Table of Contents for
Pricing and Revenue Optimization
Preface
Chapter 1: Background and Introduction
1.1 Historical Background and Context
1.2 The Financial Impact of Pricing and Revenue Optimization
1.3 Organization of the Book
Chapter 2: Introduction to Pricing and Revenue Optimization
2.1 The Challenges of Pricing
2.2 Tradition Approaches to Pricing
2.3 The Scope of Pricing and Revenue Optimization
2.4 The Pricing and Revenue Optimization Process
2.5 Summary
2.6 Exercises
Chapter 3: Basic Price Optimization
3.1 The Price-Response Function
3.2 Price Response with Competition
3.3 Incremental Costs
3.4 The Basic Price Optimization Problem
3.5 Summary and Extensions
3.6 Exercises
Chapter 4: Price Differentiation
4.1 The Economics of Price Differentiation
4.2 Limits to Price Differentiation
4.3 Tactics for Price Differentiation
4.4 Volume Discounts
4.5 Calculating Differentiated Prices
4.6 Price Differentiation and Consumer Welfare
4.7 Summary
4.8 Exercises
Chapter 5: Pricing with Constrained Supply
5.1 The Nature of Supply Constraints
5.2 Optimal Pricing with a supply Constraint
5.3 Opportunity Cost
5.4 Market Segmentation and Supply Constraints
5.5 Variable Pricing
5.6 Variable Pricing in Action
5.7 Summary
5.8 Exercises
Chapter 6: Revenue Management
6.1 History
6.2 Levels of Revenue Management
6.3 Revenue Management Strategy
6.4 The System Context
6.5 Booking Control
6.6 Tactical Revenue Management
6.7 Net Contribution to Revenue Management
6.8 Measuring Revenue Management Effectiveness
6.9 Revenue Management in Action
6.10 Summary
6.11 Exercises
Chapter 7: Capacity Allocation
7.1 Introduction
7.2 The Two-Class Problem
7.3 Capacity Allocation with Multiple Fare Classes
7.4 Capacity Allocation with Dependent Demands
7.5 Capacity Allocation to Action
7.6 Measuring Capacity Allocation Effectiveness
7.7 Summary
7.8 Exercises
Chapter 8: Network Management
8.1 Background and Introduction
8.2 When is Network Management Applicable?
8.3 A Linear Programming Approach
8.4 Virtual Nesting
8.5 Network Bid Pricing
8.6 Dynamic Virtual Nesting
8.7 Network Management in Action
8.8 Summary
8.9 Exercises
Chapter 9: Overbooking
9.1 Introduction
9.2 A Model of Customer Bookings
9.3 Solution Approaches
9.4 Extensions
9.5 Measuring and Managing Overbooking
9.6 Alternatives to Overbooking
9.7 *Appendix: Derivation of the Show Probability for Overbooking
9.8 Exercises
Chapter 10: Markdown Management
10.1 Background
10.2 Markdown Optimization
10.3 Estimating Markdown Sensitivity
10.4 Markdown Management in Action
10.5 Summary
10.6 Exercises
Chapter 11: Customized Pricing
11.1 Background and Business Setting
11.2 Calculating Optimal Customized Prices
11.3 Bid Response
11.4 Extensions and Variations
11.5 Customized Pricing in Action
11.6 Exercise
Chapter 12: Pricing and Revenue Optimization and Customer Acceptance
12.1 Price Presentation
12.2 Fairness
12.3 Implications for Pricing and Revenue Optimization
12.4 Summary
12.5 Exercise
Appendix A: Optimization
A.1 Continuous Optimization
A.2 Linear Programming
A.3 Duality and Complementary Slackness
A.4 Discrete Optimization
Appendix B: Probability
B.1 Probability Distributions
B.2 Continuous Distributions
B.3 Discrete Distributions
Bibliography
Index