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Affinity Group Marketing in Tourism

Approaches to Identification and Evaluation

Paper for the PhD workshop held on January 28th, 2003 in Helsinki / Finnland

Guido Sommer

University of Trier, Germany

[email protected]

1. Problem definition

Over the past years there has been a development from anonymous mass marketing to a

more differentiated and personalized target group marketing. This development could be

observed in most sectors, with the financial sector playing a leading role. The tourism

industry lagged behind but seems to pick up speed in catching up with the implementation of

specific customer databases.

Affinity Group Marketing is not a new topic but increasingly more relevant for tourism. In

tourism mass marketing is more and more characterized as addressing a rather boring group,

particularly without segmentation and strategically very difficult to access and therefore very

expensive.

The trend perception becomes more and more important. The way customers and potential

customers live, their specific behaviour within a group, their consumption etc. that is which

Affinity Group they belong to - becomes more and more interesting.

2. Definitions

Affinity Groups are defined as "a group of people who share a common interest, background

or goal" (Koschnik 1997).

Affinity Group Marketing is seen as a group-related marketing that attempts to improvenarrow personal relationships of target persons within social groups. It attempts to overcome

perception barriers due to information overload and increasing similarity of products and is

seen as a specific promotion technique (Macchiette/Roy 1992).

Affinity Group Marketing differs therefore from the common target group marketing. Meffert

sees three components of Affinity Group Marketing:

1. "third-party-endorsement": the support by a third party. An advertisement is

communicated through a chosen person so that it becomes more plausible.

2. "shared incentives": product-independent, physical or immaterial services for the

benefit of a group.

3. "enhancement package": monetary advantages for the addressed group members.(Meffert 1994)


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3. Identifying Affinity Groups

To be able to benefit from Affinity Group Marketing, first of all possible groups have to be

identified. Koschnik developed a cluster modell that offers the possibility to search for

different Affinity groups. The model consists of five clusters into which groups can be

segmented: Professional based, Value centered, Socially based, Demographic based,Marketing generated. (Koschnik 1997)

In the following the clusters will be described and examples will be given:

Professional based:Affinity Groups that are based on professional associations and

seniority or the corporate identity of companies. Syndicates can be placed into this

cluster.

Value centered:Affinity Groups that pursue a central idea and central values like for

instance Greenpeace or Amnesty International. Usually value centered Affinity

Groups are engaged either politically or religiously.

Socially based: Affinity Groups which can be put together due to social interests,

leisure activities or events. These interests can be:o product centered: old-timer clubs, Harley Davidson club

o customer driven: Tupperware, Avon

o celebrity centered: Elvis Credit Card Program

o activity interest: Bridge club, stamp collector, every type of sports club

Demographic based: The following features can be of importance: Education,

geographic factors or ethnic origin. An Affinity group could be the graduates of a

certain subject.

Marketing generated: Affinity Groups, that have arisen due to marketing actions. A

cluster, that rather stands next to the other ones since every group of this cluster could

be assigned also to another. An example would be the members of a Porsche club.

An Affinity Group that has been clustered according to the model still gives no implications

whether it makes sense from an economic point of view to concentrate marketing activities

onto it. To make such a decision other factors have to be taken into account

4. Evaluating Affinity Groups

Meffert sees two dimensions that play a key role in evaluating Affinity groups: "Affinity

intensity" and "public confession".Affinity intensity reflects the active or passive cooperation of the members within the group.

The public confession on the other hand illustrates how many members confess their

belonging to the specific group in public. (Meffert 1994)

For a better understanding of the two dimensions more criteria shall be given:

Affinity intensity can be measured by

the amount of time that one spends for the Affinity Group / surpassing interest

the active use of specific media

receiving news letters / SMS-services

membership of an association / club

Public confession:

The confession can be expressed through:


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clothing

the visit of specific fairs

reading specific magazines

buying specific products

a determined life-style (expresses the influence of the Affinity Group)

the existance of events/meeting places the existance of awards/rankings/contests

active advertising of products from an industry

Affinity Groups can be placed in a portfolio to visualize their position considering the two

dimensions.

intensity

public

confession

high

low

activelittle

1.

2. 3.

4.

intensity

public

confession

high

low

activelittle

1.

2. 3.

4.

fig. 1 Affinity group portfolio intensity vs. public confession

source: own preparation following: Schertler 2002.

For the tourism industry other factors such as the touristic predestination play a major role.

How high is the touristic potential of the Affinity Group golf compared to wine

connoisseurs or hunters?

Another important dimension should be the organization degree". It is important for a

provider to know whether he addresses a general or an organized market.

Again more criteria shall be given to explain the two dimensions:

Organization degree: The existance of

associations / clubs / professional groups and lobbies

journals specific newsletters

tour operators

different products

franchise systems

incentives / customer cards

touristic predestination (for a specific destination)

The group has a specific affinity for the destinations offers

The availability of a specific infrastructure as fundamental condition

The capacity of the destination

Increased demand from the destination

There are fairs or meeting places

The relation between overseas and domestic travel. Do tourists cross borders?


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Sufficient time for touristic trip (for example: only two weeks annual leave in the US)

Travel form: group or individual travel

Education

Age structure

Income structure

The two dimensions could also be shown in a portfolio grid similar to fig. 1.

Other dimensions of great interest are the size of the market. A supplier of touristic services

will never invest into a market that lies under a certain critical size.

Another crucial factor is the specificity of the destinations infrastructure. Golf players need

golf courses whereas stamp collectors dont need any specific infrastructure. Affinity Groups

are not attractive for a destination when an expensive infrastructure has to be established

especially in order to fit the needs of the group.

The relevant criteria is the following:

Size of the market: Size

absolute size versus

the relevant size (attainable market for the destination)

Number of copies of specific literature

Number of hits on specific websites

Number of spectators for specific TV shows / listener of specific radio programs

Number of association members

Turnover volume of specific products

Number of companies. Is there a sector behind them?

Specificity of the destinations infrastructure:

How much specific infrastructure is necessary? Is additional corporate spending

necessary?

Infrastructure as:

Hotel business

affinity related infrastructure (cycling tracks, vineries etc.)

affinity related services (opening hours, guided tours, English

information material, trip and baggage transfers, shipping services,

possibilities for renting etc.)

Adaptation to the destinations needs

5. Proceedings

The next step will be the creation of an investment portfolio, where market attractiveness and

the relative competition will be the two crucial dimensions.

After knowing what the relevant Affinity Groups are, specific products will have to be

developed and a specific communication policy and sales strategy will have to be established.

This may require specific pricing models.


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6. References

Macchiette, Bart; Roy Abhijit:Affinity-Marketing: What is it and how does it work?,

in: The journal of services marketing, Vol. 6, Nr. 3, 1992, S. 47 57.

Meffert, Heribert: Lexikon der aktuellen Marketing Begriffe, 1st edition, Vienna

1994.

Koschnik, Wolfgang J.:Lexikon Marketing A-L, 2nd extended edition, Stuttgart 1997.

Schertler, Walter:Lecture script, Trier 2002.

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