Interviews

How Zoku found its market niche

With an increasing number of travellers entering the market, what are the benefits of properties focusing on one guest segment rather than targeting the masses? David Kijlstra, Commercial Director at Zoku shares his thoughts
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David Kijlstra
David Kijlstra, Commercial Director at Zoku

Defining and understanding your target audience is key for reaching potential guests and ensuring a satisfying stay. Click. spoke to David Kijlstra, Commercial Director at Zoku to learn more about building a concept around a specific segment and how properties can identify their target audience in the first place.

Click.: Which guest segment does Zoku focus on?

Kijlstra: We aim to attract what we call the global nomad: not digital nomads or business travellers, but they fit somewhere in between those two segments. This market is made up of people who live abroad in cities, usually between five days to two months. They are there to work, meet new people and explore a new city before moving on to a different destination.

Once we identified this, we had 150 interviews with people who fitted the description, but also with HR managers, travel managers, and global relocation managers to see what the demand was. Our Co-Founder, Hans Meyer, also went to live as our target audience by basing himself in Bali, Washington and Buenos Aires for two months in each place. We built prototypes, invited guests in this segment and asked for their feedback. When we opened in 2016, we knew that our concept would be a great match with the global nomad lifestyle.

Click.: What was the reason for focusing specifically on that segment?

Kijlstra: We felt it was a very underserved target audience. We looked at the trends - such as globalisation - and discovered that by 2050 more than 70% of the world’s population will be living in cities. The traditional expat market is slowly declining and what we see now is more people instead choosing to live in different cities for shorter periods.

People don’t want to be tied to an office anymore and are requesting to work from co-working spaces, home or from a cafe. We think the same trend is going to happen in terms of where in the world employees want to work. People will want the freedom to work from anywhere - especially the upcoming generations. When we combined those trends and looked at the traditional offering of serviced apartments, we saw there was a very big opportunity.

Click: What are the benefits of focusing on one segment rather than targeting the masses?

Kijlstra: Guest satisfaction. We see a direct correlation between people who know about our concept prior to staying with us and higher review scores. Whereas if a guest hasn’t chosen for the concept themselves - for example, a traditional business traveller who had a travel agent book for them - then this might affect the review score negatively. In the end, we think a higher review score results in higher loyalty. Ensuring that the right guests stay at your property really helps with that.

This also allows us to really focus on better understanding our segment: what are they looking for next, which platforms do they focus on and which brands do they work with? From there, we try to align with the things they love and evolve with them. Every segment is going to continuously change, so it’s crucial for brands to move with them.

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Room at Zoku
'In the end, we think a higher review score results in higher loyalty.' Photo: credit to Zoku

 

Click.: Are you willing to sacrifice bookings in search of the right guests?

Kijlstra: The day I was hired, the Co-Founder said to me: ‘I’ll be happier if you fill Zoku 80% but with the right target audience, than 100% with a random audience that didn’t choose Zoku for the concept’. That’s really been a focal point for me and the team. It’s really about bringing together the right type of people and we do sometimes sacrifice revenue because of that.

Ideally, we would be able to filter guests - just as they can filter hotels - until we have a guest that is looking for a unique place where they can stay, work and engage with other likeminded people.

Click.: What’s your advice for determining which segment properties should focus on?

Kijlstra: What it really comes down to is going back to the beginning and asking yourself which segment your property was created for and which target audience you match best with? Then, make sure to think from their point of view with every important decision. At Zoku, when creating new services or designs, we involve our guests through interview and prototype tests. This way, we avoid creating services that our segment doesn't want.

It’s also about trying to let go of feeling like you need to cater to everyone and focusing on spending your time where you will make the biggest impact. That’s one of the reasons we stepped away from Twitter, for example. It’s a very nice platform but here in Europe at least, it’s difficult to gain traction with our audience. Instead, we see our target audience interacting a lot with Instagram, so we put a lot of effort into that platform and dare to say no to other platforms rather than feeling like we have to be everywhere.

 

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Person using laptop
Hero image: credit to Zoku
Takeaway
  • Zoku focuses on catering to the global nomad: a segment that sits between digital nomads and business travellers
  • Researching trends, conducting interviews and building prototypes can help you find your market niche
  • According to David, there's a direct correlation between people who know about Zoku's concept prior to staying there and higher review scores

 

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