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Benefit Segmentation of International Travelers to Macau, ChinaWoo Gon Kima; Yumi Parkb; Gabriel Gazzolic; Edmund Shengd

a Robert H. Dedman Professor of Hospitality Management & Director of International Center forHospitality Research, Dedman School of Hospitality, College of Business, Florida State University,Tallahassee, Florida, USA b Oklahoma State University, School of Hotel and RestaurantAdministration, Stillwater, Oklahoma, USA c Aston Business School, Aston University, Birmingham,United Kingdom d Institute For Tourism Studies, Colina de Mong-Ha, Macao

Online publication date: 06 February 2011

To cite this Article Kim, Woo Gon , Park, Yumi , Gazzoli, Gabriel and Sheng, Edmund(2011) 'Benefit Segmentation ofInternational Travelers to Macau, China', Journal of Quality Assurance in Hospitality & Tourism, 12: 1, 28 — 57To link to this Article: DOI: 10.1080/1528008X.2011.541813URL: http://dx.doi.org/10.1080/1528008X.2011.541813

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Journal of Quality Assurance in Hospitality & Tourism, 12:28–57, 2011Copyright © Taylor & Francis Group, LLCISSN: 1528-008X print/1528-0098 onlineDOI: 10.1080/1528008X.2011.541813

Benefit Segmentation of InternationalTravelers to Macau, China

WOO GON KIMRobert H. Dedman Professor of Hospitality Management & Director of InternationalCenter for Hospitality Research, Dedman School of Hospitality, College of Business,

Florida State University, Tallahassee, Florida, USA

YUMI PARKOklahoma State University, School of Hotel and Restaurant Administration,

Stillwater, Oklahoma, USA

GABRIEL GAZZOLIAston Business School, Aston University, Birmingham, United Kingdom

EDMUND SHENGInstitute For Tourism Studies, Colina de Mong-Ha, Macao

The purpose of this study is threefold: (1) to identify the underlyingbenefits sought by international visitors to Macau, China, whichhas emerged as a popular gambling destination in Asia; (2) tosegment tourists visiting Macau by employing a cluster analysisbased on the benefits sought; and (3) to examine any salient differ-ences between the segment groups with regard to their behavioralcharacteristics, socio-economic characteristics, and demographicprofiles. A convenience sample was used to collect data in theMacau International Airport, in the Macau Ferry Terminal, andat the border gate with Mainland China. A total 1,513 usefulsurveys were retained for data analysis. Cluster analysis dis-closes four distinct clusters: “convention and business seekers,”“family and vacation seekers,” “gambling and shopping seekers,”and “multi-purpose seekers.” Based on the results of our findings,several managerial implications are discussed.

KEYWORDS benefit segmentation, cluster analysis, Macau, desti-nation management

Address correspondence to Woo Gon Kim, Ph.D., 288 Champions Way, UCB 4116, POBox 3062541, Tallahassee, FL 32306-2541. E-mail: wkim@cob.fsu.edu

28

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International Travelers to Macau, China 29

INTRODUCTION

The travel and tourism industry has become an essential factor in the devel-opment of many cities, regions, and countries (Weber & Telišman-Košuta,1991). According to a study conducted by the World Travel and TourismCouncil (2008), the total expected tourism demand reached $7.8 trillion ineconomic activities worldwide in 2008, and this number is forecasted toincrease to $14.8 trillion in 2018. The same study reported that the tourismsector is expected to contribute 9.9 % of the global gross domestic product(GDP) in 2008, as well as employ more than 238 million people directlyand indirectly (Weber & Telišman-Košuta, 1991). In light of such astonish-ing statistics, the tourism industry is widely recognized as a major economicand social contributor to many destinations, and therefore, a focus on thisindustry’s growth has become an important component in the developmentstrategy of any destination.

As the tourism industry develops in new areas of the world, destina-tion choices for consumers continue to expand. As a result, travelers havemore choices when making travel decisions, and these destinations, there-fore, must compete more than ever for tourist dollars. Consequently, tourismmarketers are faced with more complex and competitive marketplaces. Inorder to develop a competitive advantage and improve returns from market-ing investments, destinations must develop appropriate market segmentationstrategies. Following a basic principle of marketing strategy proposed byKotler (1967), destinations should segment their markets in order to identifytheir most attractive customers. The importance of segmentation is so crucialfor an effective strategy that some scholars have suggested that “if you’re notthinking segments, then you’re not thinking” (Levitt, 1983).

One criterion for destination market segmentation is to analyze thebenefits sought by tourists (Sarigollu & Huang, 2005). Kotler and Turner(1993) suggested that benefit segmentation is a powerful tool for puttingconsumers into more homogeneous groups. In addition, Haley (1968) pro-posed that benefit segmentation provides more accurate determinants ofhuman behavior than other approaches because the benefits that touristsseek are the basic reasons for the existence of true market segments.

The purpose of this study, then, is to examine the benefits sought bytourists at a particular destination, one which has gained popularity as agaming paradise and an emerging tourist destination in Asia: Macau, China.

Research Site

Macau is located on the South coast of China. Its territory is within a 60 kmreach of Hong Kong and 145 km from the city of Guangzhou (on MainlandChina). In the early 1500s, Macau was colonized by Portugal. The Portugueserule lasted until December 1999, when Macau was handed over to China.Today, Macau is a Special Administrative Region (SAR) of China, and, like

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30 W. G. Kim et al.

TABLE 1 Macau Economic and Tourism Indicators (2000–2008)

Indicator 2000 2001 2002 2003 2004 2005 2006 2007 2008

Unemployment rate (%) 6.75 6.39 6.23 6.02 4.75 4.1 3.72 3.04 3.02Nominal GDP (USD

billion)6.1 6.2 6.9 8.0 10.3 11.5 14.2 18.8 21.7

GDP per capta (USD000s)

14253 14348 15671 17898 22554 24263 28536 35786 39577

Visitor arrival (million) n.a n.a 11.5 11.8 16.6 18.7 22 27 22.9Gross gaming revenue

(USD billion)n.a n.a n.a n.a n.a 5.9 7.2 10.5 13.8

Rooms available (fromguest houses to 5∗)

9,201 9,030 8,954 9,188 9,168 10,832 12,982 16,148 17,490

Hotel occupancy (%) 57.5 67.1 73.8 77.4 78.5 76.1 78.1 83.0 79.0Number of MICE events n.a n.a 136 125 278 305 360 1,117 1,240

Note: GDP = Gross Domestic ProductUSD1 = MOP 7.98 as of December 12, 2009.Source: Statistics and Cesus Services, Macao SAR Government

Hong Kong, it benefits from the principle of one country and two sys-tems (Macau Government Tourist Office, 2008). The resident population ofMacau has increased from 425,200 in 1998 to 541,200 in the third quarter of2009 (Macau Statistics and Census Services, 2009a). Macau has experienceda phenomenal growth in tourist arrivals in the past decade. In 1998, theregion registered 6.9 million arrivals and the numbers grew annually until2007, when Macau achieved a record high number of 27 million arrivals.However, in 2008, the region registered a decrease in the number of touristarrivals, totaling 22.9 million visitors. Tourists from Mainland China repre-sented 50% of the total arrivals in 2008, while 30% were from Hong Kong, 6%from Taiwan, and all other countries represented the remaining 14% (MacauStatistics and Census Services, 2009b). The contribution of Travel & Tourismto the Gross Domestic Product (GDP) of Macau is expected to changefrom 69.9% (USD 19.3 billion) in 2009 to 70.7% (USD 45.3 billion) in 2019(World Travel & Tourism Council, 2009). Macau’s tourism industry currentlyemploys 177,000 people, representing 65.3% of the region’s total employ-ment. According to the World Travel & Tourism Council’s (2009) worldranking, Macau’s tourism is listed as the 39th place in absolute size, thirdin contribution to national economy, and 35th in growth forecast among 181other countries. Table 1 presents the major economic and tourism indicatorsof Macau, and it shows how this destination evolved over the years from2000 to 2008.

LITERATURE REVIEW

The Need for Segmentation Research

Scholars in the field of consumer behavior focus their efforts on explainingthe decision-making processes of different consumers, and the foundation

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International Travelers to Macau, China 31

theories used in their research are generally embedded and linked tomicroeconomics and psychology (Voorhees, 2006). Although consumers’decision-making process is an exclusive process, theories used to justifythese processes rely on the idea that consumer markets are heterogeneous.This heterogeneity can be explained by the argument that consumers havedifferent and individual characteristics that are related to diverging eco-nomic motivations and personal decision-making criteria (Voorhees, 2006).Psychological theories that explain consumer behavior focus on key differ-ences of need fulfillment whereas economic-based explanations tend to relyon the theory of imperfect competition (Robinson, 1938). Both psychologicaland economic theories provide support for the argument that market seg-mentation is a critical process that is needed in order to develop a productand a service and, in the case of this paper, to select a tourist destination.The economic and psychological theories used in market segmentation areexplained in detailed below.

The imperfect competition theory proposed by Robinson (1938) sug-gests that markets become heterogeneous due to the fact that consumershave different needs and unique preferences (Robinson, 1938; Smith, 1956).It also suggests that discrepancies in customers’ preferences for, and per-ceptions of, products may lead to drastic shifts in the demand curve(Chamberlin, 1965), and if service providers for a particular tourist des-tination do not adapt to and embrace these consumer preferences, thenmarket friction occurs. However, demand curves could be shifted to theright and force markets to become less price elastic if markets are segmentedproperly (Chamberlin, 1965; Dickson & Ginter, 1987), and this process aidsmarketers in transforming heterogeneous markets into smaller homogenoustargets.

Psychologists also suggest that consumers posses unique needs andobjectives when purchasing a product, and therefore, they may take ondifferent approaches to fulfill their needs and wants (Voorhees, 2006). Forexample, Maslow (1943) suggested that consumers’ needs are on a con-tinuum process, whereas their motivations for purchases are presented indifferent levels, depending on the needs and goals that the consumers aretrying to accomplish. In addition, the consumers’ personal values play a keyrole in the attainment of the needs that they seek, and these values mayaffect the benefits that consumers are looking for when making their buyingdecisions (Maslow, 1943). For example, travelers who value entertainment,night life, and social approval may be driven to visit “hot-spot” destinations,such as Miami and Ibiza. Similarly, travelers who are price conscious or whovalue educational culture may make travel arrangements according to thesevalues and goals, such as? Therefore, some of the reasons behind the het-erogeneity of consumer markets are affected by the benefits that consumersseek when making purchases (Haley, 1968).

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32 W. G. Kim et al.

Market Segmentation Research in the Tourism Industry

As discussed earlier, market segmentation helps marketers break down het-erogeneous markets and define smaller segments of homogeneous groupsaccording to one or several variables. In the tourism field, the criteriaused for segmentation can be divided into two different groups: 1) gen-eral consumer characteristics that include psychographic, geographic, anddemographic variables; and 2) situation-specific characteristics, such asthe consumers’ perceptions, preferences, and attitudes toward products orservices; the modes of product usage and the benefits sought; and thepurchasing frequency and actual expenditure (Legoherel, 1998).

The literature shows that benefits have been defined and conceptual-ized differently by several scholars (Sarigollu & Huang, 2005). On one side,researchers have defined benefits as visitor ratings of amenities and activities(Tian, Crompton & Witt, 1996). This definition has been used in destinationimage research where the objective was to measure visitors’ impressions ofdestinations (Crompton, 1979). On the other side, in order to capture thetourists’ psychological benefit outcomes, researchers have focused on themotivations to travel (Bieger & Laesser, 2002). The present study adopts abroader view of benefit segmentation as it incorporates the desired activitiesand motivations that international travelers seek when considering Macauas a travel destination.

Besides different definitions and conceptualizations of benefit segmen-tation, the literature shows that this segmentation strategy can be classified aseither destination-specific or non-destination-specific. In destination-specificresearch, tourists to a common destination are classified into segments basedon the benefits they seek (desired activities or motivations). For example,Kim and Agrusa (2009) interviewed Japanese visitors in Honolulu, Hawai,and defined five groups on the basis of the tour-purpose segmentationmethod, namely: 1) Honeymoon tourism; 2) Fraternal association tourism; 3)Sports tourism; 4) Tourism for rest and relaxation; and 5) Business/VFRtourism. In addition, Li, Huang, and Cai (2009) collected data from adult vis-itors to a rural community in the state of Indiana, USA, and found 6 factors(out of 32 motivation variables), including escape; novelty; nostalgia andpatriotism; event excitement; family togetherness; and socialization.

Non-destination studies, on the other hand, explain the general char-acteristics (benefits) that tourists seek when planning to visit a destination.The data for this type of study are usually collected from specific regions(Sarigollu & Huang, 2005). Past non-destination-specific research includesBieger and Laesser (2002), who studied the general motivations of Swisstravelers in Switzerland and found motives such as nightlife, nature, culture,sports, and sun. Further, Shoemaker (1994), who segmented the US travelmarket by benefits, adopted 39 different variables including sun, sports,entertainment, family, convenience, and scenery. Finally, Cha, McCleary, and

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International Travelers to Macau, China 33

Uysal (1995) explored the travel motivation of Japanese overseas tourists andfound six motivational dimensions (e.g., relaxation, knowledge, adventure,travel bragging, family, and sports) out of a total of 30 motive variables.According to the literature, the majority of published work within thisdomain is destination-specific (e.g., Andreu, Kozak, Avei, & Cifter, 2005;Davis & Sternquist, 1987; Frochot, 2005; Huang & Sarigöllü, 2007; Johns &Gyimóthy, 2002; Lang & O’Leary, 1997; Loker & Perdue, 1992; May, Bastian,Taylor, & Whipple, 2001; Moscardo, Pearce, Morrison, Green, & O’Leary,2000; Sarigöllü & Huang, 2005; Tian et al., 1996; Woodside & Jacobs, 1985).

Past research also shows an array of statistical techniques used in seg-mentation studies. Most of the studies have applied cluster analysis, as thistechnique has proven to be an effective marketing strategy tool becauseit yields viable market segments (Arimond & Elfessi, 2001). Besides clusteranalyses, other statistical techniques were added to complement the initialcluster investigation. For example, May et al. (2001) used canonical discrimi-nant analysis to further analyze the differences between the clusters. Boo andJones (2009) applied discriminant analysis, and Bieger and Laesser (2002),as well as Sirakaya, Uysal, and Yoshioka (2003), used multiple discriminantanalysis (MDA) to further identify discriminating factors for each cluster.Kim and Agrusa (2009) added analysis of variance (ANOVA) and correspon-dence analysis to assess the differences in the travelers’ preferences andother travel-related, attitudinal, behavioral, and socio-demographic charac-teristics related to each tour purpose. Table 2 provides an overview of extantresearch on benefit segmentation within the tourism field.

Tourism Research on Macau

The literature shows several recent studies related to tourism developmentin Macau. For example, Gu (2006) highlighted the importance for Macauto focus on product differentiation through a revenue management strategyas a mean to compete effectively against the emerging gaming destinationin nearby Asian countries. According to Gu, Macau should concentrate itsefforts on differentiated gaming service products, such as its VIP roomsoperations, in order to maximize the future revenue potential.

Along the same line of thinking, Gu (2004) conducted a SWOT analysisof Macau before answering the question as to whether or not the destinationshould follow the Las Vegas style when developing its own gaming strategy.The author concluded that the Las Vegas business model is not a suitableapproach for Macau, as it will force Macau to compete against Las Vegas andother Las Vegas-type destinations in Asia. Moreover, the study suggestedthat if Macau follows the Las Vegas colossal “gaming, entertainment, con-vention, and shopping” model, it would also compete against non-gamingdestinations, such as Hong Kong and other nearby Chinese cities. Therefore,

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TAB

LE2

Sum

mar

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Segm

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Auth

ors

(Yea

r)Su

bje

ctan

dst

udy

regi

on

Ben

efits

sough

tdim

ensi

ons

(fac

tors

)Se

gmen

tsD

iffe

rentse

gmen

tatio

ncr

iteria

(Del

inea

tors

)

Boo

&Jo

nes

(200

9)Tra

vele

rsto

the

maj

or

met

ropolit

anar

eaw

ho

visi

ted

tourism

-rel

ated

site

s

6fa

ctors

(outofa

tota

l20

item

s)—

Soci

al/In

tera

ctio

n;

Exc

item

ent/

Fun;Rel

axat

ion;

Sigh

tsee

ing;

Fam

ily/Fr

iends

Toge

ther

nes

s;an

dSp

orts

3Clu

ster

s—So

cial

-see

king

trav

eler

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item

ent-se

ekin

gtrav

eler

s;an

dRel

axat

ion-s

eeki

ng

trav

eler

s

None/

Dis

crim

inan

tan

alys

isofea

chgr

oup

Kim

&A

grusa

(200

9)Ja

pan

ese

tourist

sto

Honolu

lu,H

awai

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SA5

groups

on

the

bas

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ur

purp

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moon

tourism

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tourism

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rest

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rela

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usi

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(outofa

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ben

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)—Esc

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m;

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her

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the

Car

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fact

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each

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dPar

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Arts

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Seek

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s,Tra

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dPer

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34

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Andre

u,K

oza

k,Avc

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005)

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ns)

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nm

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anto

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ature

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35

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TAB

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ctan

dst

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and

sun.

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puls

ory

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m;

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ilyTra

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tM

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ting

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san

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mea

ns

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sportat

ion,

round

trip

dis

tance

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sitet

c./

Dis

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y(2

002)

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itors

toB

orn

holm

,D

enm

ark

4fa

ctors

(outofa

tota

lof19

activ

ities

)—O

utd

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al;

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nat

ure

;Rel

axin

g;an

dSi

ghts

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g

2Clu

ster

s-A

ctiv

ean

dIn

activ

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oup

Am

eniti

es,A

ctiv

ities

,A

ttra

ctio

nvi

sit

May

,B

astia

n,Tay

lor,

&W

hip

ple

(200

1)W

yom

ing

snow

mobile

ow

ner

s,W

yom

ing,

U.S

.26

ben

efits

incl

udin

gen

joyi

ng

nat

ure

,ac

hie

vem

ent,

stim

ula

tion,es

cape,

per

sonal

/so

cial

pre

ssure

,an

dbei

ng

with

fam

ilyan

dfr

iends

5Clu

ster

s—A

chie

vem

ent/

stim

ula

tion;

Esc

ape

per

sonal

/so

cial

;Enjo

ynat

ure

/le

arnin

g;B

eing

with

sim

ilar

fam

ilyan

dfr

iends;

and

Esc

ape

Phys

ical

Pre

ssure

Soci

o-e

conom

icch

arac

terist

ics

and

Beh

avio

r(e

.g.,

num

ber

ofday

ssn

ow

mobili

ng

per

year

,am

ountof

spen

ton

last

trip

,et

c.)/

Can

onic

alD

icsr

imin

antan

alys

isofea

chgr

oup

36

Downloaded By: [Oklahoma State University] At: 12:26 7 February 2011

Mosc

ardo,Pea

rce,

Morr

ison,G

reen

,&

O’L

eary

(200

0)

Vis

itors

toQ

uee

nsl

and,

Aust

ralia

.(f

rom

ase

condar

ydat

afr

om

the

Quee

nsl

and

Tourist

and

Tra

velCorp

ora

tion)

20ben

efits

incl

udin

gre

laxa

tion,re

sort,w

arm

sunny

wea

ther

,bea

chac

tiviti

es,an

den

viro

nm

enta

lac

tiviti

es

4Clu

ster

s—B

each

Rel

axat

ion

group;In

activ

egr

oup;

Act

ive

Nat

ure

Love

rsgr

oup;

and

Act

ive

Bea

chRes

ort

group.

Dem

ogr

aphic

san

dTra

vel

beh

avio

r(e

.g.,

trav

elpar

ty,ex

pen

ditu

re,

lengt

hofst

ay,m

eans

oftran

sportat

ion,et

c.)

Form

ica

&U

ysal

(199

8)Vis

itors

toth

eSp

ole

toFe

stiv

alin

Ital

y6

fact

ors

(outofa

tota

lof23

motiv

es)—

Soci

aliz

ing;

Cultu

ral/

his

torica

lsi

gnifi

cance

;G

roup

toge

ther

nes

s;Si

tenove

lty;

Eve

ntat

trac

tion

&ex

cite

men

t;an

dFa

mily

Toge

ther

nes

s

2Clu

ster

—Enth

usi

asts

and

Moder

ates

group

Dem

ogr

aphic

san

dTra

vel

beh

avio

r(e

.g.,

repea

tor

firs

t-tim

evi

sito

r)

Lang

&O

’Lea

ry,

1997

Aust

ralia

nnat

ure

trav

eler

sto

outs

ide

ofA

ust

ralia

and

New

Zea

land

(outb

ound

nat

ure

trav

elm

arke

t)

7ben

efitfa

ctors

(outofa

tota

lof25

ben

efits

)—N

ewExp

erie

nce

;Esc

ape

and

Ente

rtai

ned

;Sh

ow

and

tell;

Fam

ilyO

rien

ted;Cultu

ral

Gro

ups

Inte

rest

;Phys

ical

Chal

lenge

and

Nat

ure

;an

dRel

ax

6Clu

ster

s—Phys

ical

Chal

lenge

Seek

ers;

Fam

ilyVac

atio

ner

s;Cultu

rean

dEnte

rtai

nm

ent

Seek

ers;

Nat

ure

Tourist

s;Esc

ape

and

Rel

axVac

atio

ner

s;an

dIn

diffe

rent

Tra

vele

rs

‘Motiv

atio

n-p

artic

ipat

ion-

pre

fere

nce

’multi

-se

gmen

tatio

nap

pro

ach

Tia

n,Cro

mpto

n,&

Witt

(199

6)M

use

um

goer

sin

Gal

vest

on,

Texa

s18

ben

efits

incl

udin

gre

laxa

tion,en

tertai

nm

ent,

soci

aliz

ing,

bondin

g,so

cial

reco

gniti

on,se

lfes

teem

,an

ded

uca

tion

4cl

ust

ers

Dem

ogr

aphic

san

dTra

vel

beh

avio

r(e

.g.,

freq

uen

cyoftrav

el,

type

ofm

use

um

svi

site

d,et

c.)

Cha,

McC

lear

y,&

Uys

al(1

995)

Japan

ese

ove

rsea

sto

urist

s6

fact

ors

(e.g

.re

laxa

tion,

know

ledge

,fa

mily

,an

dsp

orts)

outofa

tota

lof30

motiv

eva

riab

les

3Clu

ster

s-Sp

orts

seek

ers;

Nove

ltyse

eker

s;an

dFa

mily

/re

laxa

tion

seek

ers

Dem

ogr

aphic

s (Con

tin

ued

)

37

Downloaded By: [Oklahoma State University] At: 12:26 7 February 2011

TAB

LE2

(Contin

ued

)

Auth

ors

(Yea

r)Su

bje

ctan

dst

udy

regi

on

Ben

efits

sough

tdim

ensi

ons

(fac

tors

)Se

gmen

tsD

iffe

rentse

gmen

tatio

ncr

iteria

(Del

inea

tors

)

Shoem

aker

(199

4)U

Strav

elm

arke

t39

diffe

rentva

riab

les

incl

udin

ged

uca

tional

poss

ibili

ties,

envi

ronm

enta

las

pec

ts,

reso

rtse

t,su

nsp

orts,

popula

rity

ofdes

tinat

ion,

valu

e,sc

ener

y,fr

iend,

rela

tives

,en

tertai

nm

ent,

fam

ily,an

dco

nve

nie

nce

Dem

ogr

aphic

san

dTra

vel

beh

avio

r(e

.g.,

num

ber

oftrip

sper

year

,pla

ns

for

futu

retrip

etc.

)

Loke

r&

Per

due

(199

2)N

orth

Car

olin

a12

ben

efits

incl

udin

ges

cape,

rela

xatio

n,nat

ura

lsu

rroundin

gs,ex

cite

men

tva

riet

y,fa

mily

,an

dfr

iends

6Clu

ster

s

Dav

is&

Ster

nquis

t(1

987)

Tra

vers

eci

ty,U

.S.

10ben

efits

incl

udin

gsp

orts,

sigh

tsee

ing,

rest

,sh

oppin

g,fo

od,en

tertai

nm

ent,

and

cultu

re

Dem

ogr

aphic

san

dTra

vel

beh

avio

r(e

.g.,

des

tinat

ion,to

talsi

zeof

trav

elgr

oup,le

ngt

hof

visi

tet

c.)

38

Downloaded By: [Oklahoma State University] At: 12:26 7 February 2011

International Travelers to Macau, China 39

creating its own model and focusing on the niche gaming segment wouldhelp Macau differentiate itself from similar Las Vegas-type destinations (Gu,2004). Further, Nadkarni and Leong (2007) indicated that the developmentof MICE (Meeting, Incentive, Convention, and Exhibition) facilities, cou-pled with other leisure and entertainment factors, will create a competitiveadvantage for Macau over its regional competitors, and it will yield higher-spending business tourists. Lastly, many other researchers argued that Macaucan be re-created as the Las Vegas of Asia (McCartney 2003; McCartney &Nadkarni, 2003; Tang, Choi, Morrison, & Lehto, 2009). This vision has beenembraced by the Macau Government and some casino operators, such asLas Vegas Sands, who opened The Venetian in 2007: an integrated gamingand MICE resort (McCartney, 2008a).

Several studies related to Macau as a destination have centered theirresearch questions towards Macau’s image. The literature shows tworesearch streams within its destination image. The first stream focused onMacau’s projected online images from different websites (e.g., Choi, Lehto,& Morrisson, 2007; Tang et al., 2009). Choi et al. (2007) attempted to iden-tify the image attributes of Macau on the internet by examining 61 websitesdivided into five different categories, namely 1) Macau official tourism web-site (MGTO), 2) travel guides, 3) travel magazines, 4) travel blogs, and 5)travel trade. The results from the content and correspondence analysisshowed that Macau has many faces, and its projected image varied accordingto the different online information sources. For example, the word “casino”was the fourth and fifth most frequent word in travel magazines and blogs,respectively, and 47th on the MGTO website, whereas the word “museum”was the second most frequent word on the MGTO website, sixth on traveltrade sites, 25th on the blogs, and 57th in magazines. These findings suggestthat the MGTO website is trying to move away from a “gaming” image byfocusing its communication efforts on a more diverse set of activities, such asculture/sightseeing, shopping, and other leisure activities (Choi et al., 2007;Tang et al., 2009).

On the other hand, the second research stream has tried to capturethe image perceptions from actual and potential visitors to Macau (e.g.,McCartney, 2005; McCartney, 2008b; McCartney, Bluter, & Bennett, 2008).McCartney (2005) studied the impact of the 50th Macau Grand Prix eventon visitors’ destination image perceptions. His findings showed that theGrand Prix itself did not change the image perceptions of tourists, and thattourists sometimes have a negative perception of Macau as being exclusivelya gaming destination. McCartney (2008b) compared data from travelers rep-resenting the four major tourist markets in Macau—Hong Kong, Beijing,Taiwan, and Shanghai—and found significant differences between the mar-kets in all 33 measured image attributes. Overall, the attributes “gamblingopportunities,” “good night-life/adult oriented,” and “restful and relaxing”showed the highest mean ratings across all regions. Weaker perceptions

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40 W. G. Kim et al.

across the respondent groups were related to attributes such as “place todo business,” “place to have meeting/exhibition,” “rich cultural heritage,”and “important museums.” The same study also examined the differencesin travel motives between the four regions, and the results showed thatsignificant differences exist between Macau’s major travel markets. In gen-eral, the highest motives for travel were “relax physically and mentally” and“experience a new culture,” whereas “visit friends and relatives” and “ableto gamble legally” were the weakest motives, respectively.

In sum, our literature review shows that Macau’s image remains some-what perceived as solely a gaming place (McCartney, 2008a), despitegovernmental efforts to reposition this destination as a place where one canenjoy different activities, such as MICE, culture, and entertainment. Sincelearning what drives tourists’ activities and motivations becomes crucial foran effective destination positioning (McCartney et al., 2008), this study seeksto answer the following three research questions:

1. What are the underlying benefit factors sought by Macau visitors?2. How best? to segment tourists who visit Macau by employing cluster anal-

ysis, based on their specific activities and the benefits they seek duringtheir stay in Macau?

3. What are the salient differences between the different segments ofvisitors with regard to their behavioral characteristics, socio-economiccharacteristics, and demographic profiles?

METHODOLOGY

This study conducts a benefits market segmentation analysis of internationaltourists visiting Macau. The benefit factors are generated through the desiredactivities and motivations of tourists when they consider Macau as a traveldestination. The information required to perform this research was obtainedby questionnaire.

Questionnaire Development and Data Collection

The questionnaire was developed to collect a wide rage of informationfrom international tourists to Macau and was comprised of two major parts.The first part of the questionnaire assessed behavioral, socio-economic, anddemographic variables, such as party size and composition, purpose of trip,length of stay, entry mode, country of origin, age, household income, accom-modation type, package users vs. non-package users, and occupation andeducational levels. The second part of the questionnaire was composed of25 items, representing the activity attributes that international visitors per-ceive as most important when considering Macau as a travel destination.

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International Travelers to Macau, China 41

The activity variables were measured on a 7-point Likert-type scale (from1 = strongly disagree to 7 = strongly agree) and selected after an extantliterature review in academic journals, interviews with Macau residents, andconsultation with tourism scholars from that region.

Due to the large number of visitors coming from Mainland China andHong Kong, the English questionnaire was also translated into traditionaland simplified Chinese by an employee from a local university. It was thenpresented to staff members and students of the same university, as wellas employees of a local hotel, for verification purposes. After verifying thetranslations, the three versions of the questionnaire were pre-tested on 18different students for validity purposes.

Nine paid students from the university were hired to support the datacollection phase. These students attended a 2-hour training session givenby one of the researchers, who was also on-site. The field researchers wereinstructed to perform the following three steps: 1) to approach internationaltravelers; 2) to introduce the purpose of the study; and 3) to request theirparticipation in the survey. The data was collected during July and August2007, and a convenience sample method with a self-administered ques-tionnaire was applied. The locations used for data collection were in theMacau International Airport, on the Macau Ferry Terminal, and at the bordergate with Mainland China. In total, the researchers gathered 1,812 question-naires, but due to a substantial amount of missing information in many ofthe questionnaires, 1,513 useful surveys were retained for data analysis.

RESULTS

Factor Analysis and Reliability Test of Macau Visitors’ Activities

Factor analysis was used to identify the underlying constructs of the 25 activ-ities performed by visitors to Macau. Three items were deleted after factoranalysis, and two more were eliminated after a reliability test, resulting in 20items (of the original 25) used in the survey. A Principal Component Analysis(PCA) with a Varimax rotation was used with a pre-determined cut-off eigen-value equal to or greater than 1.0 (Heung & Cheng, 2000). Only factors withmore than .4 loading were retained and included in the factor identifica-tion. The Cronbach’s alpha coefficient of each factor ranged from .63 to .92,which was considered acceptable. In relation to the reliability of the scale,the Kaiser-Meyer-Olkin measure of sampling adequacy (KMO = 0.805) wasquite high, and Bartlett’s test of sphericity was significant (Approx. χ 2 =13198.473, df = 210, p < .001). As a result, the factor model was consideredsatisfactory.

The six factors having eigenvalues greater than 1.0, which explained64.6% of the total variance, were identified and named as follows: “gam-bling,” “convention and business,” “pleasure,” “cultural exploration,” “family

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42 W. G. Kim et al.

togetherness,” and “shopping” (see Table 1). The first dimension, labeled“gambling,” accounted for 22.62% of the total variance with a reliability coef-ficient of .91. The second dimension, labeled “convention and business,”explained 12.65% of the variance with a reliability coefficient of .92. Thethird dimension, labeled “pleasure,” explained 10.91% of the total variancewith a reliability coefficient of .74. The fourth dimension, labeled “culturalexploration,” accounted for 7.60% of the variance with a reliability coeffi-cient of .64. The fifth dimension, labeled “family togetherness,” accountedfor 5.77% of the variance with a reliability coefficient of .63. The sixth andfinal dimension, labeled “shopping,” explained 5.09% of the variance with areliability coefficient of .69.

Cluster Analysis for Market Segmentation of Macau Visitors

Cluster analysis is a multivariate analysis technique, which is also called seg-mentation analysis or taxonomy analysis. It is a statistical tool that classifiesobjects into a set of groups according to the characteristics of the objects.It seeks to identify a cluster, which both minimizes within-group variationand maximizes between-group variation (Hair, Black, Babin, Anderson, &Tatham, 2006).

To enhance our understanding of the factor structure, cluster analy-sis was employed to classify Macau visitors into mutually exclusive groups,based on a K-means clustering method. A non-hierarchical algorithm (Hair,Anderson, Tatham, & Black, 1998) was used to determine the best num-ber of clusters based on the activity factors. Cluster analysis suggested thata four-cluster solution was most appropriate for organizing the data con-cerning Macau’s visitors as well as the benefits they sought. Multivariatestatistics indicated that significant differences existed between the fourclusters (p < .001). An ANOVA test also indicated that all six factors con-tributed to differentiating the four activity clusters (p < .001). In addition,a multivariate of analysis of variance (MANOVA) test indicated that all sixfactors contributed to differentiating the four activity clusters (Pillai Trace= 1.565, p < .001; Wilks’ Ramda = .100, p < .001; Hotelling-Lawley Trace= 3.702, p < .001; Roy’s Greatest = 2.110, p < .001). Furthermore, a posthoc analysis—in this case, a Scheffe multiple-range test—was employedto explore any differences between clusters with respect to each benefitfactor. The results of the Scheffe test indicated that there were statisti-cally significant differences between clusters. The mean importance scoresfor each benefit factor were calculated, and an examination of the meanscores suggested the labels of Cluster 1: “convention and business seekers,”Cluster 2: “family and vacation seekers,” Cluster 3: “gambling and shoppingseekers,” and Cluster 4: “multi-purpose seekers.” This finding generally sup-ports the appropriateness of each category shown in Table 2 and describedbelow.

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International Travelers to Macau, China 43

Cluster 1: “convention and business seekers.” This cluster contained 554visitors, representing the largest sample of respondents. This cluster wasnamed “convention and business seekers” based on the mean score charac-teristics with respect to the factors. This cluster had the highest mean scoreon “convention and business (mean = 4.93) among the four cluster groups.Besides participating in business conferences and events, visitors from thiscluster also had interests in “culture exploration” (mean = 4.76) and “familytogetherness” (mean = 4.82).

Cluster 2: “family and vacation seekers.” This cluster contained311 visitors, and “family togetherness” showed the highest mean score(mean = 4.96) among all cluster groups. In addition, with respect to sixfactors, this cluster was found to have the second largest mean score(mean = 4.71) on “culture exploration” but had the lowest mean score on“gambling” (mean = 1.79). Thus, this cluster was labeled the “family andvacation seekers.” Visitors in Cluster 2 preferred to spend their time withfamily, friends, and relatives, while shopping in Macau. Generally, this groupof visitors seeks to experience a different culture and to mix with othertourists, as well as to visit Macau’s many historical landmarks filled with avariety of colonial Portuguese and traditional Chinese architecture.

Cluster 3: “gambling and shopping seekers.” This cluster contained 324visitors. This cluster appeared to have the highest mean score on “gambling”(mean = 4.18) and “shopping” (mean = 5.50) among the four cluster groups.This cluster was labeled “gambling and shopping seekers” based on themean score characteristics with respect to the factors. Cluster 3 is generallysatisfied with all the factors of motivations except “business and convention(mean = 1.64).” As gambling and shopping seekers, they are particularlyinterested in betting at the city’s several casinos as well as taking advantageof the traditional street markets and the high-end luxury boutiques. Macau isa free port zone where goods are sold at duty-free prices with no sales taxes.The shopping scene in Macau is also known for its bargain deals; therefore,visitors to this destination may enjoy additional savings on their purchases.

Cluster 4: “multi-purpose seekers.” This cluster contained 324 visitors.This cluster had the lowest mean score across three activity factors—“Cultureexploration” (mean = 3.80), “Family togetherness” (mean = 3.02), and“Shopping” (mean = 3.00)—when compared to the other three clusters.Thus, Cluster 4 was named the “multi-purpose seekers.” Interestingly, oneof the main activities in Macau, “Gambling,” is the lowest mean score amongall motivation factors in Cluster 4. It reasons, therefore, that visitors in thiscluster do not visit Macau for the purpose of gambling.

Cluster Differences by Macau Visitors’ Characteristics

To further understand the characteristics comprising the four clusters, eachcluster was cross-tabulated with the socio-economic and demographic

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44 W. G. Kim et al.

profiles of Macau visitors. In Table 4, the results of χ 2 tests indicate thatthere were statistically significant differences among the four clusters withrespect to visitors’ socio-economic, demographic, and travel behavioralcharacteristics.

TABLE 3 Results of Factor Analysis of Macau Visitors’ Activities and Motivations

Factor label and attributes MeanaFactor

loadings Eigenvalue Variance (%)Reliability

coefficient (α)

Benefit Factor 1: Gambling 3.20 5.20 22.62 .91To play other table games 3.23 .86To play blackjack 3.42 .86To play baccarat 3.47 .85To play slot machines 3.48 .79To bet on horse racing 2.83 .78To play other sport

betting2.79 .76

Benefit Factor 2:Convention and business

3.12 2.91 12.65 .92

To do business 3.14 .92To attend meetings and

conventions3.10 .92

Benefit Factor 3: Pleasure 3.64 2.51 10.91 .74Be entertained at the

night life3.55 .73

Do exciting things 3.72 .72Getting away from

pressures andresponsibilities

3.35 .69

To visit new and excitingplace

3.93 .55

Benefit Factor 4: Cultureexploration

4.24 1.75 7.60 .64

To experience a differentculture

4.18 .85

To visit its cultural andhistorical setting

4.87 .84

To mix with other tourists 3.67 .43Benefit Factor 5: Familytogetherness

4.19 1.33 5.77 .63

Do something with family 4.55 .77Visiting friends and

relatives3.71 .75

To spend time withfamily and friends

4.31 .68

Benefit Factor 6: Shopping 4.09 1.17 5.09 .69To buy clothing 3.14 .84Go shopping 5.04 .79Total % of variance 64.64

Note: Principal component factor analysis (PCA) was employed in each category with iterations: Varimaxrotation in SPSS/PC routine.aMean values were computed on the basis of 7-point Likert-type scale from 1 (Strongly disagree) to 7(Strongly agree).

Downloaded By: [Oklahoma State University] At: 12:26 7 February 2011

TAB

LE4

Res

ults

ofClu

ster

Anal

ysis

for

Mac

auVis

itors

’Act

iviti

esan

dM

otiv

atio

ns

Schef

fem

ulti

ple

range

test

s

Var

iable

/M

otiv

ator

Clu

ster

1(n

=55

4)Clu

ster

2(n

=31

1)Clu

ster

3(n

=32

4)Clu

ster

4(n

=32

4)F-v

alue

1–2

1–3

1–4

2–3

2–4

3–4

Gam

blin

g3.

98a

1.79

4.18

2.26

401.

33∗∗

∗∗∗

∗n.s

.b∗∗

∗∗∗

∗∗∗

∗∗∗

∗

Busi

nes

san

dco

nve

ntio

n4.

932.

221.

642.

3973

6.00

∗∗∗

∗∗∗

∗∗∗

∗∗∗

∗∗∗

n.s

.∗∗

∗

Ple

asure

4.16

3.15

3.64

3.21

66.7

8∗∗∗

∗∗∗

∗∗∗

∗∗∗

∗∗∗

n.s

.∗∗

∗

Cultu

reex

plo

ratio

n4.

764.

714.

323.

8051

.89∗∗

∗n.s

.∗∗

∗∗∗

∗∗∗

∗∗∗

∗∗∗

Fam

ilyto

geth

ernes

s4.

824.

963.

503.

0226

0.79

∗∗∗

n.s

.∗∗

∗∗∗

∗∗∗

∗∗∗

∗∗∗

∗

Shoppin

g4.

775.

325.

503.

0034

4.57

∗∗∗

∗∗∗

∗∗∗

∗∗∗

n.s

.∗∗

∗∗∗

∗

Clu

ster

nam

eB

usi

nes

sa

nd

con

ven

tion

seek

ers

Fam

ily

an

dva

cati

onse

eker

s

Ga

mbl

ing

an

dsh

oppi

ng

seek

ers

Mu

lti-

purp

ose

seek

ers

Pill

aiTra

ce=

1.56

5∗∗∗

Wilk

s’Ram

da

=.1

00∗∗

∗

Hote

lling-

Law

ley

Tra

ce=

3.70

2∗∗∗

Roy’

sG

reat

est=

2.11

0∗∗∗

aM

ean

valu

esw

ere

com

pute

don

the

bas

isof7-

poin

tLi

kert-typ

esc

ale

7(S

tron

gly

agr

ee)

to1

(Str

ongl

yd

isa

gree

).bn.s

.in

dic

ates

“notsi

gnifi

cant.”

∗∗∗ S

ignifi

cantat

p<

.001

.

45

Downloaded By: [Oklahoma State University] At: 12:26 7 February 2011

46 W. G. Kim et al.

The results in Table 5 disclose that “convention and business seekers”were primarily originated from other Asian countries (47.8%) and, to a lesserextent, China (28.8%), while “family and vacation seekers” mainly originatedfrom China (40%). A majority of “gambling and shopping seekers” werefrom China (55%), followed by Hong Kong residents (28.8%), while a clearmajority of “multi-purpose seekers” were from Hong Kong (37.6%), followedby visitors coming from Europe, North America, and Australia/New Zealand(23.7%). A majority of each of the four clusters reported that they did not flyto Hong Kong before coming to Macau. In total, only 30% of visitors flew toHong Kong before coming to Macau. The primary mode of transportation,however, of “convention and business seekers” was by plane, while “familyand vacation seekers” and “gambling and shopping seekers” was dominatedby boat, followed by car. “Multi-purpose seekers” overwhelmingly used boatas their main transportation mode.

Primarily, “convention and business seekers” traveled alone, while “fam-ily and vacation seekers” and “gambling and shopping seekers” traveledwith two or more companions. A majority of “multi-purpose seekers” vis-ited by themselves or with only one companion. A majority of “conventionand business seekers,” “family and vacation seekers,” and “gambling andshopping seekers” visited Macau as day visitors, while “multi-purpose seek-ers” stayed one night or more. Both “convention and business seekers” and“multi-purpose seekers” mostly stayed at hotels, while “family and vaca-tion seekers” mainly lodged at friends’ or relatives’ houses. A majority of“gambling and shopping seekers” stayed at casino properties. Most of thefour groups did not purchase package trips during their visit to Macau,and surprisingly the main purpose for visiting Macau was non-gamblingactivities.

“Family and vacation seekers” was comprised mostly of female visitors,while males dominated the “convention and business seekers,” “gamblingand shopping seekers,” and “multi-purpose seekers.” “Gambling and shop-ping seekers” were slightly older crowds, mostly in their 30s and 40s andhad low incomes, while the remaining three clusters were largely in their 20sand 30s. The annual income of “multi-purpose seekers” was higher than theother three groups; approximately one-fourth of this cluster’s respondentsreported an annual income of $48,000 or above. On the other hand, onlyapproximately one-tenth of “gambling and shopping seekers” belonged tothe highest income group of $48,000 or above. “Convention and businessseekers” were largely single, while the majority of the other groups’ mem-bers were married. “Convention and business seekers” were relatively highlyeducated, most frequently at the level of bachelor’s degree. The remain-ing three groups’ education levels were mainly high school degrees orpartial completion of undergraduate degrees. The primary job of most ofthe “convention and business seekers” and “multi-purpose seekers” wasprofessional/administrative. The remaining two groups’ main occupationwas clerical employees.

Downloaded By: [Oklahoma State University] At: 12:26 7 February 2011

International Travelers to Macau, China 47

CONCLUSION AND IMPLICATIONS

The purpose of this study is to examine, by using benefit-sought marketsegmentation, the differences between four cluster groups of tourists visit-ing Macau with regard to their behavioral (i.e., travel party type, length ofstay, etc.), socio-economic, and demographic profiles. We believe that ourstudy adds value to the tourism management literature related to Macau.First, we consider our benefit segmentation analysis to be unique, becauseprevious research on tourism development related to Macau has focusedmainly on destination image and branding. Second, although one couldargue that the segments found in this research may have been predictableprior to the study; our exclusive investigation of the differences between thefour cluster groups complements past image studies and raises importantmanagerial implications. Third, this study is different from other segmen-tation research carried out in other gambling destinations. For example,Park et al. (2002) segmented casino gamblers in Colorado, USA, basedon involvement patterns in order to develop market segmentation profiles.Unfortunately, Park et al. (2002) failed to show significant differences amongclusters for behavioral (i.e., travel party type, length of stay, etc.), demo-graphic, and socio-economic variables. Given both the results of Coloradoand Macau, this current study finds significant differences among the fourgroups concerning Macau visitors’ socio-demographic and travel behavioralcharacteristics. Therefore, this benefit segmentation analysis makes a con-tribution to finding the uniqueness of tourists who visit Macau not onlyfor gambling purposes, but also for convention, business, pleasure, cultural,family togetherness, and shopping reasons as well. In addition, the find-ings of this study should be valuable to help Macau’s destination marketersdevelop marketing strategies, such as package products in order to attracta wider base of travel segments and to diversify the tourist mix in terms ofvarious perspectives. Cluster analysis indicated four distinct clusters: “con-vention and business seekers,” “family and vacation seekers,” “gambling andshopping seekers,” and “multi-purpose seekers.”

The “convention and business seekers” cluster was mainly from otherAsian countries with airfare as a major transportation tool. The main charac-teristics of the cluster are summarized as follows: relatively highly educated,high income, male-dominated, and traveled alone. To attract more of thesevisitors, hotel operators should focus their marketing efforts on attractingmore convention businesses by targeting major companies in the Asia-Pacificregion. With the development of the new “Cotai Strip,” which is composedof several large-scale lodging and casino properties with over three millionsquare feet of meeting and convention space as well as the new interna-tional routes from the local airport, Macau will be able to position itself asAsia’s premier entertainment and MICE destination. Business travelers arerecognized as one of the most important segments of the travel market due

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TAB

LE5

Clu

ster

Diffe

rence

sby

Mac

auVis

itors

’Char

acte

rist

ics

(%)

Clu

ster

1(n

=55

4)Clu

ster

2(n

=31

1)Clu

ster

3(n

=32

4)Clu

ster

4(n

=32

4)

Char

acte

rist

ics

Con

ven

tion

an

dbu

sin

ess

seek

ers

Fam

ily

an

dva

cati

onse

eker

sG

am

blin

ga

nd

shop

pin

gse

eker

sM

ulti-

purp

ose

seek

ers

χ2

Country

(n=

1513

)Chin

a28

.88%

40.1

9%55

.56%

19.1

4%27

2.04

∗∗∗

Hong

Kong

12.2

7%20

.90%

21.6

0%37

.65%

Oth

erA

sia

47.8

3%24

.12%

11.7

3%19

.44%

Euro

pe/

Am

eric

a/A

ust

ralia

13.8

6%14

.79%

11.1

1%23

.77%

Fly

toH

ong

Kong

(n=

1513

)Yes

20.5

8%24

.44%

41.9

8%39

.81%

64.9

0∗∗∗

No

79.4

2%75

.56%

58.0

2%60

.19%

Tra

nsp

ortat

ion

toM

acau

(n=

1235

)Car

25.6

5%35

.14%

33.8

4%9.

64%

226.

45∗∗

∗

Boat

/fe

rry

21.7

7%35

.52%

48.6

7%67

.07%

Air/flyi

ng

51.0

8%24

.71%

15.9

7%21

.69%

Oth

ers

1.51

%4.

63%

1.52

%1.

61%

Acc

om

pan

ynum

ber

(n=

1510

)1

Per

son

47.7

4%25

.89%

25.9

3%44

.14%

69.3

29∗∗

∗

2Peo

ple

28.9

3%37

.54%

42.2

8%29

.94%

3Peo

ple

and

ove

r23

.33%

36.5

7%31

.79%

25.9

3%St

aynum

ber

(n=

1513

)D

ayvi

sit

23.5

2%27

.97%

28.0

9%41

.36%

31.7

97∗∗

∗

1nig

htor

more

76.4

8%72

.03%

71.9

1%58

.64%

Acc

om

modat

ion

type

(n=

1071

)Cas

ino

pro

per

ty36

.94%

25.9

9%74

.68%

50.5

4%16

3.53

∗∗∗

Non-c

asin

opro

per

tya

35.7

6%34

.80%

18.4

5%39

.78%

Frie

nd/re

lativ

es’h

ouse

26.8

2%38

.77%

6.44

%9.

14%

Oth

ers

0.47

%0.

44%

0.43

%0.

54%

48

Downloaded By: [Oklahoma State University] At: 12:26 7 February 2011

Pac

kage

trip

toM

acau

(n=

1513

)Yes

6.86

%9.

65%

24.6

9%11

.93%

62.1

05∗∗

∗

No

93.1

4%90

.35%

75.3

1%88

.07%

Gen

der

(n=

1513

)M

ale

63.0

0%41

.80%

64.8

1%61

.30%

64.7

4∗∗∗

Fem

ale

37.0

0%58

.20%

35.1

9%38

.70%

Age

,ye

ars

(n=

1513

)19

and

under

5.60

%8.

68%

4.32

%5.

56%

74.5

0∗∗∗

20–2

934

.30%

35.6

9%27

.16%

31.4

8%30

–39

40.4

3%27

.65%

30.2

5%25

.93%

40–4

914

.08%

18.9

7%30

.86%

25.3

1%50

–59

4.69

%7.

07%

7.41

%9.

57%

60an

dove

r0.

90%

1.93

%0.

00%

2.16

%M

arita

lst

atus

(n=

1513

)Si

ngl

e52

.89%

44.3

7%39

.51%

46.3

0%19

.48∗∗

Mar

ried

44.7

7%54

.66%

58.0

2%50

.93%

Oth

er2.

35%

0.96

%2.

47%

2.78

%Educa

tion

(n=

1513

)Ele

men

tary

school

1.44

%1.

61%

2.47

%2.

47%

53.0

4∗∗∗

Hig

hsc

hool

27.9

8%32

.48%

36.1

1%30

.56%

Under

grad

uat

est

uden

ts27

.44%

22.5

1%36

.11%

25.9

3%B

achel

or’s

deg

ree

30.8

7%29

.90%

18.2

1%24

.07%

Gra

duat

est

uden

ts5.

05%

6.11

%4.

63%

5.86

%M

S/PhD

deg

ree

6.32

%6.

43%

1.85

%10

.49%

Oth

er0.

90%

0.96

%0.

62%

0.62

%O

ccupat

ion

b(n

=15

13)

Pro

fess

ional

/ad

min

istrat

ive

39.7

1%28

.62%

32.1

0%35

.49%

43.9

9∗∗∗

Agr

icultu

ralw

ork

er1.

44%

0.64

%2.

16%

1.54

%Cle

rica

lem

plo

yee

26.3

5%30

.87%

37.3

5%25

.62%

Gove

rnm

entem

plo

yee

5.60

%8.

04%

4.63

%3.

40%

In-h

ouse

work

er20

.94%

28.9

4%18

.21%

27.7

8%O

ther

5.96

%2.

89%

5.56

%6.

17%

(Con

tin

ued

)

49

Downloaded By: [Oklahoma State University] At: 12:26 7 February 2011

TAB

LE5

(Contin

ued

)

Clu

ster

1(n

=55

4)Clu

ster

2(n

=31

1)Clu

ster

3(n

=32

4)Clu

ster

4(n

=32

4)

Char

acte

rist

ics

Con

ven

tion

an

dbu

sin

ess

seek

ers

Fam

ily

an

dva

cati

onse

eker

sG

am

blin

ga

nd

shop

pin

gse

eker

sM

ulti-

purp

ose

seek

ers

χ2

Annual

inco

me

(US$

)(n

=82

9)B

elow

$11,

999

26.1

0%28

.21%

27.6

1%12

.43%

27.1

4∗∗∗

$12,

000-

$23,

999

30.2

1%30

.13%

26.3

8%31

.36%

$24,

000-

$35,

999

14.0

8%12

.18%

20.8

6%18

.93%

$36,

000-

$47,

999

10.2

6%10

.26%

13.5

0%13

.02%

$48,

000

and

ove

r19

.35%

19.2

3%11

.66%

24.2

6%

aN

on-c

asin

opro

per

tyin

cludes

hote

l,m

ote

l,an

dgu

esthouse

.bCle

rica

lem

plo

yee

incl

udes

sale

sman

,cl

eric

alem

plo

yee/

pro

duct

ion,or

serv

ice

work

er;go

vern

men

tem

plo

yee

incl

udes

mili

tary

emplo

yee;

and

in-h

ouse

work

erin

cludes

unpai

dw

ork

er,st

uden

t/re

tired

,or

unem

plo

yed.

∗∗Si

gnifi

cantat

p<

0.01

.∗∗

∗ Sig

nifi

cantat

p<

0.00

1.

50

Downloaded By: [Oklahoma State University] At: 12:26 7 February 2011

International Travelers to Macau, China 51

to their large travel expenditure budget . Therefore, it is important for MICEmanagers and tourism policy makers in Macau to understand the motivationdrivers and satisfaction levels of business and convention visitors.

A recently published study on attendees’ motivation and satisfaction ofa mega-business event held in Hong Kong (Bauer, Law, Tse, & Weber, 2008)highlighted that the major motivational factors to attend the event werethe opportunities for business and networking as well as the business andeducational content of the event. According to Bauer et al. (2008), similarstudies have found that the safety, location, and infrastructure of the destina-tion influenced the decision-making process of business and events’ visitors.Their study also found that event attendees were mostly satisfied with theaccessibility, cleanliness, safety, and security of the destination, as well asthe tolerance for other cultures, quality of the exhibition, and the openinghours of shops. Hence, these findings may serve as a foundation for theMacau tourist bureau and hospitality managers to enhance the motivationand satisfaction levels of their business and convention guests.

In addition, the Macau tourism bureau should consider offering morevalue-added tourism products, such as post-convention tour packages forvisitors who are affluent and traveling alone. Moreover, night life activitiescould be major attractions for groups of tourists, and information about nightshows should be easily available to this segment of tourists.

The second group, “family and vacation seekers,” was mainly fromChina with boat/ferry or car as their major transportation mode. The maincharacteristics of this cluster are summarized as follows: visited mainly forsightseeing/culture exploration; traveled with two or more companions; pre-ferred to stay at friends’ or relatives’ homes rather than a hotel; and workedprimarily as clerical employees and in-house workers. Due to their relativelylow income and their desire to stay with friends or relatives, they may notprovide much impact on the hotel industry. However, this cluster group mayhave a significant impact on Macau’s restaurant and entertainment industries.This group may go out with their friends and family to visit local restaurants,bars, and entertainment complexes.

Since Mainland Chinese travelers account for 40.1% of the “family andvacation seekers,” it is crucial for restaurant managers and operators tounderstand how visitors from China choose restaurants. A recent study fromLaw, To, and Goh (2008) investigated the perception of Chinese visitorson the importance of attributes on restaurant selection in Hong Kong. Theattributes loaded into five different factors, namely 1) food and beverage; 2)service; 3) price; 4) environment; and 5) attraction. Under food and bever-age, the most important attributes for Mainland Chinese travelers were thequality and variety of menu items. Respondents claimed that restaurants inHong Kong do not provide as many menu items as restaurants in China andthat the taste of the food was lighter than the restaurants on the Mainland. Asfar as service, the most important attributes were servers’ attitudes and speed

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52 W. G. Kim et al.

of service. Value for money was also a important factor for the respondentsas they viewed that restaurants in Hong Kong were very expensive. Theenvironment factor showed that hygiene/cleanliness and comfort were thetwo most important attributes for restaurant selection. Finally, respondentswere most attracted to restaurants through word-of-mouth. Therefore, inorder to captivate this cluster, Macau restaurant operators should provide anextensive list of menu items with the stronger flavors accustomed by Chineseresidents. Food should be reasonably priced to appeal to this group of trav-elers, and restaurants must show signs of cleanliness from an environmentand food production point of view. In addition, Macau restaurant employeesmust be trained to better communicate and interact with their customers. Bytaking these steps, and by enhancing the promotional efforts geared towardproviding more information about the different cuisines at these outlets,Macau may result in a larger number of visitors, thereby increasing theirrevisit-repurchase intention.

The third cluster, “gambling and shopping seekers,” was visiting pri-marily for the purpose of gambling, traveled with two or more companions,preferred to stay at casino hotels, purchased non-packaged trips, had lowerincomes, and were male-dominated. Casino hotels rely heavily on this mar-ket segment as a major revenue source and a primary customer base.Shopping outlets inside the casino properties will benefit from this segment.In order for Macau to boost its fashion retailing industry, it is importantthat retail owners and operators understand shopping behaviors and pref-erences of Mainland Chinese visitors, because they compose 55% of thiscluster group. As the Chinese economy continues to develop, Mainland res-idents will tend to become more sophisticated and knowledgeable; thus,Chinese people will increase their standards when choosing apparel prod-ucts. Yuan and McDonald (1990) defined Mainland travelers to Hong Kongas “ethnic, arts, and people” and “urban entertainment oriented.” In theirstudy, the researchers concluded that both types of people like spending aconsiderable time of their time during travel in fashion stores. In addition,they also found that Chinese visitors enjoy interacting with sales personnelwhen shopping. In a more recent study, Choi et al. (2008) found that Chinesevisitors to Hong Kong were not satisfied with the interaction with the storessales’ personnel because they were not able to describe the product charac-teristics in detail. This problem may exist because many of the sales agentscannot speak Mandarin. Therefore, formal training for sales personnel andhiring applicants who can speak Mandarin are two important factors to beconsidered by retail owners based in Macau.

The fourth group, “multi-purpose seekers,” was primarily from HongKong, arrived via boat/ferry, visited mainly for sightseeing/culture, traveledwith only one companion, stayed at casino or hotel, had modest incomes,and were mostly male. The Macau tourist bureau should target this groupof visitors by promoting cultural heritage products combined with souvenir

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International Travelers to Macau, China 53

sales. Due to their short stay, however, these tourists may not generate highrevenues for the lodging industry; thus, they do not comprise an especiallylucrative cluster group. The casino industry would be better rewarded tar-geting tourists who are potential high rollers, though upscale casino hotelsor independent restaurants may develop special promotional packages toattract couples who are looking for a romantic atmosphere.

“Gambling and shopping seekers” showed the lowest percentage ofthe highest income group, while the largest portion of “multi-purpose seek-ers” fell into the highest income group. One plausible reason for this factmight be the visitors’ country of origin. Many “multi-purpose seekers” arefrom Hong Kong, while a large number of “gambling and shopping seekers”originated from Mainland China. There still exists a significant differencebetween the average annual incomes of Hong Kong and Chinese citizens.Another possible reason might be that a large number of low-income gam-blers visit Macau to take advantage of the heavy promotional efforts of thecasino industry. Thus, it is critical for the Macau tourism bureau to attractthe rapidly growing number of high income tourists from China, who maycurrently prefer to visit other tourist destinations for gambling and shopping.

LIMITATIONS AND FUTURE RESEARCH

As with any research, ours is not free of limitations. Due to time and budgetconstraints, the data collection was conducted during the summer periodof 2007; thus, this study may not have been able to avoid the seasonalityeffect. In addition, a convenience sample method was applied, and there-fore, the results of our findings may contain some biases. Consequently,future research in this area should be conducted on two occasions, boththe low and high seasons, and should apply some form of random sam-pling in order to eliminate bias. Nevertheless, we believe that the size ofour sample supports any statistical analysis performed in this study, therebycapturing the reality of summer travelers to Macau. Finally, our study did notcapture visitors’ expenditures and loyalty levels. By including these types ofdata in the investigation, important managerial implications could be drawnfrom the findings. Therefore, future studies may analyze the relationshipbetween tourist benefits sought and expenditure profiles of travelers, andcompare the results of first-time visitors with repeat tourists and their impacton loyalty and satisfaction with the destination.

Our study has found distinct benefit clusters of international travelersvisiting Macau. Future research in this area must be continued since Macauis a special destination. First, Macau is a “new” destination and its tourismindustry is developing at an extraordinary rate. Consequently, the benefitssought and the motives of travelers when considering Macau as destinationmay change over time. Second, due to the destination’s unusual nature and

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54 W. G. Kim et al.

culture, different clusters may be formed as Macau itself develops. Thus,destination marketers from Macau should further this research in order toimprove its marketing strategy, and thereby to gain the highest return fromtheir investment.

The results of this proposed analysis should enhance the knowledge ofdestination marketers, which in turn will be able to develop homogenousmarkets through benefit segmentation as well as to attract the big spenders.

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