The Hotel Market

Segmentation
Workbook
A Guide for Groups & Meetings
Table of Contents
Identifying Standout Segments 6
Assessing the Customer Waterfall 11
Identifying Core Competencies & Weaknesses 16
Pinpointing Target Personas 22
Determining Product-Market Fit 28
Measuring Market Competition 31
6 Keys to Avoiding Segmentation Pitfalls 36
Introduction
No hotel can be everything to every customer. It’s a This process of segmentation is the key — to
simple truth with powerful implications: Hotels and the right bookings, business mix, marketing,
chains have to be realistic about the things they can distribution, revenue management, product,
offer well. Just as importantly, they need to pinpoint and, of course, more profit. Without it, there is no
the right customers to target with those offerings. groups and meetings strategy. This is the reality
for big-box brands, small chains, independent
Properties and chains are quick to solve these hotels, boutiques, and beyond.
riddles for transient business. Group business, on
the other hand, doesn’t always get its due diligence. In the following pages, strategy teams will
At the end of the day, this means a significantly work through a series of segmentation
smaller slice of a $130 billion dollar a year* hotel exercises designed to reveal exactly which
meetings & events pie. group personas to target and — perhaps most
importantly — why.
Dividing the broader groups and meetings market
into segments forms the foundation for a more
targeted approach. Different groups have different
needs, different acquisition costs, different timelines,
and different profitability. It’s within all of these
differences that a true picture of revenue potential
is found. By identifying high-value groups, teams
can better focus their resources, investing their time,
efforts, and money in the segments that signal the
most ROI.

Source: Kalibri Groups & Meetings

Special Report
A Note Before We
Get Started
Identifying the right target customer segments is
a process of both looking outward and inward.
These exercises will involve focus on both the
broader groups and meetings market as well as a
hotel or chain’s specific strengths and weaknesses.

Why?
Successful segmentation relies on the ability
to pair information about the market together
“Selling to people
with information about the business —
knowing particular strengths, weaknesses,
who actually want
and standout competencies allows leadership
teams to choose the group segments where
to hear from you
their business can consistently succeed. It’s a
fundamental aspect of “competitive advantage.”
is more effective
than interrupting
In the following exercises, we go back and
forth between exploring the broad market of strangers who
subsegments in the larger group segment and
exploring the unique competencies of a hotel
or chain’s group offering. By the end, a set of
don’t” Educator
Peter Drucker
& Father of
three specific customer segments will reveal Management Theory
themselves, showing teams where they have the
best ability to win clients and maximize revenue.
 72%
of event professionals (both
planners and hoteliers)
believe that most properties
are best suited for a single
type of event.

Source: Social Tables Survey 5

Step 1
Identifying
Standout
Segments
Identify Group &
Planner Types

Instructions: Name as many group types as you

can. These could be potential customers for any
hotel event space. We’ll hone in on your specific
hotel’s customers in the next few exercises.

1. EXAMPLES TO GET
2. YOU STARTED:
3. Corporate Event Planner
4. Office Assistant Planner
5. Paid Class Instructor
6. Meetup-type Event Host
7. Planners for Sports Teams
8. Professional Performers
9. Wedding & Social Planners
10.

11.

12.

7
Analyzing Instructions:
1. Print or make a copy of the segmentation
spreadsheet below, or edit the cells directly if
Purchase Data working out of a digital copy.

2. Carry the list of group & planner types from the

last exercise onto the rows of the spreadsheet.

3. Input your space data from the last 12 months.*

GROUP NUMBER OF REVENUE TOTAL CONVERSION REVENUE

TYPES BOOKINGS RFPS RATE PER BOOKING
Bookings/ Revenue/
Total RFPs*100 # of Bookings

Why 12 months Because this allows you to capture

any changes that occur seasonally,

of data? such as during the holidays or a major

annual convention.
 Segmentation
Spreadsheet
Instructions: Use the spreadsheet
template below.

SEGMENT NAME NUMBER OF REVENUE INQUIRIES CONVERSION REVENUE

BOOKINGS RATE PER BOOKING
Bookings/ Revenue/
Inquiries*100 # of Bookings

9
List Your Most MOST MONEY SPENT

Standout (REVENUE)
1.
Segments 2.

3.
Instructions: List group segments that stand
out from the rest because of the amount
of money they’ve spent, number of times
they’ve booked, RFPs they’ve submitted, AVG. # OF BOOKINGS
and their overall conversion rate from RFP PER CLIENT
to booking. This should start to reveal which
segments are most important to your groups 1.
& meetings business. 2.

3.

TOTAL RFPS
(REQUESTS FOR PROPOSALS)

1.

2.

3.

CONVERSION RATE

1.

2.

3.
Step 2
Assessing the
Customer
Waterfall

11
Customer Waterfall 1

Instructions: Fill-out the main steps that customers

must go through when booking meeting space
at your property. This should go all the way from
finding your offering through final payment and
follow-up. An example of this “Customer Waterfall”
is on the next page. 2

6
Customer Waterfall 1 AWARENESS OF OFFERING & RFP

Example
This example shows a typical customer waterfall.
For most hotels, the process will be identical to PROPOSAL & CONTRACT
the example. If so, feel free to move forward. 2
NEGOTIATION

3 INITIAL DEPOSIT

4 EVENT PLANNING

5 EVENT SETUP & EXECUTION

6 FOLLOW-UP

13
Instructions:Now that the main steps are 1
identified, list the most important reasons for
each step from the client’s perspective. See the
next page for examples.

6
 AWARENESS OF OFFERING & RFP
1
Customer Waterfall
- The hotel shows me that it can help me meet my
unique meeting or event objectives.
- The hotel provides an easy way to submit an RFP

Example II or RFI.

PROPOSAL (RFP RESPONSE)

- The hotel sales rep communicates effectively and
2 responded quickly (<24 hours).
- The event space & amenities meet my group’s
needs.

CONTRACT NEGOTIATION & DEPOSIT

- The sales rep is invested in my event’s success.
3 - The sales rep is open to making concessions and
negotiating a fair price.

EVENT PLANNING
- The hotel makes it easy to collaborate in the event
4 planning process.
- The hotel provides tools and resources that aid
event planners.

EVENT SETUP & EXECUTION

- The hotel provides superior guest management,
5 including elevated experiences for VIPs.
- Minimal issues with AV, WiFi, and other technology.

FOLLOW-UP
- The hotel values my feedback.
6
- There is a loyalty program I can take advantage of
for future meetings.

15
Step 3
Identifying Core
Competencies &
Weaknesses
Core Competencies So far, you’ve grouped clients into discrete group
types and identified your best segments. Now it’s
time to talk about your hotel’s core competencies
& Weaknesses (or strengths) and weaknesses.

Remember to be realistic and honest as you go

through this exercise. Collecting feedback from
planners, talking to your hotel staff, and looking
to your competitors are effective ways to identify
areas where your hotel(s) excels or has gaps.

Not only will this exercise help you narrow down

your target group personas, it will also give you a
good idea of what value propositions are likely to
attract business.

On the next two pages, you will be instructed to

identify your top five core competencies and top
five weaknesses.

17
Instructions: To help you get started, we’ve pre-
populated the boxes below with several areas
where your hotel(s) may excel or lack.

Complete the boxes below by adding other

important areas or replacing the examples with
elements that are a better fit for your property
(if applicable).

PRICE PROXIMITY
few or favorable fees (ex: attrition fees) close to (airport, experiences, dining)

group loyalty program onsite parking

consistent pricing easy access to public transportation

low cost event space

SERVICE SPACE
quality of F&B (if applicable) beautiful outdoor area

cutting edge AV & presentation tech multiple breakout rooms

surprise and delight customers networking spaces (ex: rooftop bar)

 37%
of planners cite bad
communication as the
#1 reason they choose
another hotel. Your
strengths or weaknesses in
communication are crucial
elements of your service.

Source: Social Tables Survey

Instructions: Now, repeat the exercise. This time,
identify where your offering may be falling short in
the same four key areas.

PRICE PROXIMITY

SERVICE SPACE
Instructions: Drawing from the previous page,
select your top five core competencies and top
five weaknesses.

COMPETENCIES
1.

2.

3.

4.

5.

WEAKNESSES
1.

2.

3.

4.

5.

21
Step 4
Pinpointing
Target Personas
Choose Instructions: Return to your Group Segment Data Template and
spend a few minutes considering all of the information gathered
thus far.Think about the top segments from each box on page 10.
Three Think about the customer waterfalls and the key needs of customers

Potential throughout the process. Finally, consider the core competencies of

your business from the last two exercises.

Target Now, make a mark in the “Target Group Vote” column of the
segments list for each meeting or event type that you believe has
Segments the best alignment between your hotel or chain’s strengths and the
overall waterfall of customer needs. Keep in mind that segments
who are already spending a lot of money or booking a lot of events
with you indicate a strong fit.

Do this individually first! Each team member should select three to

five segments to “vote” for as a target segment. Then, add-up the
tallies for each segment and identify the top three vote-getters.
These are your target segments.

SEGMENT A SEGMENT B SEGMENT C

COFFEE SHOP

23
 Identify Needs Instructions: From the final customer waterfall you
designed, select which 3 sub-attributes are the
most important across the entire process. In other
by Customer words: If only three of these “purposes” were
delivered 110% by the hotel, which three should

Segment they be? Do this for each of the three personas.

When you’re done, transfer those three points to
the profile for each persona on the next page.

SEGMENT A SEGMENT B SEGMENT C

Three most important Three most important Three most important

needs:: needs: needs:

Three most important Three most important Three most important

expectations: expectations: expectations:
 Instructions: For each of the three segments you
choose, create a profile using the template on the
following page. Fill in the three most important
Make Customer needs that you identified for each segment on
the last page, as well as the three characteristics

Profiles that make them a viable, high-value fit for your

property. A completed example is below.

*Note: While giving your segment a name

and picture may seem trivial at first, this type
of persona work can make it easier for team
members to remember, grasp, and put
themselves in the client’s shoes.

SEGMENT NAME: Training Theresa

INDUSTRY: Corporate

SPENDING TIER: Economy

MOST IMPORTANT ATTRIBUTES:

1. Flexible attendee counts
2. Copy center onsite
3. Space is clean and professional

ACTIVE TIME OF YEAR IS:

Jan-Apr (annual corporate trainings)

LEARNS ABOUT EVENT SPACE FROM:

Local HR Professionals Group
Yelp / Google Reviews
Referrals from co-workers

25
SEGMENT NAME:

INDUSTRY:

SPENDING TIER:

MOST IMPORTANT ATTRIBUTES:

1.
2.
To help add a
3.
visual identity to
this segment, find
ACTIVE TIME OF YEAR IS: a representative
picture and place
it here.
LEARNS ABOUT EVENT SPACE FROM:
 SEGMENT NAME:

INDUSTRY:

SPENDING TIER:

MOST IMPORTANT ATTRIBUTES:

1.
2.
To help add a
3.
visual identity to
this segment, find
a representative ACTIVE TIME OF YEAR IS:
picture and place
it here.
LEARNS ABOUT EVENT SPACE FROM:

27
Step 5
Determining
Product-Market Fit

Find Your
Product-Market Fit
Product-market fit is the degree to which your
offering satisfies a segment’s needs. Since you’re
not going to change what customers want, it’s
important to stay laser-focused on honing your
offering to meet the needs of target segments. In
many cases, your target segment is booking your
event space more frequently than other segments
because your offering is at least partially tailored to
STRENGTHS
NOT IMPORTANT FOR SEGMENT
WEAKNESSES
their needs. This means that honing your offering
is often times less about a completely different
approach and more about further optimization.
Instructions: Using the templates, plot the three
most important areas for each segment on the
graph, while also incorporating on the vertical
(Y) axis whether your hotel(s) excels or falls short
in each area. Then go back and place remaining
core competencies/weaknesses on the plot. Since
you did not identify these as important for any of
your target segments, they should fall to the left of
the vertical line.
IMPORTANT FOR SEGMENT
29
 Strategic
Implications for
Segments
STRENGTHS
POSITIVELY MAINTAIN
Lowest Priority
5% of resources
Don’t spend more than 5% (or a few hours on
Friday afternoon) maintaining areas where you
excel but that don’t matter much to customers.
NOT IMPORTANT FOR SEGMENT
QUICK WINS & OPTIMIZATIONS
Low Priority
10% of resources
Spend 10% (or most of Friday morning/early
afternoon) on achieving quick wins and easy
ways to optimize weaker areas that don’t matter
much to groups. Why spend any time here?
Even if an area doesn’t matter much to your
clients, doing poorly in that area may affect
general perceptions of your groups & meetings
offering negatively. For example, research has
shown that restaurants adding healthier options
on their menus experience a boost in food
quality perceptions — even amongst those
who order junk food.
WEAKNESSES
Your time, effort, and dollars are finite resources,
and you must allocate them intelligently and
strategically.
You’ll notice a percentage assigned to each box
on the chart. These boxes represent the same
chart you just created, and each one refers to the
ideal resource allocation moving forward.
ACTIVELY MAINTAIN
High Priority
35% of resources
Spend 35% maintaining areas that are important
for target segments and where you excel.
This may seem like a significant proportion of
time, effort, and money, but it’s crucial that you
maintain strength in your core competencies.
35% translates to half of Wednesday, all of
Thursday, and a bit of Friday morning.
IMPORTANT FOR SEGMENT
ACTIVELY IMPROVE
Highest Priority
50% of resources
Spend half of your time, effort, and dollars
improving areas that are weak but matter to
the group business you want to target. That
equates to an entire Monday, Tuesday, and half
of Wednesday dedicated to these areas.
Step 6
Measuring Market
Competition

31
Without giving much thought about
why, write your three biggest
competitors below.
Map Out the Instructions: Now map out your competition
in the following table, highlighting up to three
of their target segments, core competencies,
Competition and weaknesses. If you don’t have data on
your competitors’ businesses, rely on your best
guess/ judgement. If you’re unsure of their
target segments, look to their competencies,
weaknesses, and brand marketing for an idea.

TOP COMPETITOR COMPETITOR COMPETITOR COMPETITOR

TARGET SEGMENTS CORE WEAKNESSES
Up To 3 COMPETENCIES

33
 Instructions: Follow the decision tree on the
next page for each of the competitors you
listed. Oftentimes, businesses find that the other

Where Can companies they think of as competitors are

actually operating in a different part of the market.

You Win?
For example, a competitor may primarily serve
price-conscious planners, whereas you provide
a premium groups and meetings offering (with a
premium price tag).

After you identify which competitors are a direct

threat to your success among your target groups,
you can begin to pick priorities. Remember,
your property can’t do everything all at once.
Choose where to focus your scarce time, effort,
and budget based on where you can realistically
beat competitors on elements that are of high
importance to your target groups.

Start by choosing three or four specific attributes

to focus on. These might be elements of price,
event spaces, service offerings, or a mix of these
areas. While proximity is fixed, you can still think of
ways to improve your offering based on reasons
groups book with other hotels. For example, if
your property is further away from the airport
than some competitors, adding a complementary
shuttle could keep you from losing out on transient
groups (if travel convenience is a high priority for
your target segment).
 Are they competing for Yes
the same segments?

No DIFFERENTIATE YOUR OFFERING

Understand your strengths and weaknesses relative to the

competition. Choose where to differentiate yourself based
on what matters to customers and where you have a
STOP COMPETING competitive advantage.

FOR CUSTOMERS!

Should you compete on

If you are investing in
“beating” this competitor,
stop. Save your focus,
energy, and money for
winning in your target
price or product?
segments. Hint: you might be able to do both

CONSIDER FORMING
A PARTNERSHIP
If you are operating
on distinct ends of the
market and your product
and service offerings
don’t overlap, consider
partnering on advertising
or referral programs.
You may be able to pool
resources for advertising
or refer leads for potential
bookings that match you
unique offering.
Price
PICK SUB-ATTRIBUTES
OF PRICE
“Price” is not such a
simple concept. You
can lower base prices,
include concessions
and upgrades free of
charge, or offer discounts
and specials. The key
is to understand which
elements of price matter
most to your customers,
and deliver them better
than the competitor.
Product
WHAT SETS YOUR
PRODUCT APART?
Here is where core
strengths can be
especially valuable.
Identify the elements
of your product that
can be better than your
competitor and matter
a lot to your target
segments. Deliver the
better experience and
advertise the difference.
6 Keys to Avoiding MAKE IT ACTIONABLE THROUGH FOCUS

Your business strategy — from sales to marketing,

Segmentation revenue management, and the overall groups
and meetings product — should revolve around

Pitfalls your target segments. If you can’t justify that a

decision directly affects one or more of your
target segments, it’s likely it’s not worth pursuing.
Remember: Business flounders by pursuing too
many directions, not too few. Make segmentation
your friend that helps you focus. You can’t be
everything to everyone.

CREATE A COMMON LANGUAGE

Creating a common language around segments

can be a powerful mechanism to foster customer-
centricity, stakeholder alignment, and execution of
work. Use your segments in daily conversations.
Create posters of your segments to hang on the
office walls. Incorporate your segments in sales
and marketing strategy meetings. The more you
talk about your segments, the more embedded
they become in strategy and culture.

UPDATE BELIEFS

Just as markets and technologies change, so

too do segments. The needs, desires, and
characteristics of target segments will likely
evolve over time, and it’s important to keep a
pulse on these changes. Along similar lines, your
competitive position may also shift. (Think about
it: In recent years, the event industry is newly
prioritizing the creation of more engaging, holistic
experiences and non-traditional venues. Hotels
are having to evolve their offerings as a result.)
Completing this segmentation exercise annually
or biannually forces you to update and reaffirm
beliefs about your business and customers.
AVOID OVERLY
AMBITIOUS TARGETING

You might have a “reach” segment — one that

requires significant effort to acquire and satisfy
— and that’s fine. However, be cautious about
targeting segments whose primary needs you
cannot appeal to. Segments may be out of reach
because your groups & meetings offering simply
doesn’t satisfy their needs or fit from a pricing
perspective. Creating loyal, satisfied, repeat
customers among a mid-tier segment is far better
than disappointing higher paying customers
looking for a premium offering.

OVER- OR UNDER-SEGMENTATION

Being too specific or too broad in defining your

segments can make them less useful in practice. If
you’re hyper-specific (e.g., “Birthday party planners
for children ages 10-12”), you may miss large
sections of the market and not find customers to
serve. Being too broad, on the other hand (e.g.,
business clients) can leave you trying to serve too
many customers without enough focus to tailor
and optimize your strategy.

NOT USING RESEARCH IN SEGMENTATION

Our intuition is fallible and should be

complemented with data. Make use of your
transactional & behavioral data to inform your
segments and guide your “belief updates” about
your segments. Furthermore, using surveys and
in-depth interviews with planners can inform
customer needs, price sensitivity, and the actual
importance of various elements.

37
Planners & properties, attendees & events — it’s not easy bringing everyone
together. So in 2011, we set out to change the way event spaces are
sourced, designed, and executed by introducing better collaboration
between planners and properties. Today, we’ve evolved Social Tables into
an innovative platform offering the hospitality industry’s leading solutions for
event sales, services, and group distribution. All to help the world create the
best face-to-face events.

To learn more about Social Tables and our revenue-driving platform,

visit www.socialtables.com.