Are all luxury guests the same? A benefit segmentation of 5-star hotel customers

The importance of the luxury travel sector is signaled by its global market value of US$ 1.2tn and an estimated compound annual growth rate of 7.6% until 2030 – with personalization and sustainability representing two key growth venues (Rosenberger, 2023). Among the markets, Europe arguably represents an interesting source of luxury tourism – for tour operators from developing countries, for example – because of the relatively large number of wealthy people, with a passion for travel, that live there. Switzerland has been identified as one of the most important European countries that offer opportunities for luxury tourism, because of the growing number of high-net-worth individuals there and their willingness to spend money on travel (CBI, 2023). The country generates more than one-fourth of global luxury product sales (27.1%) (SECO, 2020), and its image is frequently associated with the luxury world, especially for what concerns watchmaking and hospitality (Bonavita, 2020). Furthermore, the Swiss national tourism organization has engaged in a marketing strategy aimed at making sustainability a differentiation factor in their tourism offer – a choice that can benefit the luxury hospitality sector, which witnesses consumers putting a growing emphasis on sustainability (Amatulli et al., 2021).

From a demand perspective, the concept of luxury can be defined as “something that satisfies a desire regardless of expense” (Huh et al., 2019, p. 1033) and, within this realm, a luxury hotel is a form of accommodation that is “unique and superior in quality and that provides excellent service, symbolizing the wealth and status of its patrons” (Peng and Chen, 2019b, p. 1375). With the rising importance of experiential luxury – from owning to being – the increasing awareness concerning sustainability (Amatulli et al., 2021; Cristini et al., 2022), as well as the advances in digital communication that make products and services more accessible (Oliviera and Fernandes, 2022), luxury consumption is arguably experiencing a series of changes (and challenges) that call for a deeper understanding of diverse customers’ needs and wants (Athwal et al., 2019; Kyrousi et al., 2022). The fundamental function of luxury is to recreate social stratification in a democratic manner. Its characteristics make it unique from other tourism sectors, as it provides a context in which quality is more important than quantity, the human and experiential component is instrumental (Kapferer and Bastien, 2009) and consumer involvement is particularly intense (Oliviera and Fernandes, 2022).

The present study draws from previous research that highlighted the relevance of segmentation studies in luxury travel, also because of the importance of personalization in luxury services (Zhang et al., 2022). Therefore, with a focus on the luxury hospitality sector, our objective is to (1) identify benefits sought by luxury guests at 5-star hotels; (2) segment them based on their preferred benefits; (3) and delineate each group based on socio-demographics, trip-related factors, perception of hotel green practices and tourists’ sustainable behavior.

Benefit segmentation is a data-driven, a posteriori method to segment markets that has been extensively used in travel and tourism research, because it provides a better understanding and prediction of future purchase behavior than traditional segmentation techniques (Frochot and Morrison, 2001; Pesonen et al., 2011). This method, meant to identify the benefits sought in a product or service, has been used so far to study, for example, the tourist accommodation market concerning a city (Nessel et al., 2021), business customers in super deluxe hotels (Chung et al., 2004), and spa-goers in luxury hotels and resorts (Huh et al., 2019). Yet, no study so far (to the best of our knowledge) has performed a benefit segmentation of luxury hotel guests. Furthermore, while the perception of environmental sustainability has been used to segment 5-star hotel customers, the other dimensions (e.g. social sustainability) and the concept of ethics have been left out (Aksu et al., 2022). The relevance of the identified gap is strengthened by the fact that the luxury industry requires unconventional marketing, and it has its own unique characteristics – which have been described so far as “an uncharted research area” (Kyrousi et al., 2022, p. 560).

Considering these premises and the importance of segmentation studies in the hospitality industry (Chung et al., 2004), the present research wants to achieve the above-mentioned objectives by performing a benefit segmentation of 5-star hotel guests from Switzerland. Thus, the next sections of this article are structured as follows. First, a literature review on benefit segmentation in luxury hospitality is conducted to give an overview of the current state of knowledge on such topics, as well as identify relevant frameworks and factors for our research goals. Second, based on the literature review, a series of survey items are constructed and reviewed by hospitality experts. Third, the methods employed for collecting and analyzing empirical data using a survey are clarified. Finally, results are presented and discussed, along with implications as well as recommendations for future research.

Market segmentation consists of “viewing a heterogeneous market (one characterized by divergent demand) as a number of smaller homogeneous markets” (Smith, 1956, p. 6), in which groups of individuals with similar personal characteristics can be identified, and it is those characteristics that constitute the segmentation criteria (Dolnicar, 2002). In this regard, Dolnicar (2002) explains that market segmentation can be performed a priori or a posteriori – that is, conceptual or data-driven segmentation. In the former case, criteria employed to group respondents are known in advance; while in the latter case, groups insights are gained directly from the analyzed data.

Benefit segmentation is data-driven, a posteriori approach to market segmentation, which means that customer groups emerge empirically, and they are not known in advance (Bieger and Laesser, 2002). The idea behind benefit segmentation is that the benefits sought by people in purchasing a product or service represent the basic reasons for the existence of market segments. These benefits determine people’s behavior in a more accurate way than demographic characteristics, for example, and they can be used in promotional messages (Haley, 1968). From a service-dominant logic perspective, benefits are those tangible and (often) intangible elements that customers expect when purchasing a service (Vargo et al., 2010); they are desirable consequences derived for a product or service (Gutman, 1982), which explain why people consume it (Botschen et al., 1999).

Within travel and tourism, benefit segmentation research can be divided into two macro streams: attribute-based benefit segmentation and psychologically based benefit segmentation. The first identifies locations’ attributes as benefits, and it stems directly from the mainly utilitarian approach that was originally applied to products. The second stream associates benefits with travel motivations and focuses on the combination of sensory, rational and emotional benefits (e.g. spending time with family) expected from a service (Frochot and Morrison, 2001). Scholars argue that even though tourists may choose the same destination or purchase the same service, the (psychological) benefits sought certainly vary. Therefore, psychologically based benefit segmentation can arguably uncover the true motivation behind travelers’ choices and then be used for tailored promotions (Nduna and van Zyl, 2020). Consequently, this is the approach we use in the present research.

While there is a rather extensive literature on the application of benefit segmentation to travel and tourism (Frochot and Morrison, 2001; Nduna and van Zyl, 2020), benefit research in the accommodation sector is relatively limited (Guttentag et al., 2017; Nessel et al., 2021) and even more for luxury hotels. In this regard, studies so far have identified segments based on their interest in 5-star spa hotel attributes, like sleep quality and cleanliness (Ahani et al., 2019), as well as benefits sought (as motivations) to choose spa services at luxury hotels, such as pleasure, healing and relaxation (Huh et al., 2019). A qualitative study by Zhang et al. (2022) identifies seven luxury traveler segments based on the product attributes sought – that is, flight’s premium cabin and luxury hotel – because of status or to benefit their family. To date, this is the only research that uncovers different groups of luxury travelers using the reason behind the choice of luxury hotel as segmentation criterion. Because of their limited sample size (N = 30), Zhang et al. (2022) make a call to contribute to the topic with quantitative research on a larger group of participants – which is what we intend to do in the present research.

Investigating the relationship between perceived benefits and willingness to pay for luxury hotel experiences, a study by Ahn et al. (2021) distinguishes between self-benefits and social-benefits, where the first are associated with personal gain and self-interest, while the second concern the possibility to establish relationships with other luxury hotel guests with common interests. These factors are further expanded in a later study by Wu and Yang (2018), who analyze the benefits derived from luxury hotel services and products, drawing from previous luxury value models developed by Tynan et al. (2010) and Yang and Mattila (2016). Considering both tangible and intangible elements, the modified luxury value framework proposed by the authors contains five factors, which are meant to predict luxury hotel purchase intentions: utilitarian value, symbolic value, hedonic value, relational value and financial value (Wu and Yang, 2018). With the only exception of the relational values, the other (value) dimensions have also been used in a later study focused on the examination of luxury guests’ behavioral intentions (Peng and Chen, 2019a), which arguably signals their importance in consumer research concerning luxury hotels. Furthermore, both these outer-directed values – that is, utilitarian and symbolic – and self-directed values – that is, hedonic, relational and financial – have been suggested to determine travelers’ luxury consumption (Iloranta, 2022; Tynan et al., 2010). From a customer perspective, values can be described as benefits obtained or perceived from the consumption of a product or service (Burcu and Seda, 2013; Wu and Yang, 2018), and this is the perspective adopted in the present study.

In addition to the aforementioned factors, ethical benefits should be considered among the outer-directed elements that add value to services. Indeed, from a consumer perspective, “ethical aspects reflect the feeling of being ‘better off’ after purchasing” (Sánchez-Fernández et al., 2020, p. 857), and this reaction (or consequence) is part of a larger phenomenon that sees a growing relevance of ethical and sustainability issues in luxury consumption – which leads researchers to argue on the importance of integrating, for example, corporate social responsibility initiatives in the luxury hospitality sector (Hang et al., 2021). Indeed, certain customers can feel better in engaging with sustainable luxury brands, if they know that their money benefits society as well as themselves (Ki et al., 2017). In this regard, research suggests that younger generations (Gen Y and Z) have become more sensitive to ethical behavior (Dimitriou and Ducette, 2018), which can provide more meaning and purpose to their travel experiences (Kuokkanen and Catrett, 2022). From a supply perspective, hospitality professionals agree on the instrumental role played by ethics in their business (Santos and Almeida, 2022). Business ethics can be defined as the “study of business activities, decisions and situations where the right and wrongs are addressed” (Abdullah and Valentine, 2009, p. 93). Since corporations affect society through jobs, products and services, it is important to consider the ethical implications of corporate decisions. Given the tie between the proper use of local resources and the economic success of a business, scholars indicate that not only there is a growing number of organizations that put efforts in minimizing negative impacts on society and the environment, but there are also some companies that actively seek to regenerate places (Slawinski et al., 2021). Consequently, given the importance of ethics from both a demand and supply perspective, as well as the lack of research on the topic (Sánchez-Fernández et al., 2020), we intend to include this factor among the possible benefits sought by luxury hotel clients.

The identification of benefit segments is commonly followed by a profiling activity, where customer groups are further delineated (and validated) using variables that were not employed as segmentation criteria (Frochot and Morrison, 2001). Socio-demographics (e.g. age, origin and income) and trip-related factors are two major groups of variables that can be used to profile benefit segments in tourism (Huang and Sarigöllü, 2008), and both are relevant to describe tourists’ experiences at luxury hotels (e.g. Walls et al., 2011). In this regard, the trip-related factors identified by Walls et al. (2011) include travel party and trip purpose. To this list of factors, we argue that social media use should also be included, as later academic research underlines the heavy investments in communication efforts made by luxury hotels to reach out to customers, especially for what concerns digital content production and influencer marketing (Zhang et al., 2019). Furthermore, this variable, along with socio-demographics information, contributes to evaluate the marketing accessibility of the identified segments; while the trip purpose can be used to evaluate their reachability – that is, the “likelihood of communication efforts attracting the attention of segment members” (Loker and Perdue, 1992, p. 34). Both accessibility and reachability are important criteria to evaluate customer segment relevance (Frochot and Morrison, 2001).

Finally, given the effectiveness of sustainability in the marketing communications of luxury hotels (Amatulli et al., 2021), travelers’ interest in sustainability should also be included in the variables for segment profiling. Indeed, while for a time sustainability and luxury were thought to be incompatible – the main argument being that addressing green issues (i.e. less consumption) could be detrimental for guests’ experiences (traditionally focused on more services and consumption) – research shows that this situation is changing (Amatulli et al., 2021). Both Millennials (1981–1996) and Gen Z (1997–2012) value responsible and sustainable practices, where less is more (Gallo, 2021). Sustainability has become a form of conspicuous consumption in several cultures, giving room to the idea of “going green to be seen” (Cerbellon and Shammas, 2013, p. 92). Consumers seek genuine efforts and clear communication on sustainability commitments undertaken by luxury hotels, and these can use sustainability as a unique selling proposition (Rishi et al., 2015), or as an ancillary service providing intangible benefits for which guests can pay premiums (Kang et al., 2012). Furthermore, the concept of scarcity and superior durability associated with luxury can find a match in the idea of sustainability – which focuses on waste reduction and respect for limited resources – making it part of the luxury essence (Hennigs et al., 2013).

To conclude, considering the literature presented insofar and the identified gaps, we can formulate our research objectives as follows:

1. Identifying 5-star hotel guests in terms of benefits sought.

2. Understanding whether ethical benefits help discriminate the identified segments.

3. Exploring how the identified segments’ profiles vary with regard to trip-related factors, perception of hotel green practices, sustainable tourist behavior and socio-demographic characteristics.

The study focused on travelers from Switzerland that spent at least one night in a 5-star (luxury) hotel, at home or abroad, in the time span between 2022 and 2023. In Switzerland, at the time of the study, there were a total of 110 luxury hotels distributed between the Swiss Alps and popular cities, like Geneva and Zurich (HotellerieSuisse, 2024). In 2022, Swiss travelers accounted for 55% of overnight stays in Swiss hotels; an increase in overnight stays by one-third (3.12 million), with respect to 2021, was registered for 5-star luxury hotels in Switzerland (Beuchat and Meyer-Vacherand, 2023). In terms of outbound tourism, Swiss luxury travelers seem to favor short-haul locations (CBI, 2023). According to the Swiss Federal Statistical Office (2023), the most popular destinations in 2022 in terms of overnight stays for outbound travelers were indeed Italy, Germany and France.

In this research, we used a 10-min online survey with a structured questionnaire to collect primary data. Conditions to participate in the study were (1) having a residence in Switzerland and (2) having spent at least one night in a 5-star hotel anywhere in the world between 2022 and 2023. These criteria were imposed because of our focus on Switzerland and the instrumental role of Swiss travelers for the destination. Furthermore, having respondents from a single country of origin allowed us to exclude the probable noise originating from the distinct cultural background of international guests.

The study sample was obtained through a market research firm (Innofact), which provided us with 575 responses. From these, we excluded those people who declined to participate and those that took less than 3 min to complete the survey. Indeed, pre-tests had shown that it was not possible to complete the survey below that time threshold. Thus, our final sample consisted of 508 valid entries, which, following the literature on sampling recommendations for factor analysis (used in this research), could be described as “very good” – an evaluation that applies to samples sizes that are ≥500 (Nduna and van Zyl, 2020, p. 958).

Participants responded to the online questionnaire in December 2023. The survey consisted of two main parts: benefits sought and profiling information. The first version of survey items was developed by drawing from previous tourism research on perceived luxury benefits (Wu and Yang, 2018), ethical benefits (Sánchez-Fernández et al., 2020), trip-related factors (Walls et al., 2011), hotel green practices (Merli et al., 2019) and sustainable tourist behavior (Juvan and Dolnicar, 2016); socio-demographics were requested at the end of the survey. Subsequently, the questionnaire was revised and improved in multiple rounds through the feedback from researchers and practitioners involved in luxury hospitality. The final version (in English) was then translated in French, Italian and German.

All the items used for the exploratory factor analysis (EFA) – concerning benefits sought – were measured on 7-point scales, where the highest level of agreement or importance was assigned to the largest number (7) (see Table 1: https://osf.io/ukqg8). The EFA was necessary since the items selected to measure benefit relevance from the literature were adapted following the feedback provided by academics and practitioners in luxury hospitality. To create cognitive “speed bumps” for respondents (Podsakoff et al., 2003), two survey items were reversed-coded. Concerning the items employed for segment profiling, these were: sustainable tourist behavior (Juvan and Dolnicar, 2016) (1 = never, 7 = always), hotel green practices (Merli et al., 2019) (1 = not at all important, 7 = extremely important), trip-related factors (travel party composition, luxury hotel nights according to trip purpose, social media use) and socio-demographics. To reduce the chances of socially desirable responding, the word “sustainability” (or any of its variations) was not mentioned in any of these items.

Most of the data analysis was conducted using JAMOVI (2023). The software SPSS (IBM, 2020) was used exclusively to perform the part of segment profiling involving the chi-square tests. Our data analysis can be resumed into two main stages. In Stage 1, first, we conducted a descriptive analysis of the sample socio-demographics. Second, to test for the presence of latent constructs underneath the identified benefits (=28), we performed an EFA with principal axis factoring and an “oblimin” rotation. EFA is a powerful tool often employed in tourism and hospitality research to aggregate scores from multiple indicators. Its application was supported by a large sample size (>300) and ratio (>10 respondents per indicator) (Howard and Henderson, 2023). After performing reliability analysis on the identified factors, a hierarchical cluster analysis grouped respondents directly upon the (Anderson-Rubin) factor scores produced by EFA. Hierarchical cluster analysis is a common method in tourism research, which has the advantage of showing clusters in tree-like structures allowing for a more informed decision on the optimal number of groups (Frochot and Morrison, 2001). Euclidean distance was used in combination with Ward’s method (ward.D2), which reduces within-cluster variance while increasing between-cluster differences (Kibicho, 2008). Factor scores from EFA were used in this analysis since they represent participants’ scores on a latent factor and they can thus be useful in identifying clusters of respondents (Koostra, 2004) – which makes their use common in benefit segmentation research (Frochot and Morrison, 2001).

Following the identification of the segments (clusters), in Stage 2, we performed a series of chi-square and (Welch’s) ANOVA tests on a set of external variables, including socio-demographics. This stage had two purposes. First, using variables that were not involved in the cluster analysis was a way of validating the chosen cluster solution (Frochot and Morrison, 2001). Second, it allowed us to profile the identified segments in terms of socio-demographics and other travel-related variables. To conclude, we opted for Welch’s ANOVA because it adjusts the F-ratio to counter issues related to the violation of the homogeneity of variance assumption (Field, 2013). Furthermore, using SPSS (IBM, 2020), we produced adjusted residuals for each chi-square test to signal which cells had a significantly larger (adj. res. ≥ 2.0) or smaller count (adj. res. ≤ ˗2.0) than expected. As reported on IBM (2020) website, numerous cells may have adjusted residuals close to zero, with a select few largely responsible for the substantial contribution to the large chi-square value.

Results from the descriptive analysis of socio-demographic variables showed 40.9% of female respondents. In terms of age, 50% of participants were between 18 and 39 years old. Thus, age and gender distribution resembled the one of 5-star hotel guests in Switzerland (Switzerland Tourism, 2018). The three most frequent education levels were BA (24.4%), MA (27.4%) and Vocational School (26.6%). More than half (60.6%) of respondents were either employees without managerial responsibility or part of lower/intermediate management. Finally, half of the sample (50.0%) declared a monthly income between 10’000 and 29’999 CHF a month. All respondents were resident in Switzerland since this was a condition for the participation in the survey.

As anticipated in the previous section, the benefit items (=28) used in this study were the result of an adaptation of those identified in previous research about luxury (Wu and Yang, 2018) and about ethical benefits (Sánchez-Fernández et al., 2020). Therefore, a principal axis factor analysis (EFA) with “oblimin” rotation was conducted to identify possible underlying factors. The first results revealed the presence of multiple cross-loading items (>0.32) (Costello and Osborne, 2019) on two factors. Therefore, we repeated EFA – while excluding poorly performing items – until each item had a minimum loading greater than 0.40, which is considered stable (Samuels, 2017) and no cross-loading item (>0.32) was present. This led to a total of 22 benefit items.

The Kaiser–Meyer–Olkin (KMO) measure verified the sampling adequacy for the analysis, KMO = 0.91 – which is excellent – and the lowest KMO value for individual items was 0.76, which is above the acceptable limit of 0.50 (Field, 2013). The analysis indicated 3 factors with an eigenvalue greater than 1, and in combination they explained 52.2% of the variance – an acceptable value since extracted factors from social science research usually explain from 50% to 60% of the total variance (UCLA, 2021). The scree plot was unambiguous, showing a clear inflexion that justified retaining 3 factors. Table 1 (see here: https://osf.io/ukqg8) shows factor loadings after rotation, grouped according to the 3 factors that emerged from EFA. All of them have a factor loading greater than 0.40, which corresponds to 16% of the variance in a variable (Field, 2013).

The resulting clusters of items suggested that Factor 1 represented “social and symbolic benefits”, Factor 2 was “ethical benefits”, while Factor 3 was “functional service benefits”. We found support for the meaning of these factors in the literature that reports (1) how luxury symbolism resonates with one’s personality and helps communicate status (e.g. Wang et al., 2022); (2) the impact of hotel green practices on guest satisfaction (Merli et al., 2019) as well as the benefits of ethical luxury (Osburg et al., 2021); and (3) the functional role of luxury service consumption (Stathopoulou and Balabanis, 2019). Finally, we performed reliability tests on these factor items to ensure that they would consistently measure their corresponding construct. The resulting Cronbach’s α was either equal or greater than 0.80 – thus confirming scale reliability (Field, 2013).

The Anderson-Rubin factor scores produced by EFA were used to group study participants into segments, using an agglomerative, hierarchical cluster analysis. These composite scores have a mean of 0, a standard deviation of 1, and they are uncorrelated (Field, 2013). Analyzing the tree diagram elaborated by JAMOVI (2023), we decided to opt for a 3-cluster solution for two reasons. First, the three clusters could be clearly (visually) identified in the dendrogram, as they showed a greater distance on the y-axis compared to previous solution (i.e. 4 clusters). Indeed, the key to understanding a hierarchical cluster analysis is to observe where pairs of scores “join together” along the y-axis in the dendrogram: the longer the distance (line), the greater the difference between them (Tullis and Albert, 2013). Second, past research on luxury consumer segmentation had indicated the existence of three to four segments (e.g. Hanzaee et al., 2012; Hennigs et al., 2012; Hudders et al., 2013; Srivastava et al., 2016; Stathopoulou and Balabanis, 2019), thus providing empirical support for our observation. A series of one-way ANOVA (Welch’s) tests were performed to visualize the differences among the three clusters in terms of luxury benefits sought. Groups were compared using the Games and Howell (1976) post-hoc test (for unequal variances). All differences were significant (p < 0.01) (Table 2).

Before performing the tests for segment profiling, the items concerning (luxury) hotel green practices were tested for reliability, since in the original study they formed a single scale (Merli et al., 2019). Unsurprisingly, the output was more than satisfactory (Cronbach’s α = 0.92, M = 5.10, SD = 1.16). The same test was conducted for the items describing sustainable tourist behavior (Juvan and Dolnicar, 2016) (Cronbach’s α = 0.93, M = 2.82, SD = 1.59). Thus, each group of items was transformed into a single scale.

Concerning segment description, the identified clusters were named and typified according to benefits sought, while considering the difference with the mean scores from the other groups. The values below are the result of one-way ANOVA (Welch’s) tests and Games and Howell (1976) post-hoc tests between the segments and single benefit items measured on 7-point scales. The first segment was named “ethical enthusiast” (N = 103, 20.28% of all respondents) because of the higher score assigned to ethical, social and symbolic benefits associated with their stay at 5-star hotels. For example, this segment scored significantly (p < 0.001) higher than the other groups on the importance of luxury hotels’ efforts towards environmental conservation (M = 6.20, SD = 0.87) and fair conditions for their suppliers (M = 6.20, SD = 0.83). Similarly, they scored significantly (p < 0.001) higher on social and symbolic benefit items, such as feeling more connected to their social group by staying at 5-star hotels (M = 5.94, SD = 0.96), improving their self-confidence (M = 6.02, SD = 1.09) and sharing their experiences at luxury hotels with significant others (M = 5.90, SD = 1.15).

The second segment was named “unconcerned aesthete” (N = 182, 35.83% of all respondents) because of the (overall) unimportance assigned to ethical and functional service benefits, which was expressed by negative scores, and mild interest for a few social and symbolic benefits. For example, they scored lower (p. < 0.001) than the other groups on the importance for a luxury hotel to address social issues (M = 3.77, SD = 1.37), while they gave (on average) a middle value for the item expressing the satisfaction and pride of staying at 5-star hotels (M = 4.65, SD = 1.46), and the sense of achievement that comes with it (M = 4.69, SD = 1.39). Their highest interest in social and symbolic benefits concerned the aesthetics of the chosen luxury hotel (M = 4.79, SD = 1.39).

The third segment was named “practical connoisseur” (N = 223, 43.90% of all respondents) because they expressed (on average) a higher interest in functional service benefits than the other groups, while assigning moderate importance to ethical benefits. Furthermore, they showed the lowest score for social and symbolic benefits. For instance, they gave a significantly higher score (p < 0.05) on the price-worthiness of staying at 5-star hotels (M = 4.98, SD = 1.35), while assigning moderate importance to hotels’ transparency and fairness in pricing (M = 5.73, SD = 0.89), as well as their efforts towards environmental conservation (M = 5.50, SD = 1.13).

In terms of segment profiling, for what concerns socio-demographic variables, the “practical connoisseur” was the segment with the highest number of women (N = 106, adj. res. = 2.7) and older (60+) participants (N = 34, adj. res. = 2.5). In comparison, the “ethical enthusiast” segment had the highest number of men (N = 106, adj. res. = 2.7), while the number of participants aged between 50 and 59 years old was significantly lower (N = 10, adj. res. = ˗2.3) than the other groups. The chi-square tests also indicated that, for education and income, the “ethical enthusiast” had the highest percentage of participants with a master’s degree (N = 41, adj. res. = 3.2) and a net monthly income of 30’000 CHF or more (N = 19, adj. res. = 4.2); whereas the “practical connoisseur” showed higher frequencies for vocational school/apprenticeship (N = 76, adj. res. = 3.5) and a monthly income between 10’000 and 14’999 CHF (N = 81, adj. res. = 2.0). For what concerns social media use, the “ethical enthusiast” segment had the highest frequency of people sharing their experiences at luxury hotels on social media (N = 87, adj. res. = 3.9), while the “practical connoisseur” had the highest number of participants showing the opposite behavior (N = 81, adj. res. = 2.2). Values for the “unconcerned aesthete” were not significantly larger or lower than expected – which resulted in adjusted residuals that were neither lower nor higher than the corresponding threshold (≤˗2.0 or ≥ 2.0). Additional results concerned travel party composition (see Table 3: https://osf.io/ukqg8).

For what concerns the perception of luxury hotel green practices, an ANOVA (Welch’s) test, followed by a Games and Howell (1976) post-hoc test, showed that the segments were significantly different from each other (p < 0.001). The “ethical enthusiast” reported the highest value (M = 5.94, SD = 0.82), followed by the “practical connoisseur” (M = 5.27, SD = 0.96) and the “unconcerned aesthete” (M = 4.40, SD = 1.15). This finding was in accordance with the segments’ differences in terms of ethical benefits (Table 2). Overall, the customer groups differed also in terms of sustainable tourist behavior (p < 0.001). Yet, the Games and Howell (1976) post-hoc test revealed that only the “ethical enthusiast” was significantly different than the other two segments (p < 0.001). The scale means indicated a higher frequency of sustainable behavior for this group (M = 4.28, SD = 1.83) than the “practical connoisseur” (M = 2.53, SD = 1.27) and the “unconcerned aesthete” (M = 2.35, SD = 1.31). Finally, in terms of number of nights by trip purpose, the three segments were not significantly different (p > 0.05) for what concerns leisure – showing a relatively high mean value (>7.0). Concerning business trips, the “ethical enthusiast” had the highest number of nights (M = 5.73, SD = 3.64), while the “practical connoisseur” (M = 2.07, SD = 3.33) and the “unconcerned aesthete” (M = 2.59, SD = 3.44) were not significantly different from each other.

The present study has uncovered distinct customer segments of 5-star luxury hotels according to the benefits they seek – thus, showing that this market is not homogeneous. The analysis includes ethical benefits, given their importance for customer satisfaction and the lack of empirical research about them (Sánchez-Fernández et al., 2020). Our findings reveal the existence of three customer segments: (1) the ethical enthusiast, (2) the unconcerned aesthete and (3) the practical connoisseur. Overall, these differ on the greater importance they assign to ethical, social and symbolic benefits (segment 1), functional service benefits (segment 3) or their unconcerned attitude (segment 2). As expected, their profile differs also in terms of socio-demographic characteristics, social media use and travel party composition.

Our findings concerning the customer segments complement the results from past research in luxury marketing. Indeed, it is possible to notice various correspondences, especially with the consumer groups identified by Stathopoulou and Balabanis (2019) within the larger context of luxury consumption. Indeed, the ethical enthusiast segment resembles the luxury enthusiasts from their study. The scholars describe them as a group of people that values self-enhancement, which is characterized by elements such as social power, wealth and narcissistic traits. In our research, these narcissistic values are consistent with the great importance that the ethical enthusiast segment assigns to the social and symbolic dimension of their luxury experience, as well as their higher education level, monthly income and social media use for experience sharing. Furthermore, in line with the above-mentioned values, their interest in ethical benefits, hotel green practices and sustainable tourism behavior can also be interpreted as a form of conspicuous consumption that follows the idea of “going green to be seen” (Cerbellon and Shammas, 2013, p. 92). Hennigs et al. (2012) identify a similar segment, called “the luxury lovers”, who “have a strong desire to be unique and different from others” (p. 1028).

The unconcerned aesthete segment is similar to the unconcerned consumers identified by Stathopoulou and Balabanis (2019). The scholars describe how this group scores low on all luxury values, including usability and quality; they also have low proclivity to purchase luxury products. The mild importance (at best) they attach to aesthetic benefits makes the segment from our study also resemble the “novices” identified in the context of luxury wine consumption, who remain focused on surface properties of purchased products (Hall, 2016). Aesthetics is, in fact, intertwined with the experiential and symbolic value of a product, and it concerns its beauty (Alfakhri et al., 2018). Finally, the practical connoisseur segment resembles the functionalists (Stathopoulou and Balabanis, 2019) or rational functionalists from past research, who place more emphasis on the functional aspects of luxury products rather than prestige (Hennigs et al., 2012). Thus, their buying behavior is affected by personal factors, rather than social ones (Hanzaee et al., 2012).

This study brings three main theoretical contributions. First, through EFA, we have identified a set of underlying benefits that are sought by guests when choosing luxury hotels. To the best of our knowledge, no study so far has achieved this. Therefore, these findings compliment previous research on benefits derived from luxury services (Ahn et al., 2021; Wu and Yang, 2018), by showing that these can be grouped into three factors – namely, social and symbolic benefits, ethical and functional service benefits. Ethical benefits represent a novel factor in luxury hospitality segmentation; their role in discriminating the segments provides further support to past research showing that sustainability has become part of luxury (Hennigs et al., 2013), and highlighting it can boost luxury hotel bookings (Amatulli et al., 2021). Second, this study represents the first a posteriori, quantitative attempt at segmenting the luxury travel market, showing that it is made of different consumer groups that seek distinct benefits. Therefore, we find support for the “heterogeneity argument” from past qualitative research (Zhang et al., 2022) – thus, going beyond the search for common characteristics of luxury travelers. Finally, the present research highlights the significance of ethical benefits in luxury consumption, particularly for the “ethical enthusiast” segment. This finding adds to the body of literature that examines the intersection between luxury and sustainability (Kunz et al., 2020), suggesting that ethical considerations can be a significant factor in consumer decision-making in high-end markets.

From a digital marketing perspective, we recommend hotel managers to segment their clients according to the benefits they seek, going beyond the basic grouping based on travel purpose – which is still used by many hotels as a key segmentation practice (YieldPlanet, 2018). In addition, hotel marketers can re-use the identified benefits in their storytelling on social media, alternating them in different posts or stories. Indeed, our findings show that most people in each segment use social media to share their travel experiences (see Table 3: https://osf.io/ukqg8), and this is especially true for the ethical enthusiasts – who are also those that assign high importance to sharing pictures and videos of their stays in 5-star hotels. Sharing stories about the hotel’s ethical practices can attract this segment and encourage social sharing. This consumer-feedback content can be then re-used to give signs of social proof to prospective customers, who look online for “tangible” evidence of service experiences (Petrescu et al., 2024). Furthermore, we recommend luxury hotels to use our segmentation to group newsletter subscribers for email marketing, whereby each cluster can receive tailored messages that highlight the benefits they seek. For example, following our findings, the unconcerned aesthete can be addressed with content hinting at the aesthetic beauty of the location and hotel, while the value for money (price worthiness) could be highlighted more for the practical connoisseur segment. To conclude, our findings also have implications for property design and staff training in high-end restaurants. These include incorporating eco-friendly materials and technologies in the guest experience, as well as educating staff on how to share stories about the hotel’s conservation efforts and ethical sourcing (for the ethical enthusiasts). Finally, the prioritization of aesthetics and design elements that reflect sophistication and exclusivity of the hotel can create visually stunning environments that appeal to the unconcerned aesthetes’ desire for beauty and pride in their accommodation.

The present research is not exempt from limitations. First, because of timing issues, we did not ask any unprompted open-ended questions – even though these are preferable for sustainability-related items (Juvan and Dolnicar, 2016). In addition, considering our focus on ethics and sustainability, we did not control for the social desirability bias. Second, the generalization of the findings should be done with caution. As we used a sample of Swiss residents, a similar outcome can be expected with participants that are culturally close to Switzerland. In this regard, other segmentation studies have used samples from single countries (e.g. Aksu et al., 2022; Huh et al., 2019; Zhang et al., 2022). Yet, we argue that this characteristic does not limit drastically the theoretical and managerial relevance of their findings. Finally, we identified the segments on one sample only – instead of splitting it into two sub-samples (e.g. Müller and Hamm, 2014) – which did not allow us to perform a further validation of the identified clusters.

Future research should address the gaps highlighted above and replicate our research by including cross-cultural differences. A longitudinal study could also capture changes in ethical considerations among clients of luxury hotels, since the topic is evolving at a fast pace. Furthermore, future research could combine data from guests of both luxury hotels and resorts, leading to a larger overview of the luxury market. Finally, to further test the external validity of our segmentation, it would be beneficial to conduct a follow-up quantitative study with clients of 4-star hotels, which can be considered as a more accessible form of luxury consumption.

We would like to express our thanks to Nathalie Seiler-Hayez, Managing Director of Swiss Deluxe Hotels, and Christine Peter, from Switzerland Tourism, for their support of the project.

Funding: This research has been funded by the University of Applied Sciences and Arts of Western Switzerland's (HES-SO) research grant “RCSO Economie et Management du Domaine Economie et Services” (No: 121893).