Optimal targeting of latent tourism demand segments
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Date
2023
Journal Title
Journal ISSN
Volume Title
Publisher
Elservier
Abstract
This paper identifies for the first time the optimal target markets employing the latent tourism demand
expenditure, a novel concept in tourism literature. The study quantifies latent tourism demand between each pair
of origin-destination through distinguishing by type of tourism and seasonality. It works with market shares that
are estimated via a fractional regression model. Moreover, latent demand is clustered using a market segmen
tation approach based on a latent class regression. Finally, the optimal target markets are chosen depending on
the expected latent tourism expenditure. The result has clear policy implications in terms of which markets are
promoted, the optimal channels of communication and the maximum budget for each marketing campaign.
Description
Keywords
Latent demand; Target markets; Marketing campaign; Market segmentation; Tourism expenditure