The Use of Branding and Market Segmentation in Hotel Marketing: A Conceptual Review

This paper aims to analyse the use of branding and market segmentation from a hotel marketing perspective. The use of branding has enabled market segmentation and delivered financial and organisational growth for hotel operators. This application of marketing has increased value for the organisation and the customer by delivering a level of service that is customised to the consumer expectations and needs. Branding brings the advantage of a standard of service and leads to customer loyalty and greater customer choice. The paper supports the argument that brand creation makes the management of hotels more complex and can lead to inefficiency which the hotel management must decide if branding is a useful tactic or not. We argue that not all organisations have the resources to implement market segmentation and smaller operators find it increasingly difficult to compete against larger competitors. The modern hotel industry is increasingly competitive and market segmentation is expected to continue. Modern communications and ICT developments have eroded the value of brands and the competitive advantage they bring over smaller independent hotels. Consumer power is a growing trend that hotels must deal with and redefines their supply chain model. Brand owners are required to remember that the product and guest satisfaction should be the ultimate goal for an organisation as it increases brand value and encourages customer loyalty. Marketing and branding are cannot be discussed in isolation within an organisation and the brand principles should be carried out throughout the entire customer experience for commercial success.