Spa market segmentation according to customer preference

Abstract

Purpose – This paper aims to segment spa customers based on their preferences for a set of spa attributes. With the considerable growth rate of the spa market, it is vital for spa professionals to understand spa-goers’ preferences. However, academics and industry professionals have not devised a structured method by which to manage spa customers. Design/methodology/approach – A survey was conducted using a face-to-face survey with visitors to Hong Kong who had visited a spa. By applying conjoint and cluster analysis, customers could be categorized into distinct segments. Findings – Four customer segments were identified: spa enthusiasts, high spenders, value seekers and price-sensitive spa-goers. Spa enthusiasts were the largest segment among the four, followed by value seekers, price-sensitive spa-goers and high spenders. Research limitations/implications – Given the limited academic interest in the area, this study contributes to the literature by providing insights into spa-goers’ preferences and how those preferences can be used to segment spa-goers. Practical implications – Based on the different needs, preferences and socio-demographic characteristics of the four segments – spa enthusiasts, high spenders, value seekers and price-sensitive spa-goers – spa industry managers could customize their strategies and design different spa services and packages to meet the needs of the four segments. Originality/value – The combined use of conjoint and cluster analysis provides a new method of market segmentation in the spa industry. This study could help spa professionals to design customized spa products for the distinct segments, and thus retain and attract more spa visitors.