Revenue Management … Yield Management

CMH … 3rd Year

Liz Craig

Help Hotels + Hotel Groups – Internet Revenue

Who, What, When, What Price, Which Channel

Who to sell What to, When, At What Price Through Which Channel

Who – which customers

What - product, offer or services

When – at what time in the purchase cycle

What Price – how much should be charged

Which Channel – where does the customer purchase

Right product, offer, service Right customerRight timeRight priceRight channel

OBM – Optimum Business Mix Planning

Who … which customers

When – at what time in the purchase cycle

What Price – how much should be charged

Which Channel – where does the customer purchase

Core concepts – Supply + Demand

Demand > Supply = Maximum price

Demand < Supply = Discount price

Supply = Demand = Packaging + Conditions

Key Idea – use price to divert demand to excess capacity

Example – when you consume

RM – works best

Perishable commodity Fixed capacityFluctuation in demandCustomer price elasticityMarket driven pricingForecast demand patterns

Eiffel Exercise – Mission Maximize Demand

Customers – Who are they, when do they come… how do they get there?

Cannot change….. Hours of operationNumber of elevatorsSpeed of elevators

What Revenue Management is NOT

Computer Program

Sales & Promotion

Only about Pricing

Only about Guestrooms

Only 1 person’s job

Revenue Management …

Revenue Management … Revenue Maximization

Interested …?

Online Resource Center

cemhi@yahoo.fr