An introduction to revenue management for the hospitality industry: principles and practices for the real world

Addressing an emerging course in hospitality management, this one-of-a-kind book outlines the basic elements of the revenue management process and the keys to effective revenue management planning. Using the Rev MAP model as a guiding framework, it shows how to develop, implement, and evaluate a strategic management process. Professional profiles highlight key issues and career paths, while application chapters relate material to each segment of the hospitality industry. A final chapter looks at trends and forecasts the future evolution of this important new field. Riding the Rails......Page 1 Contents......Page 4 Preface......Page 12 Acknowledgements......Page 15 Author Biographies......Page 16 CHAPTER 1 An Introduction......Page 20 To the Four Corners of the World: Defining Revenue Management......Page 25 Internet Exercises......Page 27 Reference......Page 28 CHAPTER 2 A History......Page 30 All Aboard!......Page 31 See the U.S.A. in Your Chevrolet . . .......Page 33 No Vacancy......Page 34 The House the Animated Mouse Built......Page 35 Up, Up, and Away . . .......Page 36 Flying the Not-So-Friendly Skies . . .......Page 37 Revenue Management Moves Inn . . .......Page 40 Summary......Page 41 References......Page 42 CHAPTER 3 Customer Knowledge and Consumer Behavior......Page 44 Today's Prosumers......Page 45 Consumers and the e-Commerce Evolution......Page 46 Bundling and Pressing Time......Page 48 The Price/Value Relationship......Page 49 Marketing Intelligence......Page 51 Summary......Page 55 References......Page 56 CHAPTER 4 Market Segmentation and Selection......Page 58 Market Segments and Subsegments......Page 59 Contracts......Page 61 Group Segment......Page 62 Wholesale Terminology......Page 63 Trend Analysis and Generational Targeting......Page 65 Displacement Analysis and Total Customer Worth......Page 68 Total Customer Worth and Total Customer Value......Page 70 Selection of the Optimal Mix of Business......Page 71 Key Terms and Concepts......Page 73 References......Page 74 CHAPTER 5 Internal Assessment and Competitive Analysis......Page 76 Identifying the Competition......Page 77 Competitive Intelligence......Page 79 The SWOT Analysis......Page 81 Competitive SWOT Analyses......Page 84 Positioning......Page 86 Developing Strategies Based upon the SWOT Analysis......Page 87 Summary......Page 90 Experiential Exercise......Page 91 References......Page 92 Opportunity Costs......Page 94 Supply and Demand......Page 96 Substitutes, Complements, and Inferior Goods......Page 100 Price Elasticity......Page 102 Calculating the Percentage Changes......Page 103 Revised Formula for Calculating Elasticity......Page 104 Factors Impacting the Elasticity of Demand......Page 105 Managing Demand......Page 106 Demand Forecasting......Page 109 Key Terms and Concepts......Page 112 References......Page 113 Reservation Evolution......Page 116 The Early Channels......Page 118 Global Distribution Systems (GDS)......Page 120 Internet Distribution Systems (IDS)......Page 122 Distribution Cost......Page 125 Channel Selection......Page 127 Summary......Page 129 Reference......Page 130 CHAPTER 8 Dynamic Value-Based Pricing......Page 132 A Value-Based Approach to Pricing......Page 133 Product or Service Life Cycle......Page 136 Customer Loyalty and Brand Equity......Page 137 Internal Price/Value Assessment......Page 139 Price Positioning......Page 140 The Impact of Demand on Price......Page 144 Channel Pricing Strategies......Page 147 Discounting......Page 148 Best Available Rates......Page 149 Secret Pricing Formula Revealed!......Page 150 Pricing Alphabet Soup......Page 152 Summary......Page 153 Internet Exercises......Page 154 CHAPTER 9 Channel and Inventory Management......Page 156 Hospitality Inventory Warehouse......Page 157 Nonelectronic Channel Management......Page 160 Electronic Channel Management......Page 161 Competitive Analysis of Price and Inventory......Page 164 Inventory Management Process Per Channel......Page 166 Discussion Questions......Page 169 Internet Exercises......Page 170 CHAPTER 10 The Revenue Management Team......Page 172 Courses to Take......Page 177 Useful Experience......Page 178 Compensation: Salaries and Bonuses......Page 179 Roles and Responsibilities......Page 182 Revenue Management Meetings......Page 189 Discussion Questions......Page 193 References......Page 194 CHAPTER 11 Strategic Management and Following the RevMAP......Page 196 The Process......Page 197 The External Environmental Assessment......Page 198 Goals and Objectives......Page 201 Execution of Strategies and Tactics......Page 205 Analysis, Evaluation, and Adjustment......Page 206 The Strategic Revenue Management Process and Our RevMAP......Page 207 Analysis, Evaluation, and Adjustment......Page 210 Discussion Questions......Page 213 Internet Exercises......Page 214 Step One: Customer Knowledge......Page 216 Strategies and Tactics to Consider for Acquiring and Retaining Customers......Page 218 Step Two: Market Segmentation and Selection......Page 219 Step Three: Internal Assessment......Page 220 Strategies and Tactics to Consider Regarding the Organization's Internal Assessment......Page 222 Step Four: Competitive Analysis......Page 223 Step Five: Demand Forecasting......Page 225 Step Six: Channel Analysis and Selection......Page 226 Step Seven: Dynamic Value-Based Pricing......Page 228 Step Eight: Channel and Inventory Management......Page 229 Strategies and Tactics to Consider for Channel and Inventory Management......Page 231 Electronic Resources......Page 232 Internet Exercises......Page 236 The Issue of Price......Page 238 Revisiting the Price/Value Relationship......Page 239 What Is Considered to Be Fair?......Page 240 Pricing Laws to Protect Consumers......Page 242 Potential Bumps in the Road......Page 243 References......Page 248 CHAPTER 14 Crystal Ball......Page 250 Searching the Internet......Page 251 Key Terms and Concepts......Page 259 Reference......Page 260 The Lofty Pines Lodge and Ski Resort......Page 262 Overview......Page 264 Possible Results......Page 265 Chic B'tique......Page 268 Abbreviated SWOT Analysis for the Chic B'tique......Page 270 Overview......Page 271 Possible Results......Page 272 Scrumptious!......Page 276 Abbreviated SWOT Analysis for Scrumptious!......Page 277 Overview......Page 278 Possible Results......Page 279 Internet Exercises......Page 282 Granite Palace......Page 284 Abbreviated SWOT Analysis for the Granite Palace......Page 286 Overview......Page 287 Possible Results......Page 288 Tunes, A Lyrical Bowl......Page 290 Abbreviated SWOT Analysis for Tunes, A Lyrical Bowl......Page 291 Possible Results......Page 292 Metropolis Convention Center......Page 294 Overview......Page 295 Possible Results......Page 296 Summary......Page 297 Internet Exercises......Page 298 Skimmer Cruises......Page 300 Overview......Page 302 Possible Results......Page 303 Coachman's Seaside Paradise......Page 306 Abbreviated SWOT Analysis for Coachman's Seaside Paradise......Page 307 Overview......Page 308 Possible Results......Page 309 Quiescence Spa Retreat......Page 311 Abbreviated SWOT Analysis for Quiescence Spa Retreat......Page 312 Overview......Page 313 Possible Results......Page 314 Experiential Exercise......Page 315 Internet Exercises......Page 316 The Crags Oceanside Golf Resort and Spa......Page 318 Abbreviated SWOT Analysis for the Crags Oceanside Golf Resort and Spa......Page 319 Overview......Page 320 Possible Results......Page 322 The Desert Snow Castle Resort Casino......Page 325 Overview......Page 326 Possible Results......Page 328 Childhood Classics Theme Park......Page 329 Abbreviated SWOT Analysis for Childhood Classics Theme Park......Page 330 Overview......Page 331 Possible Results......Page 332 Summary......Page 333 References......Page 334 B......Page 335 C......Page 336 E......Page 337 G......Page 338 L......Page 339 O......Page 340 P......Page 341 R......Page 342 S......Page 343 W......Page 344 Y......Page 345 C......Page 346 D......Page 347 I......Page 348 P......Page 349 R......Page 350 T......Page 351 Y......Page 352 "Addressing an emerging course in Hospitality Management, this one-of-a-kind text outlines the basic elements of the revenue management process and the keys to effective revenue management planning. Using the Rev MAP model as a guiding framework, it shows how to develop, implement, and evaluate a strategic management process. Professional profiles highlight key issues and career paths, while application chapters relate material to each segment of the hospitality industry. A final chapter looks at trends and forecasts the future evolution of this important new field."--Jacket