Revenue Management, a Competitive Weapon in the Airline Business
“God doesn’t play dice with the universe” - Albert Einstein
What would we do, as revenue management practitioners, if we had a crystal ball? We would probably like to answer questions like:
- How much demand will we have for our premium product next weekend?
- How much would demand change if we increase or decrease the prices by 10%?
- What is our customer’s willingness to pay for our coach product in the mid-afternoon flight?
- What will be our main competitor’s reaction to a 20% price reduction in this market?
- How will the exchange rate fluctuate over the next month in this market in Asia?
This guide provides a simple-to-read overview of the fundamental concepts, analytics, and processes that revenue management practitioners should engage in to provide value to their airlines.