Market segmentation in hotel revenue management is the practice of splitting a hotel’s potential guests into distinct groups or “market segments” based on their specific characteristics, needs or behaviors. Each segment has different price sensitivities, booking behaviors and requirements and hotels can leverage this data to increase conversion rates, occupancy and overall profitability, while improving the guest stay experience. Common market segments used by hotels include (but are not limited to) business travellers, leisure travellers, group bookings, last-minute bookers, corporate bookings and long-term/extended stay travellers. For most hotels, these basic segments are a good start, as they will help hotels create an effective business mix that balances occupancy and pricing as supply and demand changes in the destination. For most hotels, these basic segments are a good start, as they will help hotels create an effective business mix that balances occupancy and pricing as supply and demand changes in the destination.