Revenue Management for Hospitality and Tourism

Book Discription

The purpose of this book is to examine the revenue management function and to explain the mechanism of commercial decision making, from the definition of segmentation grids and pricing policy to the final decision to accept or refuse to sell a service at a given price on a given date. The revenue management function, always viewed as integrated to the marketing field, is central to hospitality and tourism companies and, from an operational point of view, reports more often than not to senior management. The book incorporates many contributions from practitioners, academics, and revenue management experts from across the hospitality and tourism industry, including contributions that cover transport, accommodation, tour operations and car rentals. It has deliberately been written in a very engaging, accessible and student-friendly manner to facilitate learning, with a rich supply of contemporary case material included throughout the book. The case material has been carefully selected to provide the reader with an overview, as up-to-date as possible, of what is really going on in each sector, as well as providing a strong international coverage with case material originating from the USA, Europe and Asia.

The book is written by leading academic and industry experts actively engaged in revenue management, research and teaching this is a new and original treatment of the whole field for students and professionals. The first part of the book provides academically rigorous challenging and contemporary material to get to the core of the subject and to make the theory and practice lively, relevant and engaging. Throughout this, and the second section, numerous references to past and present good practice are used- giving insight into best practice in cutting-edge companies leading the revenue management agenda in markets all over the world. The second part of the book is authored by a range of academics and practitioners.

The Emergence of Yield Management

Chapter 1 puts the theory and origins of Yield Management into context for the reader. The principles and practices of Revenue Management are defined and shown to have advanced through their many applications across the hospitality and tourism industry. The chapter includes industry examples to complement the narrative and help the reader appreciate how this price maximisation and capacity management tool has transformed into an all encompassing business management practice. The concept of revenue integrity is introduced as is the concept of Total Revenue Management as an all-inclusive approach to analyzing data relating to all sections of the business.

Book Information

Print Length

256 Pages

Language

English

Publisher

Goodfellow Publishers Limited

Publication Date

March 13, 2013

Dimensions

7.5 x 0.8 x 9.5 inches

ISBN-10

1908999497

ISBN-13

978-1908999498

About The Author

About Alan Fyall

Dr. Alan Fyall is Visit Orlando Endowed Chair of Tourism Marketing and Associate Dean, Academic Affairs at the Rosen College of Hospitality Management, University of Central Florida. He has published widely in his fields of expertise and is the author of over 150 articles, book chapters and conference papers as well as 22 books including Tourism Principles

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About Patrick Legohérel

Patrick Legohérel is Professor at the School of Hotel and Tourism Management (ESTHUA – UFR ITBS), and member of the GRANEM Research Department, University of Angers, France. His work has appeared in academic journals such as the European Journal of Marketing, Journal of Retailing and Consumer Services, Journal of Global Marketing, Journal of Travel and Tourism Marketing, International

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About Elizabeth Poutier

Elisabeth Poutier is Professor of Marketing at ESSCA School of Management, France, where she is co-director of a dual Master’s Degree in Revenue Management and Service Marketing awarded by ESSCA and the State University of Angers. She holds her PhD degree in Management from the Conservatoire National des Arts & Métiers (CNAM) in Paris. In addition to her

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Table Of Contents

Chapter 1 puts the theory and origins of Yield Management into context for the reader. The principles and practices of Revenue Management are defined and shown to have advanced through their many applications across the hospitality and tourism industry. The chapter includes industry examples to comple ment the narrative and help the reader appreci ate how this price maximisation and capacity management tool has transformed into an all encompassing business management practice. The concept of revenue integrity is introduced as is the concept of Total Revenue Manage ment as an all-inclusive approach to analysing data relating to all sections of the business.

Chapter 2 focuses on the components of Revenue Management, continuing the theme of evolution into a multifaceted tool for deci sion making. The contributors explore how adaptation of the key elements of a business’ marketing approach, that is, customer infor mation, market segmentation and of course pricing, combined with key performance indi cators such as occupancy rates, RevPar (revenue per available units), optimisation levers, over booking policy, quota restrictions and distribu tion, play such an integral role in Revenue Management decision making. The inclusion of the French high-speed train service iDTGV ©2014 Macmillan Publishers Ltd. 1476-6930 Journal of Revenue and Pricing Management Vol. 13, 1, 74–76 www.palgrave-journals.com/rpm/ Book Review and Best Western Hotels’ cases assist the reader to better comprehend the components of Revenue Management and its progression.

Chapter 3 considers the strategic importance placed on the function of revenue managers and the position they hold in the organisation. The Revenue Management function requires a free f low of information across departments to accommodate the decision-making process that occurs at a senior level. The role of the revenue manager is defined as ‘trans-disciplinary’ and the revenue manager is described as having to understand the business dynamic and provide a format for optimising the best return for the business. Using a number examples from indus try (Corsair, Accor and Carlton Hotel, Paris), the consensus is that the revenue manager plays a key role in the organisation, requiring a high degree of expertise, analytical skill and support.

Chapter 4 suggests that the revenue manager should use a four-step approach encompassing data analysis, demand forecasting, revenue optimization and performance monitoring. The early part of the chapter concentrates on how integral data analysis is to the revenue manager’s decision-making process. Using portfolio data graphical analysis as a comparative tool reveals the impact of ‘pick up’ (increases in business) for a specific period that can identify failings or create new opportunities for increasing sales. This leads onto an overview of demand fore casting through use of historical data and aware ness of future events. The latter part of the chapter considers the analysis of data for revenue optimisation. The process implemented within the airline industry shows the complexity of decision making that Revenue Management software systems incorporate. However, the key theme of the chapter is that where an integrated software system is used or not, pricing needs to be determined based on demand and in terms of capacity.

Chapter 5 concludes Part 1 and investigates the implementation of a Revenue Management system that will meet the needs of the organization. The chapter uses examples within the airline and hotel industries to illustrate how Revenue Management systems involve the integration of a number of systems, software and databases. It argues that successful performance, based on Revenue Management systems, not only relies on forecasting and optimization techniques but on the skill, knowledge and expertise of their operatives. In addition, it is proposed that the advancement of real time connectivity tools, developments in software, the integration and the appropriateness of the Revenue Management system to the organization are reasons why businesses opt to lease rather than buy. Ultimately the number of systems, software and databases that are available to the revenue manager in addition to understanding demand are dictated by the size and nature of the business. In turn, these are variables that need to be considered in relation to the Revenue Management system employed by the organization.