Revenue Management: Advanced Strategies and Tools to Enhance Firm Profitability

Abstract

Much of the past research on revenue management (RM) has focused on forecasting and optimization models and, more recently, on adaptation of RM to the specific needs in various industries, such as restaurants, car rental, transport and even health care services. Surprisingly, although many industries have become increasingly customer-focused, the customer seems to have been relatively forgotten in this stream of research. Our intent in this monograph is to help explore the role of marketing in RM in more depth.

Demand-based pricing in the US theme park industry

“…RM practice is most effective when applied under a particular set of supply and demand conditions typical of the travel sector (Kimes, 1989;Kimes and Wirtz, 2015). RM is most effective when fixed costs are high relative to variable costs, and inventory is relatively fixed, perishable, amenable to advance sales or reservations and differentiable in terms of features, quality, reliability, convenience and brand or image (Dyer et al, 2015;Hayes and Miller, 2011;Kimes and Wirtz, 2015;Phillips, 2005).…”

“…RM is most effective when fixed costs are high relative to variable costs, and inventory is relatively fixed, perishable, amenable to advance sales or reservations and differentiable in terms of features, quality, reliability, convenience and brand or image (Dyer et al, 2015;Hayes and Miller, 2011;Kimes and Wirtz, 2015;Phillips, 2005).…”

“…RM developed in the travel and lodging sector, but many industries outside of this sector have embraced RM techniques (Kimes and Wirtz, 2015). By contrast, the theme park industry has only recently shown interest in RM (Klar, 2010;Klar and Lewison, 2011) and has been reluctant to adopt such practices (Clarke, 2012;Zarya, 2015).…”

“…airline seats) is divided into differentiated subset inventories, and the sale or withholding from sale of these subset inventories is carefully managed across time and sales channels to meet demand for the purpose of maximising realised total revenue and profits. RM techniques have long been employed as standard practice within the airline (Cross, 1995;Kimes and Wirtz, 2015), hotel (Forgacs, 2010;Hayes and Miller, 2011;Kimes, 1989Kimes, , 2003Tranter, Stuart-Hill and Parker, 2011) and rental car industries (Carroll and Grimes, 1995;Cretin and Scuto, 2013;Haensel, Mederer and Schmidt, 2012) and have subsequently been adopted by a number of other industries.…”

Identifying the Optimal Combination of Hotel Room Distribution Channels: A DEA Analysis with a Balanced Scorecard Approach

“…Rate fences: Characteristics that are used to determine the room rate of a hotel including things like the location of a room, type of service, specific days/dates, and segmentation (Kimes & Wirtz, 2015).…”