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The purpose of this paper is to show how yield management and dynamic pricing, which originated in the airline industry, are now diffusing in other service industries. The aim is to demonstrate that these techniques can be profitably applied to telecommunications and similar sectors and to examine the particular conditions of their implementation, development and efficiency.

The main concepts of yield management, dynamic pricing and CRM are carefully scrutinized. Also discussed is the concept of natural demand curve that aims at reaching a better compromise between the capacity of a company and the demand in an environment where services cannot be sold in advance. In order to sustain the analysis and demonstrate its managerial implications, five case studies are presented that exemplify some aspects of yield management techniques in the telecommunication sector.

Since the telecommunications are undergoing a process of increased competition and dynamic convergence, yield management techniques can help telecom operators to optimize the benefits they can derive from a subtle management of information networks and partnerships. However, such an approach is more difficult to implement in the telecommunication industry than in the airlines sector because of the difficulty to control (and sometimes refuse) network access to customers.

Capacity and revenue management become critical differentiation factors in improving service quality, loyalty and profitability. Given the increase in competitive pressure, the main objective of operators to sell customer access database to potential partners represents a radical change in the nature of financial and information flows and leads to a “customized management of services supply”.

Most airlines utilize a revenue maximizing technique called yield management, which allows the airlines to allocate their fixed capacity of “perishable” seat inventory to various fare categories in the most profitable manner possible. Demand for these fare categories is usually defined in terms of the “business” vs “leisure” customer segments, while capacity is apportioned between discounted vs non‐discounted seats. The discriminatory pricing goal is to sell only non‐discounted seats to the business travel segment. Suggests that yield management techniques may also be appropriate in certain retail settings involving physical products. In the case of physical products, capacity (i.e. product inventory) is not necessarily “perishable” in the same sense as unsold seats on an airline flight; however, its value may decline with the culmination of a well‐defined shopping period or with a particular special event. Examines how the appropriate use of early discount pricing in markets defined by decreasing customer price sensitivity can maximize the revenue gained from sales of a “seasonal” product.

Yield should be equally considered alongside usage rate and monetary value when managing materials. The precise impact that good yield management (or the lack of it) has on a company will vary from business to business depending on the sensitivity to variations in yield achievement. In order to be effectively managed, production yield performance must be planned and controlled, and this can only be achieved if accurate yield information is available to management. Yield performance data should be collected from each and every stage of the manufacturing process for which it is determined to be measurable, then analysed and comparisons made with established yield standards. The information should be presented to management as “exception reports”, thus emphasising priorities.

Definitions of yield management vary in terms of their content and focus. Develops a “best fit” definition of yield management of the hotel sector by reviewing the literature in this area and extracting the key words and central meanings used. In addition, produces a list of eight features using a comparison and analysis of the views of London‐based front office managers and features of yield management applications promoted through vendors′ sales literature. Together these eight features illustrate what an ideal yield management application would offer. While all of the applications currently for sale within the UK offer some of these features, none of them are capable of performing the complete range.

This paper explores the implementation of yield management using different reservation modes at a global hotel network (referred to as the “Group”).

The Group operates close to half‐a‐million rooms in about 4,000 hotels world‐wide. Following an overview of yield management in hotel industry, the two reservation modes used in the Group are presented. The performance of Group's online and off‐line reservation modes globally over a two‐year period is then discussed in terms of three yield management performance measures, namely: average price (AP), occupancy rate, and average revenue per available room.

The findings indicate that the online mode outperforms the off‐line mode with respect to performance measures of AP and average revenue. Further to a global‐based comparison, a localized evaluation of these two modes is also presented for two sub‐groups of hotels clustered in a given region. Statistical analysis of findings is provided, pointing to a substantial revenue increase for the hotel sub‐group that switched from the off‐line to the online reservation mode, compared with the hotel sub‐group that continued to operate off‐line. The paper concludes with a brief discussion on the strengths, weaknesses, opportunities and threats associated with the online reservation mode.

Future research could look into the impact of specific macro and micro economic conditions on the three yield management performance measures defined.

The research reported is of value to hotel executives who want to pursue online reservations.

The increasing entropy of competitive markets forces companies to maximise profitability to the optimum level their resources will permit. Since services cannot be stored, they have to be prepared and distributed more or less at the same time. Yield management, an information technology tool, seems to provide at least a partial solution to the questions that assail managers. Complementary to marketing policy, yield management is an effective way of modulating one of the variables of the marketing mix — price.

Yield management has been adopted by many hospitality organizations. An introduction to yield management concepts, resources and ideas for the design and implementation of price and capacity management tools is provided in the context of private club management. The use of contribution‐based yield statistics to monitor the performance of price and capacity decisions in high variable cost operations is discussed, along with reservations policies, perceptions of fairness and the use of coupons to obscure differential price policy.

Forecasting is a vital part of hospitality operations because it allows businesses to make imperative decisions, such as pricing, promotions, distribution, scheduling, and arranging facilities, based on the predicted demand and supply. This chapter covers three main concepts related to forecasting: it provides an understanding of hospitality demand and supply, it introduces several forecasting methods for practical application, and it explains yield management as a function of forecasting. In the first section, characteristics of hospitality demand and supply are described and several techniques for managing demand and supply are addressed. In the second section, several forecasting methods for practical application are explored. In the third section, yield management is covered. Additionally, examples of yield management applications from airlines, hotels, and restaurants are presented.

This study aims to identify the economic impact of a potential implementation of a Climatic Reserve for the Swiss predominant white grape variety (Chasselas) vinified in the AOC (controlled designation of origin) category. The Climatic Reserve would imply the possibility of harvesting an additional quantity of grapes whose commercialization in wine would be delayed until it is approved by the relevant authority.

The impact of a potential implementation of this wine supply management tool is simulated through an innovative method that combines the vector autoregressive (VAR) model to estimate the influence of the previous consumptions and productions on the current consumption and linear regression [ordinary least square (OLS) method] to estimate the price elasticity to measure the evolution of the price depending on the simulated consumption. The VAR model is based on state-level data about production, stocks, and consumption (all the channels of distribution combined), while the OLS regression for estimating price elasticity uses the retail market data (Nielsen Panel). With the sales and price variables on a monthly frequency design, the latter represents about 40% of the wine market in Switzerland.

According to simulations carried out at the level of a region from the canton of Vaud in Switzerland (2000–2018), the increase in turnover linked to the release of the Climatic Reserve would be +3.1% for the indigenous white grape variety Chasselas.

The Climatic Reserve is a wine supply management tool that could complement the existing yield restriction, which does not significantly influence the quantities sold, according to previous studies. Our paper contributes to the literature by demonstrating the economic advantage of this supply management tool to deal with the increasingly frequent climatic hazards in wine production and market. The methodology could be applied to other wine regions (contexts) or other agricultural sectors.

Revenue management has grown in popularity and is now a widely accepted discipline that has brought about significant improvements to businesses worldwide. With globalisation in recent times, there is now space for international hotels, fast food restaurants, automobile companies and other brands to offer their products in India. Educating people who are going to be part of such a process is a huge challenge. The aim of this paper is to present some of the challenges businesses and communities have to overcome.

The paper uses secondary sources to explore possible approaches to rapidly stimulate the uptake of revenue management through partnerships between hospitality and tourism businesses.

A growing middle class population and access to better education presents an opportunity to build a wider range of profitable services. Global brands with already established revenue management practices are in a position to share skills and knowledge with new and smaller players. Partnerships will be essential to rapidly and effectively develop the skills and knowledge required, starting with those in educational fields where the resources are already in place.

Revenue management has not been deployed widely in India. Being able to learn from the early adopters would allow Indian firms to leapfrog over issues and barriers, thus implementing practices more rapidly and effectively.