It is revenue management, Jim. But not as we know it.

It is a fact of life that new and contemporary concepts often appear to supersede existing ideas, when in reality they take on a meaning way beyond their true scope.  Revenue management is a good example of this.  In the old days there was reservations management i.e. the process of taking bookings to fill future capacity.  Then along came revenue management ie the process for setting prices for bookings based on forecasts of future demand.  But suddenly revenue management encompasses everything to do with taking reservations

This article – 8 Key revenue Management Trends for 2017 – is very good, but it is guilty of this.  It is actually looking at trends in reservations management, only one of which relates to revenue management.  The trends are:

  • A Continued Focus on Book Direct
  • Predictive Analytics
  • Mobile
  • Mobile Payments
  • Online Reputation & Brand Advocacy
  • Underestimating the Competition
  • Chat Apps
  • External Factors

Of these only predictive analytics is to do with how forecasting demand, and hence rate setting, will be improved by better forecasting methods.  Most of the others are to do with the channels through which the seller communicates with the customer, and the form this communication takes.    It is of real interest – but nothing to do with revenue management per se, and everything to do with reservations management.

This entry was posted in Chap 07 Capacity and demand, Sector: Hospitality & Tourism and tagged . Bookmark the permalink.

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