The Basic of Revenue Management
THE BASICS OF REVENUE MANAGEMENT
IDeaS
© 2005 Integrated Decisions and Systems, Inc. ID-MK-100102-v1-YMBasic
The Basics of Revenue Management by IDeaS
TABLE OF CONTENTS
TABLE OF CONTENTS ..................................................................................................................2 WHAT IS REVENUE MANAGEMENT? ........................................................................................4 When Is Its Use Appropriate? ......................................................................................................4 Segmented Markets ...............................................................................................................5 Fixed Capacity.......................................................................................................................5 Perishable Inventory...............................................................................................................5 Low Marginal Servicing Costs................................................................................................5 Advance Sales .......................................................................................................................5 Uncertain Demand Forecasts..................................................................................................5 Some Industries That Meet Criteria for Application of Revenue Management ................................7 How Does It Work? ..................................................................................................................10 Market Segment Pricing .......................................................................................................10 Peak/Off-Peak Pricing .........................................................................................................11 Forecasting Demand ............................................................................................................11 Inventory
IDeaS
© 2005 Integrated Decisions and Systems, Inc. ID-MK-100102-v1-YMBasic
The Basics of Revenue Management by IDeaS
TABLE OF CONTENTS
TABLE OF CONTENTS ..................................................................................................................2 WHAT IS REVENUE MANAGEMENT? ........................................................................................4 When Is Its Use Appropriate? ......................................................................................................4 Segmented Markets ...............................................................................................................5 Fixed Capacity.......................................................................................................................5 Perishable Inventory...............................................................................................................5 Low Marginal Servicing Costs................................................................................................5 Advance Sales .......................................................................................................................5 Uncertain Demand Forecasts..................................................................................................5 Some Industries That Meet Criteria for Application of Revenue Management ................................7 How Does It Work? ..................................................................................................................10 Market Segment Pricing .......................................................................................................10 Peak/Off-Peak Pricing .........................................................................................................11 Forecasting Demand ............................................................................................................11 Inventory