.631

.199

.000

50

50

50

50

50

-.315

.262

-.063

.372**

.026

.066

.663

50

50

50

50

50

-.196

**

**

**

-.709

-.826

.008
.372

.173

.000

.000

.008

50

50

50

50

50

.000

.000

.270

.007

.008

25

tourism and hospitality

50

50

50

50

The Correlation is the relationship between the variables market segmentation factors affects the
consumer buying decision. The selection of hotels based on income, locations, education, and
professions customers buying decisions. The significance level of 0.05 less than that is
significant.

4.6 Hypothesis Testing

Table 5: Hypothesis Testing
Hypothesis
H1: There is a positive relation between the
Demographic Variables and Customer buying
decisions.

Accepted /

Significant level

Rejected

(95%)

Accepted

0.03

Accepted

0.02

Accepted

0.00

Accepted

0.01

H2: There is a positive relation between the

Geographic Variables and Customer buying
decisions.
H3: There is a positive relation between the
Psychographic Variables and Customer buying
decisions.
H4: There is a positive relation between the
Behavioral Variables and Customer buying decisions

The above tables show the hypothesis testing of alternatives. Under 0.05 we reject the entire null
hypothesis and accept the alternative hypothesis. The variables selected for the testing are the
factors affecting the customers segmentation. The significance form the correlations shows that
all are impacting the buying decisions under P=0.05 and shows strong significance with
variables. The demographic variables show the positive correlation on customer buying
decisions. The Geographic variables impact the customers buying decisions with 0.02

26

50

significance. The Psychographic variables also positively impact the consumer buying decisions
at 0.00 significance.

Chapter 5: Conclusion
5.1 Results
The study reflects the understanding and analysis over market segmentation and development of
target market. The market segmentation is based on four variables includes the demographic,
behavioral, psychographic and geographic variable. The demographics variables are very
important to understand the target market. There are varieties of factors affects the decision
making of customers. The age, education, gender affects the decision making of customers, and
customer choices differ due to different location, behavior and selection of attributes and
features. The tourism industry is the combination of many sectors and hotels are very significant
in terms of industry services. The factors shape the selection of hotels is the income, purchasing
decisions, profession and others. The market segmentation is the process of selection of hotels
and resorts, and based on the importance of different factors.
The Market segmentation factors like age gender, income, professions, education, town, city,
region, social class, status are highly influenced factors. Through these factors we come to know
the target set of customer by conducting the primary research with the help of Questionnaires
filled from the customer and likely to be customer of Marriott available in online media and
marketing channels. The results shows the tendency towards decisions of customer in hospitality
sector differ due to purchasing power and living standards. This research helps Marriott to
integrate marketing and communication strategy to target their specify set of customers rather
than mass marketing. The marketing segmentation is the process to create value and understand
the factors to increase potential the of selection of target market.

5.2 Areas of Further research

The research conducted in the field of management sciences and on consumer behavior. The
study reveals that market segmentation affects the consumer buying decisions. The research can
be generalized in the field of consumer behavior and understand the buying decisions of
27

customers in hospitality industry. The further research can be performed on the same topics by
adding few other variables and can see the impact on purchase decisions. The same research can
be performed in other industry with same topic as in the field of telecom sector and fast foods the
various researches are warming issue. The study can be conducted to analyze the target market
and positioning strategy for customer to know the customer behavior and purchasing decisions.
The study can be conducted to mediums where customer available for selection of products and
services in their search behavior pattern.
5.3 Recommendations
The Tourism and Hospitality industry is growing and understand the consumer behavior by
selection of hotels and resorts. The study reflects the findings buying decisions of customers. The
research is helpful for market development strategy and market segmentations.
1. The market segmentation process helps to understand the market segmentation and
positioning and develop the market to attract more customers.
2. The market segmentation factors are significant to study and can be recognize as critical
variables for understanding of the markets.
3. The target market helps to understand the different type of customers and their selection
of decisions, must involve customer for feedback and research so that they remain the
part of decision making.

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